It didn't take me much time this morning to add a new position, and I did so by shorting Hawaiian Electric (HE) at $28.44. The stock is forming a very nice head and shoulders pattern this morning, and the only drawback to this play is that it hasn't broken the neckline of the aforementioned pattern. So that does increase my risk, but my reasons for seemingly 'jumping the gun' is to to keep risk tight in case this market does continue to rally, but provide my a hedge against my existing four long positions that I have (I also have a short position right now in BRO).
Just because things are looking well-overbought, and a number of my indicators that I follow are showing the same thing, doesn't mean I'm going to front run this market, in hopes of timing that reversal. Instead, I just want to curb my exposure as much as possible, tighten up long stops, etc .
Here's the trade setup in HE.