Will the recent lows hold?


The QQQ short term down-trend completed its 12th day on Thursday.   It is so nice to be in cash!   The big question is whether this base will hold or start a new leg down.   Stay tuned….

3 thoughts on “Will the recent lows hold?”

  1. Dr. Wish,
    I’ve read your blog for a while and was wondering, you always go to cash when your indicators tell you too, but you do not short. Any particular reason why not? Do you have certain indicators that do lead you to go short at all?

  2. I have been reading for a long time and wondered the whole year why your trading was completely off when iall i saw from march onweards i one gigantic top! Please throw these indicators in the trash. they are useless

  3. Hey Justin,
    I can tell you from experience that shorting is much more of a headache because of the volatility that is involved with the stock.The price swing on the short side is very wild because the majority of investors(and even institutions) tend to want stocks with value and tend to buy stocks on the way down. Very few people short and so the bears at the beginning of a stock’s demise is very few. Hence, the stock has high volatility. At some point in the stocks downtrend people get tired the stock and dump as they realize no money is to be made. If you are going to short a stock, make sure you time your entry as precisely as you can and always set 20-30%profit and cover your trade if you reach that range and wait for another opportunity to enter. I really like O’neil’s book How to Make Money Selling Stocks Short as this will help you build a foundation on shorting. I had to read the book a four to five times to understand exactly how O’Neills method worked. Finally, A last few words of advise if the short doesn’t go your way let the stock hit your buy to cover stop and wait for the next opportunity to short it again because a stock that is a short candidate tends to want to rally and then fail a few times before continuing downwards. Essentially, persistence and patients is key when shorting a stock.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.