XOM Reminder

I'm at a bit of a loss until this screen capture software re-initializess, it usually takes about 10 mins, so about 5 more.

XOM is a core short position, I've had it open for a a while and the fact that it is right around break even shows that it was entered (phased in to) at some advantageous areas that were "high probability, low risk areas", I wouldn't be able to hold an energy short as long as I have this one if it wasn't entered in a good area which was in fact based on what smart money was doing, this wasn't my guess as to where to enter, I'm just following the signals and trying to act when smart money is acting.

In any case, XOM looks like a large top. I think the best case "entry" scenario is that this local support in the $91 area which has been broken, may provide for a sling shot move higher (this is consistent with the short term bounce theory) and that may put XOM in the $93.50 area. I have a little dry powder to add to XOM and I'd wait for that opportunity to do so.

I'll try to get some charts of some of my favorite core short positions like DE which has been doing great out of a huge head fake / triangle top, IBM rolling over in a large rounding top, PCLN which I think has just run out of goodwill sentiment that they can do better moving forward in this economy, AMZN which is toppy anyway (look at a 5-day chart) and has come to us as we patiently waited on this one), and NFLX as well as others.

I think XOM has a realistic minimum (trending position) target of $55, but we can leverage the trade up as an equity short, which I explain in this article I wrote some time ago, the argument made by the Peter Lynchs of this world that short selling has unlimited risk and limited potential simply isn't true.

The unlimited risk is handled by your broker as they have skin in the game and will close the position without you even knowing about it long before it gets to any scenario approaching "unlimited risk concern" and as for the argument, "You can't make more than 100% and that's if the stock goes to zero", is just wrong and shows a total misunderstanding of how margin and long and short positions differ.

This is my article that is quite old, but still valid, "Making More Than 100% on a Short"


It looks like my software is back up and running.