Well defined wedge pattern on a AMZN. Stock showed relative strenght during the open and broke out of a larger downtrend. The SPY eventually started to break HOD and trend which resulted in a HOD close of AMZN as well.
My preparation wasn't detailed enough. I didn't put enough emphasis on a potential trend day, even though we had a significant fundamental catalyst: TSLA missed on delivery numbers for Q4. But I adapted quick and prepared for my first Trend PB trade. I did okay on my entry, but I puked the exit. I need to learn how to hold for a bigger move. That will be the main focus for next time, not selling unless there's a good reason2sell.
Trend Trend Day - First consolidation - TSLA - 3-1-23.pptxMaartenvanBemmel3
A specific trade that doesn't occur that often. After either a very strong or weak open, price starts to consolidate for at least 15 minutes. When price doesn't really pull in, traders will have to chase higher or lower and we get a nice continuation trade.
Did a great job of finding a stock showing relative strenght to the market. The semiconductors were the strongest class yesterday and NVDA was gapping up.
Fail to recognized the wedge pattern because I put too much significance on one specific price level. Then I decided to chase the breakout with a scalp trade. That idea wasn't bad, but the execution was very poor. I was trading a little bit on tilt and didn't use my scalping system.
After a large gap up of 6%, TSLA made a bullish opening range and pulled into VWAP. Institutional buyers were clearly present around VWAP on the level 2, and we got a quick bounce of VWAP and made a new HOD.
Gap down bounce day - Wedge - Trend PB - DFS - 20-1-23.pptxMaartenvanBemmel3
Very strong ticker, gapped down a lot when it beat earnings right of an important HTF support level. Traded the wedge pattern, but there were also trend PB's to trade.
I identified a solid trade opportunity after I got aligned with the price action again. I got stopped out and didn't re-enter. I analyzed my trade and also discussed some other trade opportunities that occured in TSLA. One of those I got in depth on reading the tape as well. Unfortunately I don't have the tape of the trade I took.
D1 Gap and Fail - Technical trades - NKE - 21-12-22.pptxMaartenvanBemmel3
After weak price action during the open, NKE failed to hold an important price level and started to trend down towards the next support area.
I playbooked this nice short opportunity.
My preparation wasn't detailed enough. I didn't put enough emphasis on a potential trend day, even though we had a significant fundamental catalyst: TSLA missed on delivery numbers for Q4. But I adapted quick and prepared for my first Trend PB trade. I did okay on my entry, but I puked the exit. I need to learn how to hold for a bigger move. That will be the main focus for next time, not selling unless there's a good reason2sell.
Trend Trend Day - First consolidation - TSLA - 3-1-23.pptxMaartenvanBemmel3
A specific trade that doesn't occur that often. After either a very strong or weak open, price starts to consolidate for at least 15 minutes. When price doesn't really pull in, traders will have to chase higher or lower and we get a nice continuation trade.
Did a great job of finding a stock showing relative strenght to the market. The semiconductors were the strongest class yesterday and NVDA was gapping up.
Fail to recognized the wedge pattern because I put too much significance on one specific price level. Then I decided to chase the breakout with a scalp trade. That idea wasn't bad, but the execution was very poor. I was trading a little bit on tilt and didn't use my scalping system.
After a large gap up of 6%, TSLA made a bullish opening range and pulled into VWAP. Institutional buyers were clearly present around VWAP on the level 2, and we got a quick bounce of VWAP and made a new HOD.
Gap down bounce day - Wedge - Trend PB - DFS - 20-1-23.pptxMaartenvanBemmel3
Very strong ticker, gapped down a lot when it beat earnings right of an important HTF support level. Traded the wedge pattern, but there were also trend PB's to trade.
I identified a solid trade opportunity after I got aligned with the price action again. I got stopped out and didn't re-enter. I analyzed my trade and also discussed some other trade opportunities that occured in TSLA. One of those I got in depth on reading the tape as well. Unfortunately I don't have the tape of the trade I took.
D1 Gap and Fail - Technical trades - NKE - 21-12-22.pptxMaartenvanBemmel3
After weak price action during the open, NKE failed to hold an important price level and started to trend down towards the next support area.
I playbooked this nice short opportunity.
Gap down Bounce trend day - Trend PB - TSLA - 6-1-23.pptxMaartenvanBemmel3
Added a new setup to my playbook: bounce trend day. Wasn't really familiar and I therefore didn't prepare for this setup. Glad I have added this setup to my playbook. This is a great setup for growth stocks that sold off a lot.
