A low priority update on a short position I just took. The setup looked good enough to use as a chart study, if nothing else. I am not an accomplished short seller and cash continues to be the favored method of playing bearish markets, so there are your caveats.
PYPL has had a sharp bounce back to the SMA 200, where I shorted it. I’ll probably give a stop loss leeway to 84 or maybe 85. But the snap back has come on low volume and the chart has a bearish look to it with the SMA 50 pointing downward.
The weekly chart shows a negative divergence by MACD & RSI at the September high. It also looks like it has the potential to form a big Head & Shoulders top, which could screw up the trade in the short-term because a shoulder could grow as high as 87 or so.
Regardless, it’s not a nice chart for PayPal. I’ll be interested to see what comes of it. If this thing tops out the target is below 60.
A reminder that chart based NFTRH+ updates are technical trade setup ideas, which may not be revisited as the buy, sell, stop parameters are already noted. They are meant as a starting point for your further research if interested. I will not personally buy every item highlighted and will sometimes sell (ref. Trade Log) any item that I do buy below target (assuming I’ve not stopped out or sold for some other reason), which is something I often do as a trader. Also please be aware that I am not a fundamental stock analyst. Due diligence is your responsibility.