Hello everyone , hope you all had an amazing day , this blog is getting put up. little later than i would've liked so ill do a quick summary recap in terms of the Tuesday bounce and today's rally. So let's get started !
INDICES + Remaining Neutral
Although the stock market was closed on Monday, futures were open on sunday and they were open shortened hours on Monday. We closed end of day Friday just around that 3750 /ES support , give or take 373.84 on $SPY (hit Friday after hours, and the low of day) . As stated on Friday's market recap blog post, there was a high probability of buyers stepping in and bouncing us all the way back towards friday's highs, which indeed came true, as /ES found its way all the way back to 3796 and spy got back into that key 379.1 level we discussed. From there there were two possibilities , we remain short under 379 , or buyers consolidate under the level and find the momentum to burst through. Although I was looking for us to originally reject, once we started to hold and flag under the 379, I had to revert my thesis back to the bull side. Sellers originally were stepping in off 379, giving us an /ES drop from (3796 to 3770 on Tuesday, about a $2.50 SPY drop) but after that morning drop , buyers were starting to hold higher and not giving back 378. That base and failure to break back down , indicated bull strength, and we began looking fo take long positions again . In hindsight the $SPY drop into that 374 support, ended up just being a gap fill from 1/6 and we continued on our merry way back towards the highs.
You may ask "You were short, why didn't you stay short?" And to that i respond, yes i was short on the market with some bearish sentiment when $SPY rejected 381 and broke back under 379 on Thursday 1/14 , after being short from 381 , we got a sell back into the key level off 374-373.88 and we took some profit, we caught an almost $7 drop , yes we were looking for another potential move down , but at the same time we always let the price action tell us what to do , and not make preconceived judgment. The thesis was short the market on $SPY under 379 and we could remain short on any bounces into that level , the initial short gave a nice $7 down move (orange highlighted candles) , where as the retrace rejection on tuesday gave about a $2 short move (blue highlighted candles) , ya both trades weren't the same , but that's very rare to start with, each trade is a new opportunity and you need to manage each one wisely. After the morning rejection on Tuesday 1/19 we started to hold, and once price action started to hold higher failing to go lower, it was starting to indicate the heavy presence of buyers, and since we have a flexible unbiased mindset, we are able to accept that "the market is looking like it wants to head higher, let's get our shorts, and wait for the next best trade (which we always have plenty of)".
SPY HOURLY - Highlighted 1/14-1/15 and 1/19
/ES 4hr - 1/11-1/20
Apart from $SPY , tech, $QQQ had a very strong up move this week engulfing the Friday break down candle (SHOWN VIA /NQ BELOW) and making new highs as well, looks like earning season is about to get very fun.
Other than that markets continue to be extreme bullish, and so called "market crash" didn't happen , and we continue to play the market movements without being biased. Hopefully that little section regarding 'being unbiased' will help some of you out - ( can do a whole page on that as well just comment down below ). Again always have a plan , stick to the plan for taking profits and taking entries , and then don't ever hesitate to cut out of trade because it's not working. Again trading isn't about being wrong or right, but it's about being taking high probability trades. Sometimes your best setups will fail, and that's ok , stick with it , because the next one could be that big winner. Don't go in with preconceived conceptions, just go in with your appropriate risk and manage the trade as it goes your way.
Since we went a little more deep into the indices talk, i'll have a brief trade review for the last two days highlighting 3 of the better plays and setups we took.
On Monday (1/19) - we had our $SPY shorts off 379 , DASH over under 192 and PLUG over 66.54.
On Tuesday (1/20) - we had a lot more fun with me and moe going through AMZN, FB, GOOG, TSLA, AAPL, NFLX just to name a few :
We will go over FB and GOOG from Tuesday and then PLUG from Monday:
PLUG - This was a nice intraday breakout that had the potential to turn into a swing trade, but just wasn't able to maintain its momentum to end the day. We had a key level off 66.54 , and midday we began to flag and start to hold higher looking for a break (highlighted circle) . We took some longs off the break with our targets at 68.5 (blue line) and 69.5 . On the break we got a $2+ move , took some profit just a few cents under our first target , and then sold the rest right before close as we failed to hold over the level.
PLUG - 5 MIN - 1/19
GOOG- This was my favorite plays, on one of my favorite setups , ALL TIME HIGH BREAKOUT !!! Off open today Google has 2 entry options, either we open off 1807 or we open over 1828 and go long , and to my surprise we opened over 1828 and this gave us a money printing machine !!!! Google almost ran its way just over 1900 just barley falling short and giving us a $75 + ripper !!! The picture down below shows the opening tick on google, which indeed was over 1828 , and this gave us early morning players a nice morning play. Then later , about 30 minutes later after hitting 1858 ( a new high) GOOG retraced a bit give us another potential entry (2nd highlighted circle, with stop still at 1828 and new highs in sight)
GOOG - 1 Min - 1/20
If you used a higher time frame on google , after we got that initial 30 minute close , we just kept going , and no 30 minute candle closed back under the prior 30 minute breakup candle, allowing you the freedom to let the runner run !
GOOG - 30 Minute - 1/20
FB- Facebook was another nice one that opened above the key 263.5 area(gotten from 1/6 daily close) (and it based off the level all night after hours) and gave us a few dip buying opportunities at open.
FB - 5 Min - 1/20
As seen in the image above , 10 minutes into open we had a quick dip into 263, we bought that level , and 10 minutes after entry we were back at 267, giving us a 4$ bounce (+ we were back at vwap , so we sold some here for 25% profit) and then when we dipped back into 263.5-264 we bought again or added size still looking for 269 (open price) or that mid 270 price target. This one was a great example of a play that gave multiple chances to enter, or gave about an hour before it had a more defined up move. Regardless of which play was taken , the rules and process was the same, get a good entry close to risk (or close to 263.5-264) and then take some profits on move back up and base looking for high 269- 270 targets.
Hope you all had a great day , and hope this post gives some insights on key levels + some tips. Again if you guys want any blogs in specific please don't hesitate to drop them below !!!
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