Spotted the following Tweet recently for measuring when Stocks are extended to the LONG side….

In a nutshell if a Stock is Extended X multiples of its ATR% from the 50d SMA, then perhaps it’s ‘Extended’

ATR 50dSMA

I was reading the Tweet from the point of view of being long….. but then thought maybe there’s a MOC Short system in there somewhere….

I don’t trade Short, but thought I’d share the idea here….. I ran a couple of quick backtests and it performs in the 12% ROR -15% MDD…. with a circa 53% PctWins

Those that trade a Short MOC, probably already have the ‘theme’ covered…. but who knows it may offer another layer of uncorrelated setups etc.