One of my favorite day trading patterns presented itself on the gapping stocks list this morning. AVID, Avid Technology Inc. formed a BL1 at the open. After closing at it’s high, AVID gapped below its low of the day before. This trapped all the bulls, who now frantically want out of the stock.
As a trader, I need an entry. I decided to look for a BS2 on the 15-minute chart. This would give the stock a little more time to settle down after the open.
As you can see by the 15-minute chart. Avid never triggered the setup. Instead, the day trade was triggered using the 5-minute chart. R would have been equal to .36. Unfortunately, I didn’t take this trade. Hypothetically, this trading opportunity could have yielded up to a 4R reward just today.
This is frustrating. You can’t let these situations get to you though. There will be plenty more trading patterns to play. The stock market is open five days a week.
The last 2/3 of CLB was sold for 2R, and a nice day trade in ATI using a BL2 pattern on the daily, put some profits in the books. Tomorrow is another trading day.
