BUD 0.00% 0.6¢ buddy technologies ltd

BUD: Where are we?, page-183

  1. 12,643 Posts.
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    Hi Dave,

    Notlistening may not have seen your post or logged in yet, so I will attempt to answer your question... Gaps occur when there is no trading at certain price levels, usually due to an announcement, so the price 'gaps up' before opening or 'gaps down' on bad news... Filling the gap means the shares trade at the same level it did before the announcement which caused the gap... Gaps don't always get filled and it's dangerous trying to trade or predict them... Trading the gap means that you anticipate that the gap will be filled, so you would sell your holdings near the top then buy them back near the initial gap level... Very dangerous strategy imo, because you may miss out on bigger gains...

    I have enclosed a chart on buddy to illustrate the 2 gaps recently... Gap 1 is just after the quarterly report which never got filled and gap 2 did get filled, possibly due to short term exhaustion after such a great run up in price... I would rather just ignore the gaps and don't try to trade them, because you may end up with less shares than you had before...

    Buy and hold and accumulate is what I believe with stocks like this...

    gaps.png
 
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