I See A Shorting Opportunity Here
Martek Biosciences
(
MATK |
Quote |
Chart |
News |
PowerRating) has a number of parameters
setting up for a short opportunity. Let’s walk through a few time
frames and look at price action.
First, take a peek at the
MONTHLY chart below. The monthly of June saw MATK complete a Bearish Butterfly
pattern into a Fibonacci price resistance zone.
Second, we also have a Bearish
Butterfly pattern on the WEEKLY chart below.
Finally, the question is
this…so how do I trade it? On the DAILY chart below we have a high that was put
in on June 17 of 49.19, followed by a 20% sell off into June 23. However, the
recent rally to retrace .618 to .786 of the hard sell off completed Friday.
Check out the June 27 candlestick with a large tail and reversal. My service
last night communicated that I would be shorting this one if further weakness
developed today. So, I got the market action I was looking for and I am now
short this stock with a stop above 47.00 which is the .786 retracement level.
My objective on the trade is
the .618 retracement of the C to D move on the Monthly chart. That retracement
price objective is approximately 26.50-27.50. Regardless of the final objective
one thing is a given. I have a stop in place and I will take partial profits as
the trade moves in my favor to lock in some and let the rest move to my
objective.