Trading Halts

[Nick1984 10]

For stock traders/investors trading halts to a particular stop can be a bit of a heart in your mouth experience. You're effectively locked out, stuck, can't do anything. Lots of people get very trepedicious if there's a trading halt. Could the stock have received a speeding ticket? Is there are share placement happening? Is the trading halt ordered by the listed company?

 

Sometimes trading halts are ambiguous as not enough information is given out to the market regarding the halt. The example I'll use now is of a Biotech company called Avexa Ltd listed on the ASX. They management voluntarily ordered a trading halt on its shares. In my experience if a company has voluntered to have a trading halt this is good news, most likely an important forthcoming annoucement and/or a significant share placement is about to take place to a preferred investor. Check out the daily chart to see what happened to the price following the resume of trading on 19/3/2007. A gigantic gap up in price followed by a small sell off. Great news if your holding!

 

 

If there is a situation where there is a trading halt like the one described above I've found that its good to watch the orders being placed during the halt to see how the market will view the halt. You can very often get a good indication if the halt will bring bullish or bearish news. Many long term holders will have taken the huge gap up as an opportunity to sell off and take profits, and new entrants will be there to buy on these new highs (suckers born every minute). So what strategies Do you have available? Personally I always think that you can short these new highs and take advantage of the profit taking. Most of the time this is an easy way to make a few bucks

 

Anyone else have similar experiences? Good luck guys!

[notouch 10]

I looked up trepedicious in the dictionary but it's not there. It sounds like such a good word though.

[torero 10]

Main Entry: trepidacious

Part of Speech: adj

Definition: afraid, fearful

Etymology: from trepidation 'fear, anxiety'

[The Bear 10]

For stock traders/investors trading halts to a particular stop can be a bit of a heart in your mouth experience. You're effectively locked out, stuck, can't do anything. Lots of people get very trepedicious if there's a trading halt. Could the stock have received a speeding ticket? Is there are share placement happening? Is the trading halt ordered by the listed company?

 

Sometimes trading halts are ambiguous as not enough information is given out to the market regarding the halt. The example I'll use now is of a Biotech company called Avexa Ltd listed on the ASX. They management voluntarily ordered a trading halt on its shares. In my experience if a company has voluntered to have a trading halt this is good news, most likely an important forthcoming annoucement and/or a significant share placement is about to take place to a preferred investor. Check out the daily chart to see what happened to the price following the resume of trading on 19/3/2007. A gigantic gap up in price followed by a small sell off. Great news if your holding!

 

 

If there is a situation where there is a trading halt like the one described above I've found that its good to watch the orders being placed during the halt to see how the market will view the halt. You can very often get a good indication if the halt will bring bullish or bearish news. Many long term holders will have taken the huge gap up as an opportunity to sell off and take profits, and new entrants will be there to buy on these new highs (suckers born every minute). So what strategies Do you have available? Personally I always think that you can short these new highs and take advantage of the profit taking. Most of the time this is an easy way to make a few bucks

 

Anyone else have similar experiences? Good luck guys!

 

The worst though is when you get caught in a halt. And your on the wrong side of the gap. It's happened to me.

[Nick1984 10]

Curse my spelling! English isn't my first language hehe. And my damn reliance on spell checker! :o

 

Cheers for pointing clarifying that Torero!

 

Bear, yea its a tricky situation. If the price opens again on a high then shorting is a really good option and most of the time has shows to yield a gain. On that particular stock the price has retraced back to 0.77c as I type this.