SPY breaks grind. Will it get bought or continue selling?? Trade Ideas for Wed Aug 20
Perfect planning for the short yesterday. Did you catch 100-200% gains? BONUS: PREVIEW of /ES Futures Trade Plans.
Good morning!
Yesterday I wrote that I wanted to short 643.30 and after rejecting 644, we got the short I was looking for into SPY 639!
Remember this chart from yesterday?
So we dipped deeper than the first support I was expecting and in premarket we reached 637. This more or less is putting us into a backtest of the last break out level.
Let’s go over how to trade yesterday’s action and the go into ideas for today.
SPY/SPX
Morning Setup: FAILED BREAKOUT REVERSAL
Ok so perfect level to level planning. 644 was rejected. put in lower high broke vwap, then broke 642 and we dumped to 639!
I used /ES for the short instead of options because I was worried about decay. But given a 6415 downside target 6430p would be optimal.
Here is what they did.,
I was shooting for 15-22… they went all the way to 30! from 4-5 AFTER confirmation of the vwap break.
There is massive opportunity in this market. Are you taking advantage? Literally have planned and alerted trades that pay over 300-1000%! You will need patience to wait for entries and the exits. But if you have self discipline or trust bracket orders, my process can help you get the results you want.
What is Two Hour Trading?
Two Hour Trading is my system for finding and executing trades while spending less than two hours a day trading. My goal is to earn 100-300% on the capital I risk while waiting for 1000%+ gain trades to set up. Key benefits include:
High-quality trades with excellent reward vs. risk
Avoiding overtrading and losses from it
Trading to win vs. trading not to lose
Stacking the deck in your favor
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Education
How to Join a Strong Trend
The process I typically follow for joining a strong trend are as follows:
All day grinder: join on dips to 20ma
Multi-day grinder:
Join either on support test of morning lows or failed breakdown reversal at key level
Join at VWAP mid day or end of day
Keep it simple. Don’t chase, wait for support levels for great risk/reward entries!
Systematic Profit Taking
How do I take profits? I keep it relatively simple. Depending on the entry and range to the next levels I typically with take profits 50-100% of my profits at 3-10R and then raise stops to above entry with a goal of letting runners take me to the next level or 2 and to then reload if I believe we are consolidating before the next leg.
I then repeat the same process on the reload.
Securing Profits on Options overnight
Sometimes you get this massive paper gains overnight on options but you can’t secure it right? Well if you have a big enough account and a margin account if you have calls you can. What you need to do is buy or sell the stock overnight. and the option turns into a hedge against that position essentially securing your profits.
Trade Ideas - Plan for Wed Aug 20
Stick to process. The process and trade setups I teach works. Rinse and repeat over and over again. There will be losses. Any good system will have them. Being systematic also means the gains will repeat and come again too. If you keep changing your system/process trying in an effort to never lose a trade, you will never get to where you want to go.
Ideas
We had the first big red day in a very long time. In theory we should get another red day. I’d like to see 637 or 636 turn into support on SPY.
SPY
Current Market Context
Breakdown confirmed: Price has broken through multiple resistance levels (641.50, 642.60, 643.30, 644.10, 644.80, 646.10)
Volume spike: Significant volume on the breakdown suggests strong selling pressure
Support test: Price finding temporary support around 637.20 and 638
4 Trade Plans
1. Short-Term Bounce Trade (Conservative)
Entry: Around 637.20-638 (current support level)
Target: 639 (previous support, now potential resistance)
Stop: Below 636.80 (below the 627.20 support)
Rationale: Oversold conditions, support at key level, potential mean reversion