A Trade A Day

There’s just a ton of shorting opportunity out there right now. IFN is forming a bear flag and I intend to capitalize on any further down move in the stock. Let’s look at the chart:

This trade is pure text book. IFN has dropped considerably, all the way to its 50 sma. The 50 sma is historically a significant are of support. Because IFN has dropped almost 8% over the past 5 sessions, some rest is warranted. What I would like to see, ideally, is another session or two of consolidation and then a breakdown through the 50 SMA on heavy volume. Next stop is 200 SMA with a pause at 50. At least that’s how it plays in my plan. I would also consider putting a stop in at 48 once that support is broken.

Like I said at the beginning, there is a ton of opportunity, but you need to be smart. The Dow is down almost 5% over the past 4 sessions, and the Nasdaq is down 8% over the last 4 sessions and approaching its 200 SMA. The market is due for a rest of its own. That said, if the indexes powers down through support, keep your stops tight and keep selling. Down markets are great because the profits come quick and then its over.

Good Luck!

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