$CCME dropped 33% today (chart/notes with fibonacci levels)

$CCME chart & notes

I've often asked how do you play a stock that gaps down or continues to drop intraday. Very often there is a few nice bounces as you'll see in the chart i posted below that provide good sell points off bounces as well as good places to re-short a weak stock.

 

If you focus in on : 

Key $ levels, Volume, Fibonnaci Levels & candlestick patterns It will help you have a more successful trade on these plays.

I didn't play this stock today but did provide some nice bounce points to the 38.2% fibonnaci levels 2 times & almost hit it on the 3rd bounce it had.

I find its a good way to play stocks that are still downtrending intraday and can provide some nice entry points & exit points using the Fibonnaci levels.

Those fibonacci levels also provide a good area to short from . As you can see from the notes on the chart it gives some nice key levels to watch for when you don't know where a crazy stock like this can go. News will always trump and chart and these chinese stocks seem to be having a lot of problems the past year with fraud so they are dangerous plays.

But hope you find the strategy useful for other trades in the future that are those

"Falling Knife type plays" 

The strategy has worked well for me in the past many times as long as you keep tight stops and you are aware of key support and resistance levels such as the $14 and $10 levels we saw today on $CCME

 

Hope the notes are helpful,

Stockguy22

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Posted in Commentary, Stocks