AEO Follow Up

The AEO trade idea (short) is from Feb. 2 

It actually looks pretty good from a risk:reward perspective right in this area.

Originally we looked at a 2-day chart to find the pivot, but the trend cleaned up a bit and it's visible on a 1-day chart.

I would initially treat this as a swing trade and see how it reacts, it would be nice to catch another major 1 day move down.

 This is a weekly chart, RSI was warning right before AEO broke as it was negative on the top of the rally. Make sure you look at charts/indicators in multiple timeframes, what everyone else sees isn't worth knowing.

 With the Swing trade layout, this already triggered a swing short on Monday, if you use the volatility stop, then $14.27 is the stop area (I'd prefer to use intraday moves for entries in swing trades and for the most part, end of day prices for the stops.) You could also use a stop above the pivot candle's high around $14.65, it depends on your risk tolerance, but I think the tighter stop is what makes this trade interesting here, the risk is fairly low compared to the entry.

Interestingly, the Trend Channel has a stop at the same place as the volatility stop, around $14.27 and the break of this correction is just above $13.50.