wedn plays

Nothing close to a play or lean today.

After posting my swing trade this morning I received several emails
concerning my method for finding the stocks to make the trades.

The method I use is a mean reversion method. Which means I am looking to buy
stocks that are extremely oversold in the short run.

In addition I try to cordinate the purchase with what appears to be a high likelyhood of a turnaround in the markets. So if the market is overbought and due
for a pull back I usually dont place these trades.

But this morning when we get a large gap down in a correction that is in day 3 it creates an excellent opportunity to look for these types of trades.

The major risk is 1. No stop loss since most studies seem to indicate that mean reversions systems lose equity when used with stop losses. 2. What traders call a “black swan” event. ie….bankruptcy or something major that would cause a huge downswing in the price.

So…its important to create a universe of stocks to look at that are fundamentally sound. Not an easy task.

My thoughts on the hd trade is if we get a gap up thurs… sell. If not reevaluate thurs morning. Or if we get a large turnaround today consider selling at the end of the day. A big turnaround would be a positive close of over 100 pts in the dow.

Typically the gains on these trades range from 2 to 10 percent in a day or two.

Meanwhile as I am posting this hd is trading at 24.80 up almost 2.5 percent from our buy an hour ago. A good sign since the market is pretty much where it was when we placed the trade.

If anyone has any other questions drop me an email.


Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Contact Us

We're not around right now. But you can send us an email and we'll get back to you, asap.

Not readable? Change text. captcha txt
Rickj's Handicapping Picks
Sign up now for our  newsletter. Includes handicapping tips

NFL Plays Last season was the best in 20 Years!!! MLB we are on track for back to back 17 unit seasons.

RickJ's Handicapping Picks  The latest in positive EV handicapping Techniques Overnight Plays in MLB are sent out around 3 to 4 PM PST the day before Come join us for a fun and profitable Pro Sports season!!!  
Sign up now  for a fun and exciting football season

Positive EV Handicapping

Do you know the important clues that help determine which side has +EV?
  • Learn about Reverse Line Moves and how they apply to each sport
  • Learn about being a contrarian and using public % numbers to get an edge
  • Learn about the seasons within a season that all sports have
  • Learn key numbers in all sports

Sign up to get updates that will help you with your sports handicapping!