Question from YTC reader:
I traded ZIOP a few times today (I will attach the daily, 30 min and 3 min which are the charts I use below) I entered on the fourth 3 min candle right after the pullback and set my stop below the low of day. It was a good trade and I rode it to the resistance area on the 30 min chart.
My question is when does this become a short play, a safe short? Is it once it breaks below the open? Below the swing low? Or is there something that could have lead you into a short as soon as it didn’t move over the highs and made a lower high?
I ended up taking a short after the first pullback once it went below the open price around 8.86, in the afternoon. It worked out well however I always have trouble getting into shorts early in plays that were longs and reversed.
Thanks, I hope I explained it well. Basically I just want to know where you would consider the trend changed and a short trade be the higher probability trade.
Attached Charts:
(The following are the daily, 30 min and 3 min charts as attached to the original email. I’ve added an overlay to the 3 min chart though, so that it shows the approximate location of the trades as described above – these were not on the original attachment so the exact entry location may vary slightly from what is shown.)
Reply:
Happy Trading,
Lance Beggs