Don't Fall Into the Gap

When it comes to trading strategies, one of the toughest plays to execute is off an opening gap. When the market opens lower -- as it did Nov. 16, for example -- the move necessitates some patience as you wait to see if or when a bottom is achieved. A gap up, meanwhile, is a tough mental challenge: Do you jump on board and go long as the train is quickly gathering steam, or do you fade it?

These days, market momentum is the great equalizer. If you get on the wrong side, you'll pay the price -- and I myself have had my share of good and bad results. Often when I'm on the right side of a trade, I will use the strength or weakness to unload positions. I will rarely open new swing trades -- though I may do some intraday trading -- as these extreme moves are unlikely to follow through. If, perhaps, there is some continuation, there should be some safe entry points....182 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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