Strategy Description: Very similar to when really bad news comes out that you expect to fade off for quite a while (E.G SEC investigation, but obviously this isn't that bad). The initial spike happens from the algo's.
Ultimately the goal is to establish a position from a position of strength with 3/4s locked in and then hold the rest for a flush (which can sometimes create a buyable bounce opportunity, but not in this case).
After initial spike looking to short only strength as it spikes around with quite a bit of volatility. The strength of the bounce off the initial lows should be a pretty good tell (for example the other day ADXS never paused in it's retracement, whereas TWOU only ever retraced 30% of the move). ne problem is that you DON'T want to be stopping out on this, which is why you need to short strength with a starter and add as time passes, finally getting full size as you are confident the retracement is over (which in this case was about 10 min after initial downmove and was tight to lows).
Lock some into down move, then lock a bit more. Ultimately you want to size down reasonably quickly, but then hold some for the "real move" which could arguably be a swing position.
Note: Especially if looking for a bigger move, watch for either company responses and/or sell side defences. Also how it reacts to the defences can be a good tell.
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