Everything on my short watchlist has set up or have nearly set up at a possible short sale point. Is this a sign? It has been frustrating to see stocks on the short watchlist rally stronger than stocks I am watching on the long side. However, it appears that we have been rallying into resistance. Here are a few charts, the comments are self-describing the possible set up. There is a common theme of a stock that has topped and is well into a downside move with a rally into resistance. Every one of these stocks trades more than 1 million shares per day on average. This is a requirement for my trading as thin stocks can jump too quickly in a short squeeze. We need Mr. Market to decide what to do, as these stocks could continue to rally if the market does. It appears the market is up in pre-opening trade this morning.
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