Category Archives: Gaps

Batting One Thousand

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In its entire history as a public entity, Twitter has had four earnings reports, and for all four of those, there has been a big price gap. Earnings yesterday after the close were no exception, and I was cheerfully short the stock (I thank Slopers for chattering so much about it, since it didn’t even occur to me to short the stock until you guys chimed in). One wonders if the day will come that Twitter’s earnings don’t shock the market in one direction or the other. I’ve covered.

1028-twtr

The Key to Success

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The stock below, KeyCorp, is a good short candidate in its own right, but it’s also representative of the kind of short I’m seeking these days. It has these elements:

+ a clean topping pattern;
+ a firm drop, exhibiting that it’s vulnerable to the general weakness we saw in past weeks;
+ a hearty bounce, pushing it to a more attractive risk/reward level.

As with so many other stocks, this one has a horizontal line anchored on a gap (in this instance, at a dollar value of $12.71) (more…)