The DOW made a nice turn around today, bouncing off of support near 11,000; however, I am skeptical how many times this floor will hold. Hence, I feel like it’s time to start looking at short picks. Here is my first:
Symbol: SNHY (Sun Hydraulics)
Trade Details:
Market Forecast
- Overall market is in a down trend
- I expect 11,000 to be tested again, and broken in the near term
Security:
1. The uptrend line starting in February was broken, tested, and confirmed
2. The Fibonacci 50% retracement level didn’t hold up at all
3. This week has seen the 50 and 200 day EMA broken
4. There is a significant divergence between the MACD and price.
5. 1-2-3 bearish trend reversal indicated on the Aroon, PPO, and Williams %r
Intermediate target is 27.02 which is a 9% move,
Long term target is 23.96 (3% above the 78.6% retracement level.
Stop is 3% above 200 day EMA - 32.84
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Posted on Friday, 5th September 2008 by Steve Warshaw
Tags: pick, short, stock, symbol, tip
Posted in Stock Picks & Tips, Technical Analysis | Comments (2)
September 15th, 2008 at 8:50 pm
not a bad pick, considering it was off almost 10% today…good call on the 11k floor too. You think this was the start of a 1k point plummet?
September 15th, 2008 at 9:49 pm
Thanks Brandon…
Here’s the funny thing about both the DOW and the NASDAQ. Even though today we hugely bearish, IE massive down day on high volume, fresh sell signal on the MACD (DOW), closing on the low of the day, etc, we still didn’t break through the mid July lows. In essence, today hasn’t given us a clear signal, but COULD be setting up the move to the downside. If we see follow through tomorrow below 10815 on the DOW and around 2175 on the NASDAQ, then Id say we’re ready to test late 04 / mid 2005 between 9800 and 10000.