Due to the consistent selling of the last 2 weeks, it is getting harder to find breakdowns that offer significant promise of further price depreciation. In other words, there are many issues that are oversold. While the temptation to wait for a bounce before selling is logical, I’m sure many traders have had no problem over the last few months buying new highs. In this market, one might just be rewarded for selling new lows.
Ideally, our breakdown setups will have failed at both the 50 day and 200 day moving averages. TUP is an exception (it is still trading above the 200 day), and has been included because there are simply not many other setups that are not oversold. TUP did fail at the 50 day, and in this market it seems natural that the next stop may be the 200 day, which coincides with an area of previous support. Setting a stop above $34 and covering at $29 would provide a 3:2 reward/risk ratio.
 Note: since the consumer has been declared dead, how many house honeys are left to buy Tupperware?
JOYG is just an ugly chart. Normally one should avoid such issues. However, ugliness may work in our favor. In this case, JOYG has failed at both the 50 and 200 day averages. All recent gaps have been filled, and support is 8 points lower than Monday’s close. Remember, what we are looking for in our short setups are charts that show exhausted bulls. JOYG’s trading over the last several months has definitely raked the bulls over some “coals.”
A stop above $54 and a target of $42 gives a reward/risk of 2:1.
I like these.
I will likely hit both tomorrow.
woodie,
Of the two set-ups, I would prefer TUP as a short.
jog on
grant
Grant, why TUP in particular.
Really, I liked JOYG better. TUP looks like it could bounce between 29-33 with no rhyme or reason while JOYG looks destined to hit and fail at overhead resistance.
To me, the better chance I am right + better risk/reward too = JOYG.
Wood,
I like the setups but does the fact that TUP is a defensive name play any part in your analysis?
woodie,
Absolutely no reason at all……just looking at your two charts, that’s the one I would feel more comfortable putting a short on.
jog on
grant
just put both of them on … wtf
I covered GES and EMN first thing this a.m. Those were both great trades.
I’m holding off on any more shorts til a little later today. I just want to see what kind of legs this relief rally might have.
Although TUP looks like it is stalling, as does JOYG. I think Juice that you might have had some good entries.
Kid, I understand that TUP is a defensive play. I did not really consider anything other than the chart for that particular play.
However, I know that if my income/spending/employment is affected by a slow economy that the wife surely will not be out buying a bunch of stuff at Tupperware parties.
Juice, I hit both. Got TUP above 33. Good times.
JOYG lives in a shitbox.
woodie,
Both these are up today, although, TUP less than JOYG.
T/A real 50/50 stuff.
jog on
grant
Grant, 50/50 is better than I’ve been doing lately!
Very bizarre. JOYG is another company I worked with back in my New York days, when they merged w. Harnischfeger. That’s two in two days. The stock is highly unpredictable, stay on your toes.