After a successful short term short trade, I am eyeing ZM for another potential short, but nowhere close to the current level.
Don't get me wrong, I believe that Zoom is highly over-valued. But it would not be smart to try to gauge it's movement, long or short, currently.
Prices are shooting up due to expectations on a positive earnings report that is due Tuesday close.
You may be tempted to short ahead of earnings, because I am too.
But that would be too risky, even if you short today and price immediately slip 20% after earnings. Hindsight doesn't alter the risk you have taken.
Risk is not defined something that is defined after the facts, rather, before.
So, what if stock sank 10, 20% after earnings?
- as a trader, you should not think, 'damn, I should've shorted', because you couldn't have known the outcome.
- you only knew the risks. You lacked something to trade off of, and thus if you had traded, you would've been gambling.
- If you bet all of your money on a coin flip, and had you won, you got lucky.
- You didn't, and weren't capable of, predicting the outcome. And thus regardless of the outcome, I would call anything stupid to bet their life saving on something like a coin flip.
Where does ZM go from here?
- I don't know
- I hope it goes to 246.7 - that's where I would closely watch for a short, because that's where I am most comfortable with the risk/reward.
- If it doesn't get there, I am perfectly happy, nothing lost.
- But I do not want to get involved in what is currently a bubble that has the potential to suffocate you or blow up in your face.
Follow for updates.
Careful trading!
Don't get me wrong, I believe that Zoom is highly over-valued. But it would not be smart to try to gauge it's movement, long or short, currently.
Prices are shooting up due to expectations on a positive earnings report that is due Tuesday close.
You may be tempted to short ahead of earnings, because I am too.
But that would be too risky, even if you short today and price immediately slip 20% after earnings. Hindsight doesn't alter the risk you have taken.
Risk is not defined something that is defined after the facts, rather, before.
So, what if stock sank 10, 20% after earnings?
- as a trader, you should not think, 'damn, I should've shorted', because you couldn't have known the outcome.
- you only knew the risks. You lacked something to trade off of, and thus if you had traded, you would've been gambling.
- If you bet all of your money on a coin flip, and had you won, you got lucky.
- You didn't, and weren't capable of, predicting the outcome. And thus regardless of the outcome, I would call anything stupid to bet their life saving on something like a coin flip.
Where does ZM go from here?
- I don't know
- I hope it goes to 246.7 - that's where I would closely watch for a short, because that's where I am most comfortable with the risk/reward.
- If it doesn't get there, I am perfectly happy, nothing lost.
- But I do not want to get involved in what is currently a bubble that has the potential to suffocate you or blow up in your face.
Follow for updates.
Careful trading!