here is an example
last monday crude oil was at 58
and after about 2h reached 57
see picture
so for a day trader or scalper calling short was the right signal
but others will wait 2 days when priced reached 60
to criticise the signal
…and still others will go long at 57…
1 Like
If you mentioned the target then no one would criticise your signal.
Going short means borrowing shares and immediately selling it ,hoping to scoop at a lower price ,returning them to the lender and pocketing the difference. It is a strategy that is recommended for advanced/experienced traders.
To open a short position , a trader must have a margin account and will usually have to pay interest on the value of the borrowed shares while the position is still open.
To close a short position a trader usually buys the shares back at a price less than the borrowed and returns them to the broker /lender.
Short selling has a high risk/reward ratio, the profits can be huge but losses can mount up quickly and indefinitely.
He basically wants to sell
Trader looking to profit from downside price movement by opening a short position “sell to open” with hopes the market moves lower and than close position “buy to close” to take profit. Your risk is upside movement. Theoretically endless! There is a difference in shorting and the meaning of “margin” in Futures and Forex markets vs equity markets. What pete_pips88 is referring to is the equity markets.