Oil driller Resolute Energy ($REN stock) has been on a tear the past 2 months ripping from $3 to $20. We have been watching the price action on this stock like a hawk the past week. Patience is key in shorting small cap runners.
After the past 7 trading days, we felt it was time to initiate our short position in $REN. There was excessive bearishness from almost every stock trader on Twitter saying they are going to short it (or was already short) so we had to stay cautious as stocks usually move against the majority sentiment.
We shorted $REN at $19.50 and added to the position on weakness as it descended. Our timing was spot on and we swung the position overnight into today as we expected more profit taking tomorrow morning as the stock did not close very strong. Covered pre-market as well as during the first 15 minutes of trading for extra gains.
Net Profit: +$4,674