06/21/2022
I keep seeing article after article about “All-Weather Portfolios” and “What to Invest in During a Bear Market.”
Sentiment is clearly bearish.
But for short term traders, this has been a great time to be in the market…
Short Sell the rips. Cover Buy the dips.
There’s one problem with this though… Not everyone can monitor their trades all day, every day.
What’s the strategy then? Lazy trades.
(Source: giphy.com)
Look, the worst feeling isn’t lost money, it’s missed money…
You can always make back what you lose, but it’s the opportunity to take profits on a parabolic run that’s fleeting.
Right now, accumulating bottom plays with set price targets is a great way to win…
I’m looking at Eargo, Inc. (EAR):
This is the 65-minute chart covering regular trading session hours.
There’s not but so much to notice on the daily, so I’ll just sum it up:
Shorts have crushed the stock since the beginning of 2022 all the way from $8.55.
Is the bottom in?
Most of my personal trading has been options on the SPY, but I still enjoy the lower float small cap trades. And EAR is one that came across my desk late last night.
This one is simple.
The intraday movement shows heavy algorithmic trading, so the action is a bit boring… until it isn’t.
Support is being built around the $1.00 mark, although I’d caution anyone to be careful setting stop losses too close. The machines are created to sniff them out and supports break all the time.
As for Resistance, the daily has none until over $3.00. On the 65-minute chart, however, it’s worth swinging some shares to the $1.20’s if you were to keep a core position and swing the rest closer to $1.50.
All Fibonacci EMAs are stacked to the downside, but notice their direction. The longer term EMAs are pointing downward as the lower time frame EMAs are beginning to curl with the share price leveling out… potentially.
This is the type of trade where you’re attempting to capture a bottom and scaling in is important.
Chris Hood’s Squeeze Trading Tool 1.2A is still without a signal, but the histogram is trending higher and so is the Squeeze Stochastic line.
I’d keep it small and average up on a move above the daily 21ema.
Under $0.80? I’m out.
(Disclosure: I hold no position in EAR but intend to initiate a position in the next 30 days.)
This material is not an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Any performance results discussed herein represent past performance, not a guarantee of future performance, and are not indicative of any specific investment. Due to the timing of information presented, investment performance may be adjusted after the publication of this report. There can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this communication will be profitable, equal any corresponding indicated historical performance levels or be suitable for your portfolio.
