My friends and foes to the long side seem a little more jubilant lately and that’s because trades to the long side are working more as the market heats up. But the joke is not on shorts. What goes up must come down and everybody wins when volatility shows her kind side.
Listed stocks have particularly gotten hot as a result of $DWAC and $PHUN which are addressed in a video here. Also, I’ve been working on playing a later part of the pattern, which I’ve discussed in an older blog here. Ironically, the market is staying hot because these same plays are now offering bounce opportunities.
The 15 minute chart of $PHUN is particularly interesting because when the multi-day down trend breaks… guess what? Big squeeze. These dip buy opportunities provide insane range, $PHUN bouncing from the 3s to the 5s being case in point – that’s 60% of upside to capture. Did I capture it? No, none of it, because I still suck at the long-side, but I’m working on these plays as they repeat over and over.
One of the hottest stocks of the week is $OCGN. It’s been in play for days now and is putting in its first red day after gapping up pre market, today (Nov 3). Buying the breakout (Nov 1) in the 13.20s was choppy, but ultimately it paid $3 bucks but is now reversing.
When markets get hot, you can easily get tricked into thinking everything is going to run – and to a degree, everything almost did run in Jan 2021 – a wild period. But this isn’t the case now, which is creating a number of lay-up short opportunities to go after. They may be bloopers that dupe longs, but they can be ATMs for shorts.
Stocks like $BAOS can go from the 5s to nearly the 1s in the space of hours. I caught around 15% of this move, a huge percentage win but it pales in comparison to the bigger picture of the move.
The market is, again, presenting a lot of opportunity for longs and shorts and it’s a game where everyone can win if you follow the rules. Rule number one is cutting your losses quick. Cutting losses quickly means you always stay in the game and you can always fight another day.
A trader without discipline is no trader at all – I know from personal experience.
If you’re looking for a broker that specialises in short selling and trading to the long side, you can use my affiliate link to receive discounted fees whilst gaining access to the hottest, hard to borrow stocks.
Otherwise, stay safe and try your best to follow the rules. We’re only human, but if you can follow the rules it’s a fun party out there right now and you’re personally invited.
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