LNG was on the watch list for a short setup.The stock is in oil/energy sector, one of the weakest sector in the Market now. Stocks on this sector are in a down trend and they should fade into resistance.
Stock is in a downtrend and it had a decent dead cat bounce off the recent lows. Down trending stock will ofter find resistance in previous support or moving averages.So i was eying this stock for a fade into 20 MA or 50 MA.Let us look at a intraday 5 minute chart to explain various ways you could have traded this stock.
1.Gap down open for stock. Often time when a stock gaps up or down, you need look for an intraday setup. For long play after a gap up, you want to see some pullback , for short play , you want to see a dead cat bounce after a gap down.
2.Stock gets a quick bounce into the moving average and fades away.For aggressive seasoned traders this 70 area is spot to initiate a short position.
3.If you want more confirmation you can short the open range break (ORB) here.
4.If you missed the ORB break short, stock gave another opportunity to short on this failed retest of moving average.
5.Another short opportunity on another failed retest of moving average.
As you can see the stock trended down all day. If you managed to short at 70 and held to the lows , that is decent $4.3 gain per share for the day ! If want to learn more about this or many other trading techniques on how to trade momentum stocks for fast gains with low risk , you need to join our 60 day Bootcamp course. Our program is designed in such a way that you come out of it ready to trade live in just 3 months. We teach you everything from risk management to scanning to trading strategies. I also share my profitable intraday trading strategy which will make you money short term regardless of Market condition. The class is one of a kind, see why you should sign up for the course here . You will also have access to a private community where you can ask questions, share charts and talk with the instructors or other traders.
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