Gapper Retracement Trade - Emergent BioSolutions Inc. (Public, NYSE:EBS)

EBS is a perfect example of a gapper retracement trade. Price spikes higher on the open after trading lower in post market trade on Thursday. It then retraces back to the R-zone, where it carves out a mini C&H, before expanding and retesting the early reaction highs.

FSYS faked me out before setting up for the real extension. I have to pay closer attention to level II when trading unfamiliar stocks. This is a low priced stock with a wide spread. I didn't take that into account when sizing my trade. Anyway, not a big deal because I had plenty of winners.

I traded the same core WL stocks as Thursday - V, IDCC, and POT for some more downside extensions. POT gapped in to the R-zone of the PDH to the PDL, printed a cluster of bearish sticks and voilà. The target on the daily was $65.00 which matched up perfectly with the FE.