There are times I'm willing to buy a stock EITHER on a pullback
to support (say, the moving averages) OR upon a breakout. Not
always in a position to be monitoring my screen. I know how
to set up a conditional buy order to make the purchase one way or
the other.
My question is: Would it be "wise" or "otherwise" to put the
conditional trade on both ways to insure I buy the stock if either
of those scenarios materialize? Have two accounts, so I can
set up the conditional buy for either way (not sure I can do both
under the same account).
Understand that in theory, if I'm not monitoring the action, I
could end up with twice the stock (first price dips to support,
then it breaks out), but are there other pitfalls to occasionally
making this move??
Maybe a good situation to learn about buying or selling options
on either side of the consolidation -- like a call just above
paired with a put just below or many variations
Posted by sschulman on 10th of Jan 2013 at 01:19 pm
Hey RitchieD
Just a couple of things to think about - If it first dips to
support, then breaks out, you're good! BUT what if it first breaks
out, then dips and stays down? Can you put a stop loss on the
breakout order at the same time as you place that order? Or can you
place both orders on one of your accounts but make them OCO? OCO
means "One cancels the other".
Question about buying a stock in a consolidation pattern
Posted by RichieD on 10th of Jan 2013 at 06:39 am
There are times I'm willing to buy a stock EITHER on a pullback to support (say, the moving averages) OR upon a breakout. Not always in a position to be monitoring my screen. I know how to set up a conditional buy order to make the purchase one way or the other.
My question is: Would it be "wise" or "otherwise" to put the conditional trade on both ways to insure I buy the stock if either of those scenarios materialize? Have two accounts, so I can set up the conditional buy for either way (not sure I can do both under the same account).
Understand that in theory, if I'm not monitoring the action, I could end up with twice the stock (first price dips to support, then it breaks out), but are there other pitfalls to occasionally making this move??
Maybe a good situation to
Posted by bkout3 on 10th of Jan 2013 at 01:44 pm
Maybe a good situation to learn about buying or selling options on either side of the consolidation -- like a call just above paired with a put just below or many variations
If only I had the time
Posted by RichieD on 10th of Jan 2013 at 04:37 pm
But thanks for the suggestion.
complex orders
Posted by sschulman on 10th of Jan 2013 at 01:19 pm
Hey RitchieD
Just a couple of things to think about - If it first dips to support, then breaks out, you're good! BUT what if it first breaks out, then dips and stays down? Can you put a stop loss on the breakout order at the same time as you place that order? Or can you place both orders on one of your accounts but make them OCO? OCO means "One cancels the other".
Suzn
Thanks suzn, I'll check out the OCO possibility
Posted by RichieD on 10th of Jan 2013 at 04:35 pm