@szaman here. Today we traded VELT in the chat from 4.02 and the stock made a high of 4.90.Lets review the trade.
VELT Is one of those highly shorted stock with over 30% of the float short. As you can see on the daily chart, stock is making a small inverse head and shoulder pattern with price resistance at 4.07. So I set an alert for 4.07, idea is , heavily shorted stock if it breaks 4.07 it should make a decent run.
Click on the intraday chart and see the notes.
1.Stock opens at 3.90 and makes quick thrust to 4.09. My alert triggers but I can’t chase the stock now so I wait.
2. Orderly pullback to rising 9 EMA and whole number 4 holds and a higher low. This is where I become interested. So Long at 4.02 with tight stop below 4 around 3.98.
Stock trend up higher all day to 4.37.
3. This is the second entry. Now we have a intraday base break at 4.37! All the day traders/scalpers/long term shorts who missed the first move piles in here as it breaks 4.37, causing it thrust higher and parabolic move to 4.90.
If you held the stock from 4.02. You have almost 22% gain in 1 day! If you bought the intraday break 4.37 , its 12% gain. Not bad for a days work!
Hope this helps.
