I bought CXRX this A.M. at $6.34. This was meant as a day trade do to the sharp fall in the last 2 days. Here’s what happened though
The break above the long descending channel from 9/5 would be the confirmation of a reversal under normal circumstances, but here we have had a sharper selloff for the last 2 days. Volume doubled yesterday as well, all of which indicates panic. Panic is a great indicator of a reversal.
My intention here was to sell at the high of the day which was $6.63 at that time. I sold one third there and another third at $6.92. On the rest I put in a stop at $6.49 and will hold unless stopped out.
As you can see on the 5 minute chart CXRX is holding in the upper third of the days price action. If it holds in the upper half and closes green for the day I think CXRX will reverse here. A hold in the upper half and a green day should change the sell bias on this stock.
It still needs to break the long channel at about $7.12. Bear in mind the number will come down as time pass’s.