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DAVE Short Trade Setup Entry Criteria Revised

I've slightly revised the trendlines that were shown on the recently posted DAVE Long Trade Setup. The yellow lines on the price chart show a bullish falling wedge with the white downtrend line as the top of a descending price channel.

DAVE 120-minute Dec 16th

DAVE 120-minute Dec 16th

DAVE (Famous Dave's of America) remains an aggressive trade setup with the stock in a relentless downtrend but poised for a potential short-squeeze/counter-trend bounce. It appears that DAVE has made an impulsive breakout of the bullish falling wedge pattern (yellow lines) on this 120-minute period chart with the stock up over 9% so far today. The trigger for a long entry will be revised to any move above 7.92 although there is a minor-to-moderate resistance zone not far overhead which runs from about 8.05 to 8.20. As such, one could also wait for that level to be taken out before initiating a new position or adding to a partial position taken on a move over 7.92.

Price targets remain as previously shown (T1-T3) with a suggested stop on any move below 7.50 (or higher, if only targeting T1). Due to the above average gain/loss potential on this volatile stock, a downward beta-adjustment of 50% of one's average position size is suggested.

 

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Dec 16, 2015 2:34pm|Categories: Uncategorized|Tags: |Comments Off on DAVE Short Trade Setup Entry Criteria Revised