As I pointed out on jaiku, a box play was forming on Goodrich Petroleum Corporation (NYSE: GDP) basically all day. It had a decent 20 cent target and healthy volume. If you can forgive one kind of loose touch, it actually had 6 touches to the boundaries before breaking out at the 7th touch. And, they are fairly evenly spaced, which is more important than you might think (with all patterns like these, you really want the price action to “fill” the space they are taking up).

At the time I alerted people to the play, I thought it would break out to the downside. I was kinda disappointed about that, because all kinds of moving averages live down there, and you never know when some dip-buyer will get excited. Luckily, I got a break to the upside right at the end of day:

As with most end-of-day box plays, the target wasn’t hit. But, I wasn’t stopped out, either, which is nice. AND, I got to use a stop tighter than the box-width, since it based a little at 33.25ish before breaking out. Not too shabby.

Since embarking on the box play, I have never lost money on it. I had one break-even trade in March, but that’s it! I heart the box play.

Stocks Mentioned In This Article
Stock	Links
GDP	| |