Will TSM's earnings trigger a reversal today? Will there be more selling? Trade ideas for Thursday July 18, 2024.
Good morning traders!
Patience and planning pays! Sometimes the best trades you can take are the ones where you say I don’t like the risk/reward and do nothing. Even if you miss out on a great trade, how many “bad” and losing trades would you avoid by having the freedom to just say no to a trade.
That’s how it felt yesterday. I got positioned short in the morning, and then planned a yolo for a support break in SPY that didn’t develop. Outside that, there was a whole lot of avoiding getting chopped! I was so looking forward to a 10 bagger setup to develop but we didn’t get it and I lost on the yolos I did take. The yolos were sized that I was risking less than morning gains. So it was a make small profit or make monster profit type plan by the end of the day.
Let’s go over the trades I took and didn’t take, and the logic behind it as well a some ideas for today.
Introduction (for New Readers)
Welcome to my blog on Two Hour Trading—your daily source for market insights and trading opportunities. Here, you’ll find comprehensive market analysis, educational lessons, and trade ideas to help you excel in trading, all while spending less than two hours a day.
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Subscribers receive daily market analysis updates, educational content, and up to three trade ideas each morning based on real-life examples and my trading approach.
NOTE: screenshots from chat are from Edge Trade Planner. A platform available to THT PRO members. Join Us for live commentary and planning. Note my goal is to actively trade less than 2 hours a day finding 1 to 4 great trades a day.
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
2024 Alert Leaderboard
Here's a look at some of the potential gains achieved through our entry alerts:
July 16 - SPX 5660c $2. reached $10! ($2000 —> $10000 potential)
July 16 - SPX 5660c $2. reached $10! ($2000 —> $10000 potential)
July 15 - SPX 5650c $1. reached $4! ($1000 —> $4000 potential)
July 11 - SPX 5600p $2. reached $23! ($2000 —> $23000 potential)
July 09 - Credit Sell SPX 5590/5595 bear calls 2.30-2.50 stops at 2.60 ( $2500 premium collected per 5k position risking $300)
July 08 - AVGO 1800c 13( $1300—> $2250 potential)
July 08 - SPX 5560p 2.50 stops 2.30 ( $2500—> $5000 potential)
July 08 - TSLA 270c 4.50 target 7.50 ( $4500—> $7600 potential)
July 03 - SPX 5520 2.5 ($2500—> $18000 potential)
July 02 - TSLA 225c 3.5 ($3500—> $8500 potential)
July 02 - SPX 5500c 2.50 ($2500 —> $10000 potential)
July 02 - SPX 5470 Bull Puts 2.50 ($2500 credit collected)
July 01 - closed TSLA Swing $2.65—> $12.00
**Past Performance is not indicative of future results
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Wednesday’s Recap
Let’s review Wednesday’s trades. Did you take advantage? If not read on an learn how.
SPY/SPX
Please review the chart above.
As you can see, we didn’t quite get to the level above I wanted to get short, and so I waited for after lunch and contracts to get cheaper.
After seeing the price action, the plan was to get short off 5600-5610 pops in afternoon looking for a support break. Unfortunately that didn’t develop, but if it did, the return the yolos would have been 20-50x!
The key lessons to learn here are that even with planning and positioning, you can’t force the market to move the way you want. What you can do is manage your risk. Overall I’m very happy with the trades I did take. I had profit off the entries, but they didn’t get to my sell targets and went red. THAT IS OK. That is part of being systematic. There will be losers, but that does not mean it was a bad trade.
if 5630 turns into support today, I’ll consider long, but if 5580 breaks, and gets toppy, I’ll be loading up short of 5340 or less.
AMD
This was an early catch. I typically like to wait first hour, but with the support breaks I saw, I thought 165p is a no brainer.
Not a bad move on these from 2.50—>6.50 for a 100%+ gainer! It was an interesting trend that let one sell into spikes, and reload $1 lower than recent highs multiple times.
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/failed breakdown reversal
Join at vwap mid day or end of day
Keep it simple. Don’t chase, wait for support levels for great risk/reward entries!
Trade Ideas - Plan for Thursday July 18
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
So frustrating. I wanted to get short today on a gap up reversal. Not I’m looking for some gap fill and rally into 11am and then go short. ASML earnings could trigger more selling chip names, so I want to get positioned for profit taking.