PDN.TO

The day before, Paladin was testing a lower bollinger touch as per the chart in the Public list.

The buy signal (%b) hadn't appeared yet.

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At the close, yesterday Paladin was at 2.40 and this morning there was a gap up to 2.50 on the open and a subsequent run to 2.65.

Paladin can be choppy, What should of happened was a small gap down, or move closer to the lower bollinger, possibly a tail or lower candle shadow penetration of the lower bollinger.

A look at the chart says the buy signal is on. One day it's not, another day it is... How do you buy?

We are ready to buy (we are watching) but we don't chase and we don't buy the gap. As gorillas, this is a bad banana thing to do. If anything, we would have anticipated the gap and bought yesterday, and we would sell the gap on the open about an hour into the day (depends). Assuming we had bought yesterday and were holding... We certainly at the worst, would sell above breakeven if we were thinking it may go higher tomorrow and it goes bad on us today and won't hold a high finish.

If the price moves to go below todays open... that is something we won't let happen. It's called risk control. we will take a chance and hope to to renter when we can see more stable price action, preferably lower.

A gap up on a running upward price movement is something that you might chase, and we may run into that later as in the big bounce, or we may still breakout of $2.90, but this gap is different because of it's relativity..

This morning was a gap up off a lower bollinger bounce, which is a gap up off a running down price movement.

As a gorilla, I expect the price to run up on the gap (which it did to 2.65), but I also expect the price to come back and test the lower bollinger in a more sane manner, now that the newbies have been washed out. This price gap up almost touched the upper bollinger (Bearish)

I'm looking for a purchase possibly as low as 2.45, or under, in the next few days.

I'm pointing this out because, when you look a renko chart, the blocks of price movement are ranges, not solid start and finish measurements of movement.

This means that a block of Renko price movement appearing as it has in the 60 minute frequency is NOT necessarily a runaway to the upside. It is good practice to compare the daily to the 60 minute frequency. A block of renko price movement in a daily can be a very large move.

The gap did two things for us:

- Allowed some of the upper resistance to bail out, setting up less resistance for a good run, and presenting us with a buy opportunity off the lower bollinger. This means that you can plan your entry expecting back fills to provide you with a lower price to buy.

- Shook up the newbies who may think twice about being so gullible when they see the ugly candles in the chart.


GLTA Lostoutwest
Kenuck SmallCap Trader

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