PCLN Follow Up

I don't know what it is about PCLN that has captivated so many people's interest in trading it short, perhaps it's a revenge trade or because it is up so high, the assumption is it has the most to fall, remember that points are points, but 20% of $10k is the same in a $5 stock or an $1100 stock.

That being said, your patience with PCLN and waiting to short at the right spot, waiting to fill out that short at the right spot (still hasn't happened) will be handsomely rewarded, I feel 95% on that statement so long as your tactical entries and trade management are good, PCLN will offer the points, it's up to you to capture them.

That being said, we have been very patiently waiting for PCLN to cross above $1200 before filling out the partial position that was started. I CAN'T BELIEVE PCLN didn't take out $1200 when it was so close, $1200 is akin to Dow $10,000 when it's trading at $9,990, heck CNBC would buy it just for the story and headlines.

Having a partial position short PCLN, we do appreciate this down side, but most of us would like to fill out the position to a full size core short.

I don't know if we get $1200 or not, I can't imagine that it passes it by, but I do think the current nasty price trend is going to bounce which may be intraday or a couple of days, it's not clear because the set up is just starting to form to hint at the probability, it's no where near mature or strong enough to give us much more than that.

 This is the $1200 area, we still aren't far from it and still in a range.

The longer daily chart shows the trend is your friend, that is right until the end when it starts to bend which PCLN has done in not making that higher high. Even of PCLN does make a higher high and hits our >$1200 expected target to fill out the short position, the damage of not making that higher high is done, the trend is sloppy when it was crystal clear, and that is reflected in 3C as well.

 What I'm looking at is the capitulation type price move and capitulation like volume, this is not true capitulation as in "End of a stage 4 decline", but the market is fractal and this smaller stage 4 decline looks like it's moving toward a stage 1 after capitulation from many longs. There's also rough support in the area. Normally I'd look for that support to be broken in the stage 1 process, but it's hard to expect that with timing factors in play.

The rounding price action after a steep decline, we would call this a "Process" and likely a reversal process, but keep in mind the scale, this is not a daily chart, it's a 5 min chart so whatever stage 2 move is made is proportional to the stage 1 base, which means it  really isn't a concern on the daily chart other than the area we have been looking for (+>$1200)

The intraday 3 min, like many of the averages as mentioned in the market update, is positive in this process so this is what I was talking about last night except on a more stretched-out time scale.

I could show many charts much shorter than this 60 min chart that are negative that give you a feel for just how far PCLN can move on the upside, it's not much, it "may" be enough to hit +$1200, but we've had much stronger positives that failed to do so.

The point here is PCLN had PERFECT 3C confirmation on a very smooth, clean uptrend, then 3C gives a hint of distribution and PCLN stutter steps and then a large reversal process (WHICH MUST BE LARGE IF IT IS TO BE TRUSTED AS IT HAS TO BE PROPORTIONAL TO THE PRECEDING UP TREND) has taken hold and 3C has shown an exceptional level of distribution.

I believe there's a 95% chance PCLN is SMOKED, but again in the simple wisdom of Jesse Livermore, "Being right and sitting tight are a rare combination of traits in traders".

Just because PCLN offers the downside, doesn't mean we/you/I have the guts to take it, "Being right and sitting tight"...