Figure 2. AXU (Alexco Resource Corporation) 5 Day 15 minute candlestick chart
Both figures above show the challenges associated with trading the opening minutes of the trading day. I have found from personal experience that this tends to be a challenging time to trade. It is in the first few minutes that emotions and excitement tend to be at heightened levels and the spread between bid/ask tends to be larger. Especially if the stock gaps significantly up at the open, I have found it is better to control your excitement, wait for a pullback to get get a lower risk entry. Sure there are stocks that gap up at the open and continue higher, but in most cases such buys have cost me money.
Figure 1 shows a chart of KNX (Knight transportation). I was planning on buying it last Friday (9/16) above 15.04 (see dotted line). In the opening minutes it gaped up and went as high as 15.11 (highlighted by orange circle on chart). I decided to wait for a pullback and then buy if the stock regained its upward momentum. It did pull back, but was never able to show strength.
Figure 2 shows a chart of AXU (Alexco Resource). I was planning on buying it today above 8.95 (see dotted line). In the opening minutes it gaped up and went as high as 9.00 (highlighted by orange circle on chart). I decided to wait for a pullback and then buy if the stock regained its upward momentum. It did pull back, but was never able to show strength.
Overall, this market continues to be choppy and very challenging.
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