C'mon Dino! Are you seriously telling me that a trader would hold off taking a position is a stock that has all the correct signals in place for a move up? Volume, depth, trend, etc etc ... "but hang on, there is a gap 3 months ago so I wont buy"!!! Sorry, I dont buy that!
With BKP, it traded in a range since that gap, always just a few points away, and then dropped to fill the gap on August 9 ... Now please have a look at a chart of the XAO on that day. The XAO just happened to fall 200 points on the back of a 600 point fall in the DOW. Maybe that all happened because traders on the DOW heard that BKP had a gap between 1.4-1.5??
Sarcastic I know, but it highlights the stupidity of using gaps to determine your trading, it highlights that BKP fell NOT because it had a gap, but merely because the DowJones sky fell in overnight! Any good trader would be more interested in BKP breaking out of its trading range, breaking the obvious resistance at 2.4, any increase in volume, and any other indicators that show an impending move. If some or all of these were in place, any previous gap would be inconsequential, ESPECIALLY to a trader who wouldnt give a stuff what the stock would be doing in THREE months time!!!
ROB Price at posting:
1.8¢ Sentiment: LT Buy Disclosure: Held
