If you have found the perfect pattern of a pumped-up penny stock ready to tank back down to where it came from, it's essential that you consider the risk & reward of that certain stock before taking a short position in it. To fnd out the risk your taking and the possible reward you need to know the support and resistance prices of your selected stock on a 5 min chart. Once you fnd the resistance and support you should consider if a potential trade goes wrong, where is the next resistance point aka this is what your risking. Then consider if your potential trade goes perfect as planned, where's the next support line? If there is more % or $$ to the resistance than the support then the odds are not in your favor and you should look elsewhere. BUT is there is more % or $$ to the next support odds are then in your favor and you should go along with the trade. That is the basis behind risk and reward that can help your decision to short a specifc stock.