Two tempting short setups — but one is hiding real dangerWhich pair would you short?
We’re looking at JCPB/BAB and AGG/GTO , both showing positive deviation and riding the upper Bollinger Band.
At first glance, both look ripe for a short… but dig deeper, and you'll see very different stories.
🔹 JCPB/BAB
Chart:
Low ADX, balanced DI+ / DI− → classic setup for a mean-reversion short.
But the last daily candle is a strong bullish bar — big, green, and decisive.
This could be the start of a breakout , and shorting into fresh upside momentum is dangerous.
Looks neutral — but hides bullish potential.
🔸 AGG/GTO
Chart:
Clear uptrend: DI+ dominates, price marching upward.
Also touching upper Bollinger Band, so yes — shorting here is fighting the trend.
But at least the risk is obvious , and you can frame the trade accordingly.
Transparent trend = measurable risk.
🧠 Bottom line:
JCPB/BAB may seem safer — but that green candle changes everything.
AGG/GTO is clearly trending — risky to short, but less deceptive.
👇 So, if you had to short one of these — which would it be?
Drop your take below. Let’s hear your reasoning.
Pairs-trading
TECS/SSG Potential Long OpportunityTECS/SSG pair is signaling a Long position at the close of yesterday, supported by multi indicators, suggesting a promising opportunity.
ADX : Indicates no trend at present.
Correlation : remains very high in the last few weeks.
Close price : closed below lower BB.
Historical test : I would be happier with more historical opportunities in the last few months to test, but generally it seems okay.
ZSL/JDST: Potential Long OpportunityZSL/JDST pair is signaling a Long position at the close of yesterday, supported by multi indicators, suggesting a promising opportunity.
ADX : Indicates no trend at present, and a quick look at the daily chart confirms it.
Correlation : remains very high in the last few weeks.
Close price : closed below lower BB.
Historical test : I would be happier with more historical opportunities in the last few months to test, but generally it seems okay.
OHI/SBRA: Potential Long OpportunityOHI/SBRA is showing a signal for a long position starting today, and all indicators support what appears to be a promising opportunity.
ADX: Indicates no prevailing trend in the pair.
Correlation: Remains high.
Price: Positioned in the oversold area.
I will monitor the market throughout the day and make a final decision on this trade by the day's end.
FANG/EOG: Potential Short OpportunityFANG/EOG is showing a signal for a Short position after the end of yesterday, and all indicators support what appears to be a promising opportunity.
ADX: Indicates no prevailing trend in the pair.
Correlation: Remains high.
Price: Positioned in the overbought area.
New pair trading opportunity today?VGK/EXG is showing a signal for a long position starting today, and all indicators support what appears to be a promising opportunity.
ADX: Indicates no prevailing trend in the pair.
Correlation: Remains high.
Price: Positioned in the oversold area.
I will monitor the market throughout the day and make a final decision on this trade by the day's end.
Trade Recap: MEDP & LSCC - 24/4/24 to 25/4/24Market Context and Indicators (Closing of 23/4/24):
Directional Movement Index (DMI):
* DI+: 42.59
* DI-: 11.53
* ADX: 19.75 (indicating a weak trend)
Stochastic Oscillator:
* %K: 94.34
* %D: 98.11 (both in the overbought territory)
Correlation:
* MEDP & LSCC: 0.8852 (strong positive correlation)
Trade Information:
MEDP Position:
* Position: Short
* Entry Price: $415.00
* Exit Price: $406.00
* Duration: 24/4/24 morning to 25/4/24 mid-day
LSCC Position:
* Position: Long
* Entry Price: $70.39
* Exit Price: $72.35
* Duration: 24/4/24 morning to 25/4/24 mid-day
Analysis and Strategy:
Given the strong positive correlation of 0.8852 between MEDP and LSCC, paired with the overbought levels of %K and %D on the Stochastic Oscillator, we identified a potential reversal opportunity. The ADX at 19.75 suggested a weak trend, which further supported the hypothesis of an imminent price correction.
Trade Outcome:
* MEDP: Achieved a successful short trade with a profit of $9.00 per share.
* LSCC: Achieved a successful long trade with a profit of $1.96 per share.
These trades exemplify the effectiveness of leveraging correlation and technical indicators to capitalize on market movements.
Key Takeaways:
Utilize Correlation: Understanding the correlation between assets can provide insights into potential price movements.
Monitor Indicator Levels: Overbought and oversold conditions, combined with trend strength indicators, can highlight profitable trading opportunities.
Adapt to Market Conditions: Weak trends, as indicated by ADX, often present good reversal trading opportunities.
Stay tuned for more trading ideas and market insights!
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