Buy High, Sell Higher
By Michael on Jun 3, 2004 in Stock Market, Trading Techniques
The CANSLIM Investing Blog has a post today discussing overhead resistance and why you’d want to buy as a stock just as it’s breaking out to new all-time highs. Another reason I’ll add to the list is the potential for a short squeeze. Once a stock makes a new all-time high, not only are there no more ‘natural’ sellers (people who were long but were sitting on a loss and want to sell to beak even) but now everybody that’s short the stock is losing money and will have to buy to get out of their positions. That kind of panic buying can make for some incredible gains.
Tags: Breakouts, Buy_High_Sell_Higher, CANSLIM, Resistance, Short_Squeeze
1 Comment(s)
By tom on Jun 3, 2004 | Reply
Speaking of resistance, it looks like we’re in for a long summer if the current upleg’s dead already.