Swing Sell Alert

The Swing Sell strategy identifies shorting opportunities in stocks that are in clear downtrends on the daily chart. In addition, the stock must be experiencing a minor rally within the context of this downtrend. The final trigger for this alert is when the stock price breaks below its prior days low, signaling the small rally is complete and the downtrend is being reasserted. The following charts show an example of the type setup we look for as a Swing Sell opportunity

Example:

WorldCom Inc., WCOM, has been in a clear downtrend for several months and is experiencing a minor rally. During this time period, TradeSeeker monitors the stock movement looking for a breakdown, a point when the stock price breaks below its prior days low.

The instant WCOM trades below its prior days low, TradeSeeker generates a Swing Sell alert. The following chart shows what the stock did after the alert was generated. As you can see, the stock reasserted its downtrend and continued to lower lows.