While the US stock market is closed on the weekend, let’s talk about Sandisk $SNDK
Sandisk’s performance these past few days has indeed been strong—an ongoing rebound pushing it close to 1800, and it has also reached a key level.
Sandisk’s stock price has repeatedly been rejected and fallen near 1800, but no one can guarantee this time will be the same; however, for Sandisk, I’ll still keep a bearish mindset—selling on the highs.
Let’s talk about my trading plan: I intend to enter a short position around 1820, at the resistance level that repeatedly capped price earlier. I’ll keep the position size lighter, because the stop-loss is clearly farther out, at the prior high of 1988.
But having a far stop-loss doesn’t necessarily mean the risk-reward ratio is poor. If the bearish scenario plays out—if Sandisk is rejected again at 1820 and then falls—that would indicate that the recent month’s action has only been a pullback within a larger-scale downtrend.
If that also triggers a new round of decline, then this drop won’t be as shallow as merely testing 1500—1200, and even 1000, could be reachable targets.
Using a medium-sized position to bet on the second wave of a Sandisk selloff at the daily-chart level—I think it’s a pretty good deal.
NFA, DYOR!
Sandisk’s performance these past few days has indeed been strong—an ongoing rebound pushing it close to 1800, and it has also reached a key level.
Sandisk’s stock price has repeatedly been rejected and fallen near 1800, but no one can guarantee this time will be the same; however, for Sandisk, I’ll still keep a bearish mindset—selling on the highs.
Let’s talk about my trading plan: I intend to enter a short position around 1820, at the resistance level that repeatedly capped price earlier. I’ll keep the position size lighter, because the stop-loss is clearly farther out, at the prior high of 1988.
But having a far stop-loss doesn’t necessarily mean the risk-reward ratio is poor. If the bearish scenario plays out—if Sandisk is rejected again at 1820 and then falls—that would indicate that the recent month’s action has only been a pullback within a larger-scale downtrend.
If that also triggers a new round of decline, then this drop won’t be as shallow as merely testing 1500—1200, and even 1000, could be reachable targets.
Using a medium-sized position to bet on the second wave of a Sandisk selloff at the daily-chart level—I think it’s a pretty good deal.
NFA, DYOR!
