ICLD one of those low float name that had a big 75% run on Friday and gapped up again on Monday. After 2 days of huge move, naturally many traders including me had eyes on it for parabolic short. If you took the leap of faith and shorted the morning gap it worked for you. But our bread and butter, intraday setup became a bit dicey after the first pull back. You can always try to take a few shorts just to taste the water with tight stop . Only issue is, lately ,this low floater stocks are running for days via short squeeze and float rotation. VLTC, CHOP to name a few. So do not be stubborn and stay short if the trade goes against you. We shorted a few at 3.25 and covered it at 3.21 when the trade didn’t work right away. For this type of float rotation stocks (ICLD has 14 million outstanding shares and it traded over 37 million shares today), If they stall or drips at crack spot,that should be a cautionary tell as short keeps piling on , it does not take a lot to trap those shorts , bring in fresh buyers and run again. After we stopped ,many in chat went long in this stock at 3.40/3.50 area for nice gains. Let’s an intraday chart to dissect the setup.
1.Gap after huge volume run Friday. Worked well if took a leap of faith and shorted the gap up.
2.Now we wait for an intraday set up. Stock was making a higher high and higher lows. Notice how every little spikes were fading off but stock wasn’t making any new lows. 3 tap on higher high’s and 3 tap on higher lows. There were no flush, If you were short in this, this is your cue to exit as we did in chat room and look for a long entry.
3.All the moving averages and VWAP finally caught up to price and that 3rd tap down trapped some more shorts but stock didn’t flush.
4.Stocks breaks out off a tight flag pattern , squeezing all the shorts and bringing in fresh new buyers and the new uptrend begins.
Stock ended up gaining over 53% for the day on top of 75% gain on Friday !
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