Realistic Spread Determination

[carltonp 10]

Hello Traders,

 

My first post.

 

Can someone please tell me how does one determination the realistic spread that can be achieved for a stock?

 

For example, depending on how my strategy pans out, I plan to purchase ESRX for $53.33. My target price is $55.76. Therefore, the spread is $2.43. I would like to reach that target by Friday.

 

I would like to know how do I determine if that is a realistic objective?

 

One school of thought is the ATR for the stock.

 

Any suggestions will be greatly welcomed.

 

Cheers

 

Carlton

[SIUYA 11]

the only thing that will statistically tell you that is historical examples....

of course past performance is no guarantee of future performance.

ATR is a good measure, the context is not too bad - requires experience.

Fibonaccis are often used (also often ridiculed).

Pick something that you use and understand - learn how you apply it - and then be consistent

[carltonp 10]

SIUYA,

 

Thanks for responding.

 

Very good advice.