VIPS Trade on May 12, 2015 11:43 from foldelinio_BOWS: Tradervue User Stock Trades.

Heavy inraday action on seeking alpha PRO article.

Stop: 25.80$
R: - 1.2

Good find, poor execution. Actually this was the first time I've seen a setup like this.
Stock was already down and consolidating for almost an hour ready to make it's next leg down.
Then a seeking alpha PRO article was announced on twitter. Nobody knew the content, but a leak indicated that the company were likely to use some fraudulent methods to cook their books and the stocks value was close to zero.

I watched it for a while and suddenly the tape exploded. Serious size was trading on the bid, like 100K - 300K blocks, which actually represented seven figure bets. I was like "wow, this is it, those guys are no Sissi - daytraders" and started to load up in order to get a full size position below 25.80$ the breakdown spot.

My greed totally killed my position average and I totally discarded all risk principles.
25.80$ was the spot everyone was short from and I had no chance to honor my stop when it spiked above.

The company came out with the usual defend speech the next day, saying that they were alright and they are willing to fight those shortsellers. Thus I will have an eye on the newsflow of the stock, because if the news are on point, there is huge downside.

As a summary I have to say that I probably would do the trade again. The trade management was a little over the top, but the same day the $ESI rumor of an SEC investigation hit the tape and the tape showed the same pattern...the stock lost half its value in an hour, discarding every technical inflection point. So there is definitely a huge reward for the risk. Also the tape showed confirmation, so yes, I would do it again.