This is meant to be purely educational....This is NOT meant to insult anyone or be mean in any way. I DO NOT usually short stocks in a Bull market. It seems some people (....Vanzandt,...) like to SHORT non-stop in this market. What bugs me is when I see these people shorting stocks that have absolutely ZERO signs of rolling over. If I am going to short a stock I usually like to see the sector and the market dropping and the stock to be at the upper end of a trend line. It should be breaking that trend line to drop below it or at the top edge of a falling trend line. In addition I like to see technical signs that the stock is rolling over on several timeframes AT THE SAME TIME. I use weekly, daily and hourly time frames. I search for possible stocks to trade most every night and for the last several days I keep seeing this one pop up on my radar. BUT every time I look at it it looks like the perfect short if it were NOT in a sector that I think is going to go higher. So I repeat that I AM NOT SHORTING THIS STOCK. This is a paper trade just to see if my paper trade short in a strong bull market works better than the incesant shorts some people like to make calling tops on "pigs". I know absolutely NOTHING about this stock other than its a software company called SPLUNK. Nor do I care. Maybe SPLUNK is the sound it makes when it falls like a rock into the water. I originally saw this stock as a short on Dec. 14, 2016 and IF I had shorted it I would have done so at $56.28 with a Stop Loss at $58.72. Currently, the stock closed at $53.72. If I were to enter a trade like this now I would look for a better price to short like around $55.05 with the stop at $58.72 still. The following charts show my TA reasons and PURELY TA reasons for shorting. Notice all the down trend lines and that this stock is at the upper edge of a down trend line on the weekly, daily and hourly charts and with EMA 39 (a simple directional indicator) on ALL 3 time frames pointing lower. I have also drawn several trendlines showing lower prices are likely. Target price for this stock is around $37 to as low as $25. So, Lets see how it turns out,.....
Hey! I took Tesla LONG at $192 last week. And its a pig too. So there. Good post though. I know you're not slamming me. I just like fundamentals or lack thereof. What can I say. Quote of the day however... "don't fight the tape". Question is when is this bull gonna turn? Could happen tomorrow... or in 2018. One black swan and the R/R on the "pigs" goes astronomical.... way more so than trying to catch a few bucks to the upside in an arguably overvalued market. Especially when you have (for lack of a better description) a loose cannon taking over the most powerful job in the world...50% plus of the nation and 50% plus of our Congress.... hate him...ISIS hijacking trucks...a humanitarian crisis of epic proportions in Syria with no end in sight demanding our intervention.... Putin doing God only knows what... China jacking drones and building waterfront property in the S China Sea complete with surface to surface and surface to air missiles in the main channel of a waterway that sees 3 trillion/year in international trade float by....And lets not forget the friggin nut case with nuclear tipped missiles and a bad haircut that in all reality runs China's Southern National Guard ready to overrun Seoule SK at the drop of a kimshee jar .... Just sayin... don't believe everything you hear on CNBC. Dow 20K(plus much) is FAR from a given. One "Boo"... and its fire in the theater. You HAVE to always look at the bigger picture. T/A works well between Er's and on boring days. One "BOO"... and its all worthless. Those that don't learn from history....
You have given me many reasons YOU believe the market is over valued and about to tank but have YET to show one single piece of PRICE proving you are correct. The market is showing its a bit tired but very little weakness. Tired just means it may take a rest but a drop where its teetering on the brink of failure,....NO WAY anytime soon. NOTHING on the charts shows that to be the case unless you are looking at Gold and Bonds.
Also, you have been shorting for months,...I have been advocating staying long for months. Who has done better in this market you think? The Bulls or the Bears? I am simply trying to help you see things a different way. Open your eyes and your mind to seeing what the tape is showing you.
I could not agree more. And as long as nothing happens to spook the herd...we will be at 20K plus in no time. In fact, I think 20K is going to become the new support level after we see a rocket move up. I gotta be a realist here...The sky is not falling.
Follow this simple rule and I bet you will be more successful. NEVER short a stock that has a RISING WEEKLY EMA 39 and NEVER go LONG a stock that has a FALLING WEEKLY EMA 39. That is not the end all of TA and I do break this rule at times but its a simple rule to keep you on the right side of the market more often than not.
Go back and look at ALL of your losing SHORT trades in the last 3 months and I bet 90% or more had a RISING WEEKLY EMA 39
I will never forget that, its going into my bag of tricks. Seriously. Will add the 39 ema to my weekly charts before 930AM tomorrow. .
You gotta remember though Eg... alot of these trades that I post... are at THE MOST 24 hours. Its like today...KMX... I got in I think right at $64...and within two minutes it was like 63.60... which ordinarily I would have taken ($400 plus or minus) .... and two minutes later it was at $64.10 and I knew it was game over and I screwed up.... gave it a few more minutes, saw the writing on the wall... and bit the bullet at 64.35. Thats the way I trade...I may run commentary on a stock like CAKE or HOG... and they continue to rise... but trust me...I keep tight stops on my losers... and aside from 2007...I have not had ONE tax loss carry forward... and I bet very few here can say that. And one of the reasons for that are big scores when I do play an ER based on fundy's and common sense using options. If you note in the above weekly chart you posted... look at the 39 ema on June 27th and also sept 29th. Both rising EMA's ... but huge gap downs. ER related I'm sure. Those are big moves though. Thats where a strong knowledge about a company or an industry or macro factors can pay off big... despite the rising 39ema. But enough for tonight EG. I enjoy the exchange. (but did you really have to call it Vanzandts SPLUNK in the header). I wouldn't do that you. Oh well. hahahhah