Frequently Asked Questions
Q: I just listened to the webinar, and I wanted to confirm that in layering you are willing to average up when putting on a short position because it violates what many, O'Neil included, believe is a cardinal rule that you don't add to a losing position. Is that true?
A: We short into rallies, we don't short downside "breakouts" as they don't work the same way as upside "breakouts." And unless you can pick out the exact inflection point in a reaction rally within a downtrend, you can only massage your way in. You can't simply apply principles on the long side to the short side in such a pat manner.