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Do you go long a stock covered in a short sale report?

Full question: Would you go long on a stock that was flashed by a short seller report, like MuddyWaters? ( Assuming of course it has a nice setup!)

I don’t care much about what Muddy Waters, Citron or even Einhorn have to say. According to my experience the price and volume signature of individual stocks allows you to reliably judge the quality of a setup at hand .

Being able to read a chart correctly is a hard learned skill after all and worth a lot more than some forecast based on fundamentals. Citron bashed $GSX but the stock simply resolved higher in 2020 and topped via easy to see bearish price and volume clues.

This kind of stuff is exactly the type of misleading noise you want to avoid.

When a stock is acting constructively on a technial basis despite being “featured” in one of those short seller reports it actually increases the odds of having a strong and actionable swing. Such a swing is then backed by strong hands as the weak ones probably have been succesfully pushed out by the report. You also want to be aware of potential hidden agendas.


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