The New Sell and Sell Short: How to Take Profits, Cut Losses, and Benefit from Price Declines, Expanded Second Edition

Question 32—Grading a Trade

Figure 3.32

This chart shows one of the trades in which I piggybacked a Spike pick.⁴ The weekly chart is not shown here, but you can see bearish divergences of MACD Lines and the Force Index on the dailies. The question, however, is about grading this trade: short at 90.71, cover at 87.99, upper channel line at 91.56, lower channel line at 83.67. What is the trade grade?

1. Trade Grade A: Over 30% of the channel

2. Trade Grade B: 20-30% of the channel

3. Trade Grade C: 10-20% of the channel

4. Trade Grade D: Below 10% of the channel