IRM - Probably Topped

IRM gap down today to break through trendline and 20MA which has lead to bearish price action previously.

I'm already short this name via LEAP puts as I think this will be a major top. It didn't quite reach my 2nd entry target.

Evening Star top appears also to be a Wyckoff UpThrust with declining volume.

The expanding structure appears to be a wave 4 and if this is a wave 5 completed it will be heading much below.

RSI close to trending in lower quadrant which would be bearish.

Earnings coming up that has had positive reaction previously, however I'm wondering if the trend has reversed also the earnings pattern will reverse.

Not advice.

Comment:

Any day now this is going to drop like a rock and earnings is coming up - coincidence?

Comment:

With indexes potentially bottoming I'm not at all content how IRM has bounced 6% in a day and although corrective upthrusts can be sharp, I'm now not entirely convinced the top is in and although I do think this will land ITM and have a big crash, confusion doesn't make good profit or good use of opportunity cost and there will be less confusing trades elsewhere, so I will wait to see this climb above magic retracement ratio 0.75 and if/when it hits 0.8 - i'm out. If you're following my work you should be able to find that ratio on your chart. If it falls back down then I will keep updating until I exit.

Also just to add that I think as I am improving my index awareness that I will not be holding shorts in phases where indexes are bullish and vice versa. This trade actually invalidated that standpoint because it was bullish as indexes were bearish.

Comment:

Well it looks like SPX has topped at 0.382 retracement which is very bearish and so unless it breaks above then IRM is a good short once again i think and so I have kept it open. Good day today, hopefully more downside to come.

Comment:

And now it looks very probable that the strong move up was a higher degree retracement and if indexes remain bearish then this should get to $45 in the next wave down.

But once it gets there I think it will probably continue on to touch the low of the channel, but I'll review when it hits $45 area. Obviously if indexes have an enormous sell of which could happen then IRM can break out of the expanding channel and down.

Comment:

Well indexes may be turning bullish and although this may pop again its looking like its going to run out of gas and so i'll just hold my short and see how it goes. Perhaps down the line I will change my strategy a bit, but my gut says this will land ITM sooner or later.

Comment:

Bit of the 'ol flip flip and i've exited out of this trade not too far from my entry. I will keep track of IRM but its not doing what I expected and I'm finding it more confusing than other charts. Also indexes may or may not bounce here so its not a great time to be holding with uncertainty. There are better trades elsewhere. However if this has a big pop I may look to re-enter.

Comment:

This is the one that slipped through the net and the reason why I let it go was that I had too much riding on it. Risk is psychological and I have a much more pleasant day when it is clearly defined.