RTT TREND FFIV

With all these recent gaps I knew to start looking for pull backs. So today RTT was showing FFIV in a trend up. I saw the gap it created and knew this was going to be one of Gary’s PEAK PLAYS.

I waited and around 11:21 I started to see the signal.

I got in a 110 Feb put for 5.7 with 5 contracts and watched for the end of the PEAK. I got out around 12:44 for 8.35 for a profit of $1.325.17 or 46%.

This is one of the reasons why I love gaps! They give great signals for Peak Plays.



Edited 1 time(s). Last edit at 01/24/2013 05:19PM by Darcy.

Darcy,

Did you know this was going to be a peak play because of the fact that they had actually missed earnings by a penny according to some estimates, yet it still gapped up? or was it mostly just the gap up that had you watching for a pullback?

I'm struggling with accurate interpretation of gaps. Exhaustion vs. continuation etc. Back to studying!

Thanks as always!

I based it entirely on the gap and information from Gary about Peak plays. I generally do Peaks well but on Slams I mess up almost 100% of the time. Slams are like Dead Cat Bounces except faster. Perhaps if I turned my screen upside down on Slams I could do well!

With Peaks I look for not only a gap up but a gap up outside of the Bollinger Band. On FFIV look at the 55,34,21,8 charts on 1/24 and you will see they gapped outside the Bollinger Band.

A gap up and inside the Bollinger Band seldom brings a Peak play. Generally a gap up inside the Bollinger Band continues the climb up or down or sideways.

This is not ALWAYS. ALWAYS is not a word known in tech trading. A word of caution…if you can’t watch the charts continuously do not do Peaks or Slams. Your trade could last only 15 minutes or less but I make a good percentage of my money off Peaks.