Short squeeze setup can be very profitable. The key is to time the squeeze to catch the short term momentum. Today's CMCM is a good example. I was in at 15 around Dec-22-2014 with a stop at 14.7, which is the lowest of the consolidation. This setup had a very good risk-reward ratio. There was an initial bounce on Dec-26 which shows some confirmation. However, it sold off next day when reaching around 15.7. For this kind of trade, I need to take profit quickly. But I was stopped out around 15.2 with min profit. After that, I "hated" the stock and removed it from my watchlist. Today, what a good day for CMCM!
For a stock with daily volume around 500k. The average volume on each 5 minute bar is around 15k = 500k/40. In today's 5 minute chart, CMCM had over 100k in the first 2 bars. This indicates buyer coming in. Now CMCM sit right below 50SMA. This is at a perfect price to take profit.
What a pity! I missed this one. This happens. To have this kind of trades working needs luck and close monitoring the price/volume action.
These days I was also in and closely monitoring YNDX. Today YNDX broke down. So either ways!
The short squeeze play needs some new/catalyst.
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