Opening Price Theory and Trading Timings

Posted by admin on June 27, 2009 under Articles | Be the First to Comment

Opening Price Theory and Trading Timings

HAd been a while after those losses..Studied a real bit on price movements intraday and spotted a few pointers we can rely on.

1. Try not to trade between 0900 – 0930. Study if prices holds above OP after 0930 and sustainable till 1015 – 1030. If below OP..weakness on stock. If price holds well above OP throughout the day. Most likely it will lead..

2. Try not to buy between 1130 – 1230.

With that, I reverse abit of previous loss on Kepland. Shorted it at 2.35 and covered at 2.21 followed by long at 2.26 which was bad timing but I did not hastily cut loss this time but I held on seeing another upwave..luckily for me it did realised and I escaped at 2.29.

With the OP theory, sensed weakness in stocks. CapitalLand was trading below OP today and executed a quick short at 3.80, to see the price break down. Covered at 3.75. I should have held on but worried of the window dressing effect.

Coupled with timing in entries, monitoring of price movements and opening price on day when you need to execute a trade. + TA of the charts the day before. It could make our trades more timely.

The strong reversal before dive…

Kepland was strong on 25/06. big white candle up like 12 cents with large volumes. I seen this senario 3rd time. twice in Kepland and once in SPH. Prices have been falling or trading in tight ranges and suddenly reversal formed which looks strong. After that day, price will still be trading at that range for another 1-2 days before it goes back to dormant stage…after that it will go down trend.

This is just an observation. Kepland and Capitaland made many happy on 25/06. Today, weakness showed in this counters instead of showing another white candle which was evident in the previous reversals instead we see a small black candle. or a star. Its for us to judge next week.

These are just my observations and it may not always hold in various market situations.

by kkworks, http://www.rmao.net/forum/viewtopic.php?f=2&t=369