SPY creates indecision candle yesterday! Trade Ideas for Fri Aug 08
The levels I typically look for for reaction worked, extended, recovered. IMHO Bulls and Bears are fighting and SPY is net in consolidation before next big move.
Good morning!
Missed the initial short yesterday by being stubborn and waiting for the first hour to complete. Then tried long twice and both times, it failed. The led me to flip bias and change plan and focus on the short. And that paid!
We then got an afternoon squeezer, but my targeting/math was off and I missed an easy 10-20 bagger! I’m so over due! Let’s see if today brings it.
Given its Friday, if range break comes on SPY, we could get some wild payouts on names such as AMD, TSLA, META. Let’s review the action from yesterday and then I’ll share today’s ideas.
SPY/SPX
Morning Setup: Textbook 2 level gap up reversal!
I botched this. Super clean trade setup. I had orders in, but I was too stingy. If I got the delay to 10:30am, I would have got filled on the price I wanted. Its annoying when use miss an entry over $1!
Text Book Short setup. I originally had a plan for a gap fill / 10:30am reversal of SPY 633 so I went long even though action was bearish. I stuck with my plan. And stopped out for small loss/break even.
Once I recognized the short, I alerted I wanted 6320p for $3 and I got that fill exactly around 11:25am.
Here is how it did.
Afternoon Setup: 4 Level Movel Failed Break Down Reversal
Overall I botched the execution on the long. I got worn out. The playbook/setup said go long but I did the first time and then got stopped and after that was burnt out. However I did end up take bull puts that on SPX 6320c/6315c thanks to Edge scanner and those went to 0.
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.
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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 Fri Aug 08
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
I expect today to be tricky / choppy at least until a trend forms. So I’ll be patient on SPY. Especially given yesterday’s indecision candle. I have a bullish bias but we could sell off as well.
Other names I’m watching are TSLA and AAPL