Large One-Day Gains After Stock Market Corrections
Large one-gains in the indexes can give you the feeling that you are missing out. Just remember, the largest gains in the usually occur during corrections. A 2.9% gain on Oct. 16 put the Nasdaq composite back above its 200- moving average (2). Though it was enticing, it quickly failed.
Follow-through Days Using Swing Trading Strategies
Follow-throughs are a stronger signal than a single one-day gain. That’s where you get a powerful gain on volume heavier than the previous day on day four or later in a rally attempt. It confirms the initial strength of a one-day gain and suggests the market correction may be over. But they don’t all work.
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