SPY filled the gap and reclaimed 632. Will it get faded or return to 635+ this week. Trade Ideas for Tues Aug 05
I avoid overtrading by focus on key levels and key windows of time. What is your process to give you the best results?
Good morning!
I was definitely not expecting a full bounce reversal to develop yesterday so I didn’t get long until the late afternoon presented a good risk/reward setup.
I was pretty sure about where we would not clear and so took SPX 6330/35 bear calls for 1.20 which ended the day at 0.
Alerted SPX 6325 calls for $1 which hit $7 and sold for $5 for 400% gains. good enough for me.
Let’s review the aciton.
SPY/SPX
Morning Setup: 4 Level Gap UP and GO
I don’t have the metrics on this. So I don’t take the trade. but we had a 4 level gap up and then a premarket high break out. mind you this is a potential recovery after the 2 day drop last week.
However this isn’t my setup so no trade for me. THIS IS ESSENTIAL. WHAT ARE YOUR KEY TRADE SETUPS? WAIT FOR THOSE AND ONLY TAKE THOSE TRADES
After I saw the consolidation, I expected at least a dip to test the open to come and so I decided on using SPY 632 as my “worst case” scenario. This led me to take SPX 6330/35 bear calls for 1.20 and selling most between 0.50 and 0.20. Free money trade without any stress.
And so I waited for a short trade setup that never developed. I then told members I’ll be back at 2pm
The play I was looking for came in late afternoon….
Afternoon Setups: Basing leading to Short Squeeze
We had a a dip at 1:45 to test the 10:30 level and it was quickly bought. 630 was basically basing. so we look at the level above which was 632.
I was targeting SPX 6330+ coming if the squeezing came so locked in most of my bear calls at 0.20 and runners with stops at 0.60. (should have exited all in hindsight. why risk 0.40 for an additional 0.20)
So given I was expecting $5 I planned to scoop SPX 6325c for 0.50 and 1. 0.50 orders never filled but the $1 order filled. These reached $7 into the close!
That was basically it. Most of the day was DOING NOTHING. Waiting for one of my trade setups to develop. I wanted a short, it didn’t setup. so no overtrading.
I took one short that gave small gains and then quickly got stopped on runners. That is ok. It wasnt a high probabilty win based on the action, but it was an early entry so low risk, and if dieveloped could have paid 20x.
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 Tue Aug 05
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
Ok so mostly focused on SPY again today .