Troy asked 7 years ago
Howdy Pat,
You occasionally mention on the Twitter VIP stream about scanning for potential gap setups near the end of the trading day. I saw today a post showing that you typically look for a maxlist stock closing near the high of the day on good volume. I am interested to know if there are any other parameters you look for in identifying gap candidates. And, further, what do you do with gap candidates that you find? Do you take a small position or add to an existing position in anticipation of the gap? Do you wait until the next day and enter on the gap (i.e. have a watch list with gap candidates flagged)? Etc.?
Thanks a bunch for all the help!
Troy
1 Answers
Pat Walker Staff answered 7 years ago
When scanning for Gap Ups we focus primarily on MAXLIST stocks. They are the most consistent gappers. We look fro stocks closing near the highs of day with really good volume. We buy a small amount, not a full position. If it gaps up we will sell some into the gap up within minutes of the open. We make sure the remaining shares don't fall back below the previous days close. If it does, we are quick to sell those shares.
https://youtu.be/_pE69wOZtX0
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Great explanation Pat. Thanks!