rx4pain,
Regarding RIMM, nobody will ever call you stupid for booking a 50% profit. Personally I think RIMM has a bit more downside, and will very likely have a bearish market environment to help it along. But I agree that the 5-3-3 is getting towards oversold territory. I think I would give it another day if it were me, and if I had time I'd watch the intraday and cover as soon as it successfully challenged the 200 min ema. Another alternative, and maybe the best of both worlds, would be to close half the position at the open, then let the other half run, watching the intraday on a 15 minute or 30 minute chart; as long as RIMM is trading below the downsloping 200 min, keep holding; as soon as it tests it successfully, close the position. That might be a couple more days, can't say for sure. But that way, you combine strategies: book profits, and let your winners run (if they will).
But whatever you do, congratulations on a very nice trade. And when you do close the position, I'd re-load, and wait for another correction upwards, and re-short with the same criteria as before (particularly if RIMM can rally back up to the long term moving averages, where it has a very, very high likelihood of failure IMHO). RIMM has a lot of downside potential, IMHO.
I'm less enthused about PFE as a short. For one thing, I don't like the shadows below the recent candles, and for another, I don't like the fact that it is currently trading above the long-term moving averages (though not technically in an uptrend entirely).
If you look at the 12 month chart, you will see that after reaching a 52 week high, PFE settled into a long trading range/basing period. The longer these periods, the more explosive the potential breakout, and PFE already gave one head-fake breakout to the upside in mid-December:
askresearch.com
These "head fakes" typically presage the direction of the ultimate breakout from a trading range, and so I would look to take a long position on the next breakout from this trading range to the upside, which will be more likely to continue now.
These trading range stocks can often be very good candidates for trading using Bollinger band signals, e.g. go long when the lower rail is pierced, sell at the midpoint; go short when the upper rail is pierced, cover at the midpoint. There are other possibilities, but the point is that a range-bound stock will typically move from rail to rail, though it often will also find resistance and support at the midline. So, if you trade the rails, be wary at the midpoints and ready to close the position; at this point technical strength/weakness can often be very helpful in deciding whether the midpoint is likely to be traversed, or will represent a reversal point. The rails represent very high likelihood of reversal, the midpoint less so.
207.61.23.99
JMVHO.......
WS |
