In yesterday’s post I discussed a few core principles we teach at SMB and used VRSN as an illustration. This morning it was lighting up the SMB Radar again in multiple categories. In case you didn’t have alerts set on your trading platform at the prior day’s key levels the Radar almost forced you to pay attention again.

If a stock is unusually strong the prior day we set alerts at key levels as often these prices offer good setups on Day 2.  My two favorite “areas of interest” on a stock that was very strong the prior day are the afternoon low and the high of the day. Both are prices where traders who missed the move the prior day are willing to jump in.

On the Open today VRSN had a strong drive and blew right through 33 which had been the prior day’s high. My price alert was triggered in VRSN but I was short GLD at 176.50 looking for a multi-point down move. GLD is a stock that requires your full attention so I didn’t flip over to VRSN right away.

By 9:45 I was comfortable with my GLD position and started stalking VRSN for an entry point. It had already traded as high as 34 but I was not concerned. One of the principles I mentioned yesterday was that if a stock is VERY In Play you don’t have to be in the first move or even the second most times. Eventually I got long at 34.03 and caught a move to 34.50.

I was off the desk by 10:30 so missed the best setup of the day. VRSN consolidated for about an hour at 33.50. It then began a new uptrend at 11:30 and ended topping out above 35. I observed from my office that a few traders on the desk caught the move, although most with too little size (work on that guys).