Yelp Inc.Short
YELP breakdown but can it fill the gap?
Initially, when I saw the gap down on YELP, I thought this stock looked good to short for a near-term gain. I usually concentrate on the weekly and daily timeframes and, with the gap down breaking through previous support, the $50 half figure and with higher volume, this looked like a great shorting opportunity - as there appeared to be no further support for some time.
But a quick glance at the monthly chart showed a gap up in 2013 - at the same level YELP is trading right now. If this is an island reversal pattern then we should continue to see price fall - as analysis from the daily timeframe suggests.
But, as I was considering YELP as a near-term opportunity, price could drop too fast - possibly gapping down again past the lower value of the 2013 gap up ($42.84). This means I may not get a position filled at the price I want.
The safer option here is to wait for price to trade below $42.84. If this is indeed a reversal island then price should continue its bearish move down beyond this point.
But a quick glance at the monthly chart showed a gap up in 2013 - at the same level YELP is trading right now. If this is an island reversal pattern then we should continue to see price fall - as analysis from the daily timeframe suggests.
But, as I was considering YELP as a near-term opportunity, price could drop too fast - possibly gapping down again past the lower value of the 2013 gap up ($42.84). This means I may not get a position filled at the price I want.
The safer option here is to wait for price to trade below $42.84. If this is indeed a reversal island then price should continue its bearish move down beyond this point.
Web: dt.live
Instagram: instagram.com/dynamictrader
Twitter: twitter.com/dynamictrader
Instagram: instagram.com/dynamictrader
Twitter: twitter.com/dynamictrader
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.