Review of Daily Bouncer Watchlist 3/23/11

CNIT and CHBT stayed in a tight range today and were never in play. GLNG reversed bounced nicely after dropping through $23.77 to a low of $23.45. PRAN was a very dangerous play today, and while it dropped to a low of $3.09, it bounced around a lot before getting there, and would have been a tough play using good money management technique.

Daily Bouncer Watchlist for 3/23/2011

Here is a list of possible bouncers for Wednesday.

CNIT - Bounce play above $3.21, continuation play below $2.91

GLNG - Reverse bounce play below $,23.77, continuation play above $24.87

CHBT - Bounce play above $8.18, continuation play below $7.35

PRAN - Because the move upward was so drastic, I actually like the reverse bounce play below $3.61, I don't like the continuation play because the $4.50 resistance is so far from the current price.

Review of Daily Bouncer Watchlist 3/22/2011

Watching todays bouncers in action reminded me of a strategy I haven't highlighted yet on this blog. I use it often and it just about doubles the amount of opportunities available for high probability trades. I highlighted this strategy in the post "Taking Advantage of the Bouncer Setup No Matter What Direction the Stock Heads" and I will try to post the levels that seem to be good buys and good shorts from now on. OCLR and GLNG would have both been good plays today using that strategy. ENER shot up quickly, but was not really a good opportunity unless you were quick to sell. That is one reason I usually avoid the lower priced stocks, because unless you are quick to sell you can easily lose your shirt. MHS was a nice play today as hit a high of $53.84 after breaking through the $53.00 level that would have been a buy signal.

Here is the intraday chart for MHS

Continuation Play - Taking Advantage of the Bouncer Setup No Matter What Direction the Stock Heads

The bouncer technique, which is the main focus of this blog, can be a nice play when the stock follows through. When the bouncer does not follow through, the play available is usually still a high probability trade. Let's look at one of the stocks from the daily bouncer watch list, GLNG. As is shown in the first chart, there was support at $23.03 that we were looking for the stock to break through for the bouncer play to be in effect. If the stock does not break through $23.03, the next thing to look for is for the stock to break the resistance level on the long shadow of the candle stick. This is a resistance level to watch, because if it breaks through there the stock often will continue strongly in that direction. GLNG did break through this resistance at $23.93 today and shot up to a high of $24.87. We can see this move on the second chart. This setup is my second favorite, because it leaves an opportunity open even when a bouncer does not bounce.