Steven,
Gaps don’t always fill but many of them do fill. Nothing is guaranteed. It’s just human trading nature to push for a gap fill (supply and demand). I don’t have a better answer for you.

I decided to hold onto it through the recent market correction but did sell half of my position when I was up around 75%. Truth be told, while I am thankful for you, Chris, for pointing out the stock to me in the first place, I feel pretty good for holding onto it when you first mentioned you were selling.

I know, I know, I shouldn’t gloat because things can change… but today, at least (when the stock is performing well), I’d like to enjoy the moment!

If I may ask one more question about the MA gap, I think you said that always a gap will fill – could be months or up to a year. Can you explain to me why these gaps must fill? or what triggers them to be filled? What makes them repeatable events as with AU in August or on your ROCM Post from July 17th (Support and Resistance) that showed ROCM had an unfilled gap in March?

My sincere thanks for your time!

Steven Mac

The market was weakening, the NH-NL ratio was falling fast and it was the middle of the summer. All the forces told me to cash in so I did and I wasn’t looking for new trades. I knew these stocks had to correct and my bread and butter is the 200d- m.a. so I figured I would wait. I am up over 56% for the year so I don’t need to be greedy.

I took down half my position a few days after the reversal because of the information my screens were giving me at the time. It was a weak market and the NH-NL ratio was pathetic. Volume did play a big part as the stock reversed on larger volume (this clearly showed sellers had the upper hand).

I happened to get out at the top for MA but that wasn’t the case for BIDU. But it doesn’t matter, I far exceeded my objectives and I left with a handsome profit. I never look to get out at the top, sometimes you just get lucky with your timing.

I would like to add on to my previous post – is there a particular reason why you didn’t take the position down when the pattern was down trending between 155 and 160?

Thanks,
Steven Mac

I have a question about the MA reversal that you pointed out in the chart. I haven’t really studied Candlesticks yet to see further behind their meaning, but after looking up that candlestick, I suppose it classifies as a Shooting Star that would indicate reversal from an uptrend movement?

Reference Shooting Star Example Chart:
http://stockcharts.com/school/data/media/chart_school/chart_analysis/candlestick_bearish_reversal_patterns/bearrev2-shoot-chv.png

Was there anything also in the volume that warned you to take 1/2 of your position down? a combination or the pattern alone? I am intrigued by your call on this and would like to know more.

Thanks,
Steven Mac

Today I want to start what a series that I will call "Around the investment blogging world." In these posts I will link to some posts from other investing blogs that are worthy of GrowYourFunds readers attention. It will be my……