Tesco Gap

Hi Amo,

That would be the ideal scenario but there's no guarantee that it will do that. 344p ought to be a minor support too so you could just go long with a stop below that perhaps. I'd be surprised if it went through this level this time round but I wouldn't mind a long from the uptrend support ready for the next attempt

Hi Jackozy,

If the price closed above 351p and one wished to go long. Do you think it would it be best to wait for a retest of 351 before doing so?

Thanks
Amo

As expected, TSCO is approaching the major resistance at 350/1p now. Here's the long term daily chart just to remind you where this resistance comes from:



dl.dropbox.com/u/20815047/TSCOdaily03_01_13.gif

We should be able to have a fairly tight stop of c. 5p on this as it's such a key level. If it closes above 351p then we could expect it to get to the gap at 385p which is close to the shorter term downtrend however there is that gap up from 326.65p to consider so I'll be taking the short from 350p.

dl.dropbox.com/u/20815047/TSCOdaily14_12_12.gif

Here's the gap on the above chart. IMHO it will get filled but maybe not before a test of the 351p recent high. My reasons for this are that the 2 types of gap which often get left are runaway gaps and breakaway gaps. In this case, while it has gapped up over a short term resistance, it's not a major one and it hasn't continued up in a fashion which supports the momentum required by either of these two gap types.

Two simple strategies for me here:

1) If it returns to the gap from here (before moving up) then I'd go long with a stop below the low at 320.2p (same candle the gap came from) and then close my long at 350p near the 351p resistance or;

2) If it continues up to test 351p then I'd short there and look to close and reverse to a long position from the gap using the stop detailed above in 1).

If I was to guess then I'd say that 2) was more likely to happen than 1), but then again, some people always favour The Third Way

Hi All

just wondered on peoples thoughts on the gap up on the 5th Dec and if it's likely to get filled.
i've been on investopedia and they say there are diferent types of gaps and that some don't get filled.

wondered what the CV crew thought ?