You short a stock when the price trend turns lower and not before. Dell's trend is still solidly up, so IMO it's not a short.
The Fool does not know how to trade. The Fool held IOM long from the 50's down to 13. Would you do the same? They are not a good example to use.
For a short term trader, the "max gain is 100%, risk is limitless" argument is moot. On a given trade, if your looking for a few points, it doesn't really matter if the stock goes to the moon, or to 0, because he's not looking for that much anyway.
One of these days, dell will start breaking pretty hard, or it will lose 15-20% in a day, lower tops will form, etc. Then, start looking to sell the rallies.
Look at some stocks that got killed early this year (coms,nscp). There were good short term shorting opportunities even after the main trend turned lower. |
