Stocks that exhibit a rolling pattern are known as rolling stocks; rollers or channeling stocks, are bought at their cyclic low and sold at their high for profit.
Often, stocks reach their high or low for the day in the first 20 minutes of trading. Do you see what's wrong with this picture? These investors are a day late. They're reacting to yesterday's news. Now, after this goes on for about 20 minutes, the day traders come in. Let's assume they've been holding yesterday's hot stock overnight hoping to get a little more profit in the morning from the amateur buying. What do they do now? Well, they sell into all this buying, increasing their profits (at the expense of the amateurs) and driving the price of the stock back down. This can go on for another 10 to 20 minutes.
After that, the stock will start moving up or down as a result of today's trading. If the stock starts moving in your direction, that's the time to buy. (This is not to say you should never buy near the open, but you should wait to see how the stock opens and make sure it has found a trading range. I would say that you should never put in a market order before the open.) One other thing to keep in mind is that most options don't open for trading until the stock has traded for fifteen or twenty minutes. If you place an order before that, you can bet that you'll be filled at the highest possible price.
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