Wednesday, May 07, 2008

Bear Flags - Perrigo Company (Public NASDAQ:PRGO) ; Sohu.com Inc. (Public NASDAQ:SOHU)

Short the market. Yesterday we rallied on bad news, so today we took it back with a vengeance.

PRGO was a bear flag continuation play from yesterday's earnings gap.

SOHU bear flag. This is obviously the trade of the day. SOHU, from the WL, was unbelievable, a trader's dream in that it never carved out a higher high all day.


JASO, also from the WL, carved out an inside bar at the base of support.

10 comments:

Robert Zotter said...

Very nice trades today.

Do you happen to use Nasdaq TotalView (Level II) or NYSE openbook?

How about T&S.

If so, how do you utilize these tools?

anarco said...

Glad to see you are still finding good setups these days. I took exactly the same entry on PRGO (the first one), but overall it has been quite slow for me.
Great work!

Trader M.D. said...

Awesome SOHU trade Jamie. I would have to say that even if I caught that I would have either partialed or closed out my trade before letting it completely run it's course like you did.

I'm just not on that level yet! :)

CTRP (another china related internet stock) could really pick up to the downside if it breaks below 63.

Anonymous said...

Great mother of pearl! Here I was (smugly) thinking that I had pegged a bigger trade than Jamie - my PTR short. Not. SOHU was an exceptional trade and you rode it to ground. Nice work Jamie!

TJ said...

Thanks RZ,

I do use NASDAQ total view to gauge market depth and spread. I rarely use T&S anymore. My philosophy is that the trade should work in my favor very quickly after entry, otherwise, it might be better to scratch the trade.

TJ said...

Anarco,

Didn't find many good setups yesterday because I already had in mind that we needed to retrace. Most of the early bear flag formations turned into bullish bottoms and I just couldn't bring myself to go long.

Today was a gold mine, because all the charts started breaking down.

TJ said...

Dave,

I've been waiting a long time for this correction, so I did try to hold on as long as possible. The nice thing about SOHU is the midday consolidation took place in the lower half of the preceding WRB, so I felt confident that it could go lower.

Thanks for the CTRP tip. I like the slope of the 50 SMA on the 15 min.

TJ said...

Jim,

LOL, Nice work with PTR. I see that it gapped down yesterday and, like most stocks rallied with the market on lower volume. A perfect segway to a sell off.

Anonymous said...

Where did you put your stop on the SOHU trade?

6th bar (15min) high?

TJ said...

Stop was $77.22, previous bar high plus 2 cents. This trade never tested the stop. It was profitable right away.