Post by
green24 on Aug 12, 2016 3:41pm
Three day rule
I should make a comment about this. From my own personal observations, the three day rule, which sort of implies that sellers and selling doesn't get exhausted for three days following bad news, often works differently when it is broken up by a weekend.
Then the big MM's use that time to do detailed analysis and decide at what level the bottom should realistically fall at. Then they tend to dump hard Monday morning until the sp goes well below this level, creating the actual bottom, and load back up as quickly as they can (often averaging down as some of then just can't practically dump all of the shares they own) and then the buying will push the sp back well above where they think the bottom should be - and they start dumping again. The sp will dip below that bottom, but not the beginning of the day true bottom, and they will load up again - and just keep rolling their shares in a huge volume mess, trying to get their average costs down and get out of as much of the stock as they can (assuming they no longer believe in it).
Then Tuesday it gets pushed up to close 5-10% higher.
This is my total layman's view of what is possibly going to happen. Just a guess, but I've seen it take place so many times that I think you might be able to call it an educated guess.
Do your own DD and trade wisely. Personally, I'll be watching it closely Monday morning and may be a buyer then.
GLTA CXR longs.
Comment by
greenpasture on Aug 12, 2016 3:58pm
Sure setting up for that on Monday. Would not be suprised to see a double bottom Tues or Wed.
Comment by
greenpasture on Aug 12, 2016 4:03pm
Boy did they sure work to get a close above 13.00 today.Then house 79 dropped it on them right at 1600 hrs. Monday will be interesting to say the least.
Comment by
greenpasture on Aug 12, 2016 4:40pm
Boy did they sure work to get a close above 13.00 today.Then house 79 dropped it on them right at 1600 hrs. Monday will be interesting to say the least.