Let’s talk parabolic shorts because they are starting to pop up on this overextended market. The parabolic short is an excellent play for reward/risk because the downward moves can be so great!
The ideal setup:
1) Straight upward move = Parabolic = ‘U’
2) Outside the bollinger bands – A must have!!!
3) Gap up in the morning
4) Weakness intraday – play when it crosses over yesterdays close – green to red
These things can drop 10-20% over 3 days!!!!!!!
Discuss in the forums! http://www.shareplanner.com/forum/swing-trading/179-parabolic-shorts.html#179
