{"id":950,"date":"2009-06-08T19:47:59","date_gmt":"2009-06-09T00:47:59","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=950"},"modified":"2023-04-06T12:56:17","modified_gmt":"2023-04-06T16:56:17","slug":"afternoon-support-equals-morning-resistance","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/afternoon-support-equals-morning-resistance","title":{"rendered":"Afternoon Support Equals Morning Resistance"},"content":{"rendered":"<p>I would like to share with you another little gem from the world of intraday trading.\u00a0 If a stock shows support at a particular level in the afternoon then the following morning this level will serve as resistance if the stock has gapped down.\u00a0 In our <a href=\"https:\/\/www.smbtraining.com\/blog\/trader-90-trader-365\">AM Meeting<\/a> today I highlighted some of the market leaders such as AAPL and GS.\u00a0 The most important level I discussed in GS was Friday afternoon&#8217;s support of 148.70.\u00a0 This was also a key level on Friday morning as well as Thursday afternoon.<\/p>\n<p>As an intraday trader I am always searching for prices that served as support or resistance in the recent past.\u00a0 I set price alerts at these levels for potential trades.\u00a0 Then I use my tape reading skills to decide whether or not to establish positions at these prices.\u00a0 For example, if I know that 148.70 has been a key level the past couple of trading days in GS I will watch the Box and the prints when GS gets to this price.\u00a0 If a bid is unable to hold above this key level then I will enter a short position.\u00a0 If I notice significant selling at this level then I will add to my position.\u00a0 By combining my technical analysis knowledge with my tape reading skills I am able to establish positions with incredibly favorable risk to reward ratios.<\/p>\n<p>I was watching AAPL and GS like a hawk on the Open.\u00a0 I was looking to see if the price action would confirm the\u00a0weakness I had seen in the market on Friday.\u00a0 GS gapped down nicely on the Open, which was further confirmation of its weakness\u00a0from the prior trading day.\u00a0 About an hour later it\u00a0traded up to the 148.70 level.\u00a0 I shorted a small position.\u00a0 After it dropped below the 148.70 level I shorted some more.\u00a0 My trading plan was to cover my second lot if the 148.70 offer lifted (which it never did) and cover my first lot if a bid held above 149.\u00a0 During the next 10 minutes GS traded down about one point and I covered my short.\u00a0 I made sure to set a price alert again for the\u00a0 148.70 level.\u00a0 The price alert came in handy about 15 minutes later when GS traded up to 148.79.\u00a0 It looked awful on the Box as it couldn&#8217;t even hold a bid above 148.65.\u00a0 I reestablished a short position and actually caught a larger down move the second time.<\/p>\n<p>I hope to find one this good tomorrow \ud83d\ude42 . Don&#8217;t forget to <a href=\"http:\/\/twitter.com\/smbcapital\">follow us on Twitter!<\/a>.<\/p>\n<p><img decoding=\"async\" class=\"alignnone size-full wp-image-972\" title=\"gs-06-08-09-with-text\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2009\/06\/gs-06-08-09-with-text.bmp\" alt=\"gs-06-08-09-with-text\" \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>I would like to share with you another little gem from the world of intraday trading.\u00a0 If a stock shows support at a particular level in the afternoon then the following morning this level will serve as resistance if the stock has gapped down.\u00a0 In our AM Meeting today I highlighted some of the market leaders such as AAPL and &#8230; <a href=\"https:\/\/www.smbtraining.com\/blog\/afternoon-support-equals-morning-resistance\" class=\"more-link\">Read More<\/a><\/p>\n","protected":false},"author":143,"featured_media":972,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,8,15],"tags":[],"class_list":["post-950","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general-comments-2","category-steven_spencer_steves_blogs","category-trading_theory"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.1.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Afternoon Support Equals Morning Resistance | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/afternoon-support-equals-morning-resistance\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Afternoon Support Equals Morning Resistance | SMB Training\" \/>\n<meta property=\"og:description\" content=\"I would like to share with you another little gem from the world of intraday trading.\u00a0 If a stock shows support at a particular level in the afternoon then the following morning this level will serve as resistance if the stock has gapped down.\u00a0 In our AM Meeting today I highlighted some of the market leaders such as AAPL and ... 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