What distinguishes a POD is that it a) generally occurs in a “hot” stock that has a blistering upside run first, and b) it consists of a relatively sharp break followed by an equally sharp rally back up to the prior highs. The duration of the most effective POD formations is 15–28 weeks, although some can be longer, particularly among larger-cap leaders. In other words, relative to the steep price run-up where a stock may have easily appreciated several hundred percent and on the way up had its share of normal corrections, which in turn spawn constructive basing patterns from which the stock emerges and continues its upward price run, the current base is too deep and too short, so it is highly fai...
- CHAPTER 3: Short-Selling Set-Ups: Chart Patterns for the Dark Side
- from Short-Selling with the O'Neil Disciples: Turn to the Dark Side of Trading
- Publisher: John Wiley & Sons
- Released: April 2015
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