The Relief Rally - Posição Curta

O primeiro Setup para posições curtas

The Relief Rally
Market Type This setup is best used in:
• Bearish: strongly trending markets
• Bearish: weakly trending markets

Key Indicators In this setup there are three key ingredients:

• First, identify a strongly or weakly downtrending
stock that has rallied up into a downsloping
20 MA (strongly downtrending) or 50 MA
(weakly downtrending). If this moving average
coincides with, or is placed near, a downsloping
trendline placed over the highs of the downtrend,
so much the better.
• Second, there must be a sharp rise in stochastics
(five-period) to or above the overbought 80 line.
• Third, the price on the rally to that moving
average must have put in a bearish candle of some
kind (doji, engulfing, gravestone, hanging man,
evening star, etc.). If it has put in a green or
white candle (close above the open), then this is a
wait-and-see condition. You should make a note
to check that stock again the next trading day.
• Sell short signal: These three factors register a sell
short signal and the stock is ready to be shortlisted
as a valid relief rally setup.
The Screening Tool
• For the last market close:
• All stocks with . . .
• 60-day simple moving average of volume for today
is greater than 500,000.
• 60-day simple moving average of close for today
is greater than 10.
• The chart has a bearish engulfing pattern for
today.
• 20-day simple moving average of close for today
is less than 50-day simple moving average of
close for today.
• Daily close for today is greater than daily close
for five days ago times 1.15.

E é só...