I've initiated my first short trade in more than a month, not because I think this market is going south anytime soon, but I do believe that there is an opportunity to make a profit off of an obvious overbought market. As a result, I want to protect some of my existing profits without having to sell those longs and in doing so I shorted Perrigo (PRGO) this morning as it is forming a nice bear flag back into resistance from its prior breakdown level.
My entry price on PRGO is $113.26.
I'm not looking to hit a home run off of of this stock (though I'd gladly welcome it) instead, if I can net 4-5% off of this trade, I will be thrilled. If that can occur over the next 4-5 days I will jump on that immediately and will cover without hesitation.
Ultimatley this is a buy the dip market and I currently have 5 long positions, but while the market dips (assuming as much) it doesn't hurt anything to profit with a short position as well, without violating the bullish outlook that I have for this market.
Here's the Perrigo (PRGO) trade setup.