I was going to ask about that one(VOL) - first break of 50 day MA, but tons of down volume in chart.    Not too risky here?   I'm guessing just use a stop above the 50 day MA?

I'm interested in seeing what others come up with tonight.    I am looking at CAT of course, ET, UCO, BLK, LAZ(needs more volume) and TS.

I also have some that I am just waiting for to break down on volume:  ATI, BBD, GOL, IIIN, ISE, LDSH, NUE, RIO, WCC, WFR, WIRE.  

Josh, how do you set your orders for stops?   Is a sell short limit order, do you give it 50 cents or so of room like O'Neill talks about in his book?    I will look on your blog too to see if you put the answer there already.   Thanks.

VOL: Yes, 50 dma for stop.

I give myself some room. For instance if a stock closes at $10. I will go short at the market on the first uptick in the morning to establish a position, as long as it doesn't gap away too far then a stop is activated and no trade is made. ie....STX today. Gapped down and all short orders were canceled.

I also then set a limit short sale order at the closing price the previous day. Either it hits it or it doesn't. If it doesn't hit it, oh well. That normally ONLY happens if it gaps a little down and doesn't make it back up to the close.

But didn't I say if it gaps down the short is cancelled? Yes I did. The gap has to be a big gap. If it is .50-1.00 (normally .5%-2%) away from the close then the stop doesn't get hit obviously.

STNR HAWK CAT ARII CBG CPE CFC VOL KG RMK KMR

I am going short all of these if I can get shares. And normally I can 99% of the time. They have enough volume and I have 3 brokers. One always has some to borrow.

Watching to see if they do crack but don't fell comfy with them: UCO FLR DTV

So for instance, with CAT, I would set a sell short limit order for $68?   That would get me filled as long as CAT doesn't gap down below $68?

And for instance if I wanted to short a stock only if it hits a certain lower price, I would set a sell-short stop order at the "pivot" price?  

Sorry for these questions, I know they are pretty basic, but I usually am around for the first thirty or so minutes of trading and can get enter market orders, but I won't be around early on the next couple of days, so I am not used to using pre-entered orders.   Thanks a lot.  

68.52 is where my limit is going to be.

mac, just look at my charts. Take the short from them. It is simple. Keep it simple. I always trade off the closing price.

If you are not used to entering pre market orders, make sure you first know how to do it. I recommend not trading until you understand your platform.

Sell Short Limit CAT 68.52. If it opens at 68, you will miss it. If it opens at 68 then crosses 68.52 then you get it. If it gaps up to 69 you get filled at around 69.

Hi All,

TOL for a short candidate.

Piercing thru 50 DMA on a double the average volume and is living below 200 DMA.

Your thoughts please.

This is my first post and will hang out here.

Best Regards.

There is only one problem with these shorts is the fact that TOL is already down some 60% from its high. I think it is too late in the game to short the homebuilders. Yes they may fall some and if you want a quick short this might work out. But I don't see the big swing on the downside that I see in my other shorts because they are just now breaking down from the top.

Homebuilder shorts might work out but you are really really really late to this game. I wouldn't short TOL here, if I had your money.

Welcome aboard Nani. I look forward to your contributions. If you would like to introduce yourself to everyone you are more than welcome to on our "getting to know you" forum.

Great luck out there!

figures, i dont get filled on shorts that have deteriorated all day - ie- CBG good short.....and got filled on shorts like VOL that are up on volume. (although i was think i might be early on VOL for a short since its hasnt reversed/tested at 50dma,etc....) but we will see.......time to close my quotes screen

Scottrade told me that there were no shares of VOL to borrow this morning - I guess I'm lucky in that one.    A lot of the shorts I was looking at yesterday(GOL, LDSH, LAZ, IIIN, ET, ATI) look like they are reversing now and don't look as attractive today.   This market is still super frustrating - we just can't seem to get a sustained move down.   Yuck,

hey mac, i use scottrade for the account i bought VOL in and i got filled....i must be extra special client or maybe you are swinging too big of size to get filled .........alot of those shorts you listed above havent really shown the large distibution days yet to make them attractive enough even if they have bounced on light volume(they could keep bouncing higher)- would be nice to see some big selling 1st.........also, oddly regarding ET i have noticed the broker dealers/money managers have been pretty strong bounce in the last couple weeks relative the mkt - they were 1 of the 1st groups to fall and they fell really hard so they are bouncing right now with many regaining 50dma so that sector is kind of no mans land right now..although OXPS is struggling to regain 200dma again-i would short OXPS though if we see a big distribution day or reveral at the 200dma

I entered the order before the market opened and it said there were no shares to borrow - it was only 100 shares.    Who knows?  

Yeah, I am waiting on them to drop lower on big volume, but I think they're setting up in the O'Neill pattern of a big break followed by two or three tests of the 50 day MA on weaker volume.   This is the main pattern I have tried to look for.  But I keep waiting, and waiting, and waiting for that big breakdown.

Brokers have indeed bounced in the past few weeks but I think a lot of the bounces seemed to be on weaker volume, like ET.    I took a shot at OXPS a week or so ago, but was stopped out.   I think they may be setting up for some shorts, but like you said, only with a big volume break lower.   Even BSC, probably the best looking broker, is very choppy with a ton of volume at the bottom of the base, not a good thing.    

ORKiter: I did not get filled on CBG either. It gapped down and never came back up to my order.

VOL: I got filled.

yeah i really like CBG short set up but missed it today - that's good example of your comment above about testing/failing 50dma multiple times.......yeah i am still bitter not shorting LM when i saw it reveese at 50dma and gapped down- i figured it would bounce back for better entry but never did. oh well. that was when mkt just started cracking so people werent looking for shorts yet, oh well - there is still many,many stocks that are forming longer term tops that have lots of downside potential when you look at the weekly charts. i jsut got the Oneill shorting book, still need to read it

"how to make money shorting stocks" by ONeil is a simple quick read. YOu will finish the reading material in one day.

What I love the most about the book is the TON of examples of some great shorts from former high flyers that were supposed to do nothing but go up. These examples start at 1966 and go all the way to whenever the book was written. I don't remember. I LOVE THE EXAMPLES OF PAST WINNERS BECOMING GREAT SHORTS IN BEARISH MARKETS.

I recommend everyone get this book. If not for this bear market....for the next one.

yeah that i why i really enjoyed Boik's recent book regarding all the prior decades where stuff blew up and its just history repeating itself.....