Market Recap 7/19
Hello everyone , and welcome back to the daily market Recap by True Trade. It's been a while doing one of these, but looks like we are back with popular demand.
The format for these will remain pretty simple , the first paragraph will go over my views on the indices followed by our plays of the day (posted and taken daily in our True Trade discord service - (check stock signals membership for more info), and on special occasions , a tip or setup of the day.
So let's get started !
(ALL TIME IS BASED ON PST)
(for all trades below I mention level hold, stop loss, etc, I'm using daily or hourly closes for stop losses or holds, you can trade the levels on an intraday basis !)
Not much to say about the indices, other than we did get the expected downside move to start the week 👀
Overnight , we got the crucial hold under 4309 which did send us lower for most of the day , until that eod rally , which we will go over in a bit.
/ES - HOURLY UNTIL 5:30 PM, 7/19
The red circle highlights the hold under the key daily level , while the red zone is the support from our last flush down at 7/8. We made a significant down push on the market , but seemed to level off just over 4220 , as buyers stepped in and began pushing us to the upside . For the current time we have started to rehold that 4262 level , which is another crucial zone , and if we can continue to hold into open tomorrow , would eye a move back into that last low around 4285 , if not a retest of 4310 (I will have some spy levels posted in the next section to make it easier for you stock traders.)
The DOW and NASDAQ both looked similar to spy , as bot also had some decent 2% + pullbacks before ralling to end the day , would look for continuation to the upside to test the breakdown locations and see if this selloff was just a pullback , or the start of something greater brewing. The next few days will definitely help identify what the market outlook will be for the weeks to come.
On the flip side VIX got its first close over 22 in a month long span , keep an eye out for this as it could be a sign for sellers to be brewing on bounces into tomorrow or Wednesday. But for now , we wait for these next few days to settle out , play the trends on the day , and then look for the potential of the next "big move" to form. As always , play with the trend, have a tradable thesis, and be flexible with that tradable thesis if it begins to fail , knowing where you are wrong , and when you need to accept your loss and move onto the next trade !
As we were gapping down pretty significantly this morning , i was interested in some morning bounce plays , with some of the favorites posted below :
I personally did not get my fills on NVDA or NFLX , mainly due to the ridiculous morning premiums with there spreads. Netflix has earnings this week , so along with that + increased market IV , those contracts were horrendous ! But we did have a few traders take some share trades on it , and for that reason we will do a mini breakdown.
Most of my focus this morning was on some of those watchlist plays ( https://www.truetradellc.com/post/market-watchlist-7-19-7-23 ) , including SNAP , IBM and SPY.
First we will over the miss of the day , which was the SPY trade , well we had 1 hit and 1 miss on this one , so let's begin.
(Generally i would breakdown where the daily levels were gotten from and why we had them , but with these , the levels were posted and broken down in the watchlist above.)
5 MIN CHART - 7/19
PURPLE: The initial morning thesis was looking for buyers to step in around that 425.26 , as we had a major gap down an were at a key location, so off the open we look to be buyers into this level , realizing "yes the market has seen some overnight selling , so if they do continue we will have to stop out quickly, but in most cases , in a bull market buyers will buy the dip". In this case , our HOD made in the first five minutes occurred at 426.71 , off which we rejected into that 425.26. We start our small buy position , get a $1.5 + up move but reject under HOD , and
GREEN: The 2nd buy attempt , not ight at the level , but closer to 423 , once we saw buyers hold off the area , stop under LOD targeting vwap break and 425.69 target. Took some time to play out and we did get back into the 425 target area , but option contacts had not moved as much as expected so it didn't turn out to be much.
RED: Once we got back to the 425 location , the key daily level , notice how we tried to break over a few times and we were unsuccessful. Knowing the trend of day was down , the sell momentum was heavy , and 245.2 was a pivotal location , this offered a short trade , where we could stop a few cents over 425.3 , targeting a move back into LOD. The trade here worked out , as were rejected , got back under vwap, based under vwap and then pushed into LOD for a nice $3 + trade.
BLUE: I was not trading into EOD today , but a trade on the table was available. After we pushed into LOD , we couldn't seem to get much lower than 422, buyers continued to hold for a good 3 hours, and off that we saw a nice $3 rally back towards.... you guessed it the key 425.26 level , and closed the day just under.
As seen above , when volatility is increased, there is a plethora of trading opportunities available on any given stock name. With increased movement you want to make sure you have the right key areas, and be patient take take good trades at these key areas, without trying to jump in , in between and getting chopped. Don't chase if you miss a trade as there will always be more 😉
5 MIN CHART - 7/19
Next up we have SNAP , which gave a pretty simple trading setup. We opened above the 57.14 daily buy level , and saw a quick up move off open. After that we pulled back into 7/16's lows and started to consolidate and hold vwap. Utilizing the key level and hold , we took a long SNAP trade off the consolidation hold over 58.2 , targeting the gap at 59.3 and key level at 60. First we got a nice move into the gap (top grey zone) , took partial profits , and then started to see a higher hold at the gap , looking for a continued upside breakout. After that we broke , hit 60 target took some more profit , and moved along with our day 🚀. Put in trailing stops , and then started to scan for the next trade 😱.
ONE MIN CHART - 7/19
Lastly we have a nice IBM morning scalp play + a midday buy and hold play. We aw buyers step in quickly on the gap down , and we took a long 2 minutes in on strong buyers pushing us over 137 (key level gone over in watchlist) , shortly after getting inwe saw a $1.5 + move , locked in some profits and then got stopped out back at breakeven . Simple quick scalp , with a rejection back into support , where we were stopped , but then later eyed a re-entry on a continued hold.
15 MIN CHART - 7/19
After the morning rejection IBM pulled back , and held opening price + hovered over that 137 level. Knowing that earnings were coming after hours, and that we were holding a key support , we took a midday long trade off 137 , looking for an EOD run up pre earnings. Didn't start too much until around 11;30 where t got tighter at vwap before eventually bursting into the close giving us a nice $1+ trade . I personally took all mine off into close , butt it was trader's choice if they wanted to swing into ER , and oh boy did this hit on ER , running up to 143 👀. I will definitely have this on watch again tomorrow. 144.5 as some resistance whereas 141.5 and 143 can be buy areas based on where we open.
Now that we have the bread and butter trades out the way here's a mini NFLX breakdown:
5 MIN CHART - 7/19
Off open we saw a quick NFLX flush under 525 , wth an immediate recapture. There is a red to green trade available here , but I would like to wait for some confirmation over 525 to take a little longer hold trade. After the reversal we spiked into the gap at 530 where we initially reject, and pull back into 525. Off that rejection is where interested , looking for a hold on a pullback.
As seen above we pullback into 525 , hold vwap , and this is where I would be most interested in the long trade , placing my stop about 50 cents under 525 , targeting the gap at 530 . We get a move back up , take some profit at first target , and continue grinding to a HOD at just over 534.
After the 534 rejection a trail stop can be in place , as we never want winning trades to go red . And as seen above , not much occured after that rejection as price fizzled out into vwap , before another eod spike.
Overall it was a nice trading day , as most days with increvolatilitytlity are. Missed a few good ones on the list like entries with NVDA , NFLX and PTON , but even then we had some nice base hits on SPY , IBM and SNAP.
Get your mind refreshed and ready for tomorrow , let's hope this volatility stays alive for week to come , and even if t doesn't, keep an eye on earnings movers for some solid trade opportunities !
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Hope you all have a wonderful rest of your weekend, and a great upcoming week :)
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