Sunday, April 13, 2014

Trade Alert: FB

Facebook FB looks to be a risky short, but one well worth taking if you play it right. Notice how facebook broke the $60 support level on Friday April 3rd and has hovered there since closing out last Friday 11, at $58.54. The slow stochastic which was headed up has stopped dead in it's tracks and is now turning over.

Short 10% of your position with a stop at $60.542. Then if you get stopped out you don't get hurt to badly. If facebook crashes you will be in a position to add to the short as it falls.

So, if you trade 100 shares, you would risk only $20 on the trade, but the upside could be $58, because make no mistake about it, Facebook is heading down to the pink sheets where it richly deserves to reside. Will it be this time or the next? There is no way to tell, but it is going there and you want to be fully short when it goes.

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