Gap down bounce day - First consolidation - HTF PB - ILMN - 10-1-23.pptxMaartenvanBemmel3
Strong bounce play on ILMN. The best opportunities were in the morning. I was watching it for a pullback but gave up on it too early. The PB that followed wasn't an A+ setup but still had some edge.
D2 continuation play on ILMN, very similar to LULU the day before. Due to a mistake I missed this setup.. Lower volume stock, but it still made a very nice move and closed strong.
First day of MRNA where it broke trough very important Higher Time Frame (HTF) levels whilst having a very strong fundamental catalyst. This playbook captures two trades: a First consolidation - Morning continuation trade and a Pullback (PB) retracement. The move during the morning was huge. In the end we trended but but didn't manage to close into/near the high of the day.
D3 continuation play. The strenght was mainly in the opening action, but it didn't provide any playbook setups for me. After a VWAP pull in a trend started, but the volume wasn't enough to reach HOD.
Gap down bounce day - Wedge and trend PB - LULU - 9-1-23.pptxMaartenvanBemmel3
Strong bounce play on LULU. They announced that they were lowering their guidance for the next quarter. This is bad news, but recent prior earnings LULU already gapped and trended down 13%. Today LULU gapped down almost 11%, and the market deemed that it was extended.
Today price
Sometimes, when stocks have a catalyst, the price action completely reverses on day 2. This happened to NKE and it provided some strong technical trades of important levels. I didn't trade them but I used a market structure drill to analyze the misses trades.
Failed gap down bounce day - trend pb - AP vwap pull in - PG - 20-1-23.pptxMaartenvanBemmel3
Traded a VWAP Pull In which is turned into an anti-playbook trade on this setup. Thereafter I was unable to switch bias go with the trend. Missed some great opportunities.
COST had a positive catalyst and broke out of a daily range. It had a very strong opening drive and quickly formed a wedge during the open. This wedge broke out and before 11AM COST was already up almost 2.5ATR move. This seemed very extended, but we got a HTF Trend PB that closed near HOD because the overall market was trending as well.
This is a playbook trade I made on MRNA. MRNA is a stock that was very strong in the last two months and had a new catalyst. They had positive data on their cancer vaccince. It is a continuation play.
It was my first time in this setup a trading this specific trade. I plenty of things right, but luckily there is also a lot of room for improvement. Cheers.
D1 earnings gap up - VWAP Pull In - MS - 17-1-23.pptxMaartenvanBemmel3
The earnings beat wasn't that strong ,but the fact that GS missed on earnings gave it relative strenght. Together with the elevated volume, this caused for a great move and RR opportunity.
Strong price action on earnings play. Since I discovered that I in general shouldn't trade between 13-14PM, this is the first time I am making this mistake. That can happen but from now on it's unacceptable. I also did some research on playbook setups that made a huge ATR move, pulled back and made a new HOD. SPOT didn't fit these criteria.
LW is a very strong stock with good earnings. After again a massive earnings beat, LW gapped up a lot. It closed strong and broke briefly above the all time high. On the 2nd day it opened above day 1 and made a strong continuation move into new all time highs.
D2 Catalyst Continuation Trend Day - MDGL - 20-12-22.pptxMaartenvanBemmel3
This is a trade on a stock, MDGL, that I had prepared but failed to trade. I analyzed in detail why I missed it and how I will prevent missing this next time.
After some strong price action following a gap up, price starts to struggle and fails down VWAP on some elevated volume. Then price pulls into the EMA's on shallow volume and got some nice follow through.
The document discusses a potential high time frame breakout trade in the stock BABA. Key points include:
- BABA is in a strong sector and has the potential for a technical breakout.
- The stock has consolidated in a tight range near key resistance at $95 in the pre-market.
- Traders should watch for a breakout from the opening range consolidation, entering on the first higher low with a stop below the opening range low.
I prepared NFLX in great detail but it was not easy to form a bias. There was an earnings miss with a positive reaction. But there were some elements in the catalyst that were positive. The technicals were also strong so a reversal wasn't obvious at all. In the end the price action fitted the catalyst and setup: indecisive and choppy. Nevertheless, there was a solid trend PB trade that occured EOD. SPY was trending all afternoon and this was an important factor.
MSFT was gapping down on earnings news. They beat the estimates but also guided a bit lower. There was a key support level that MSFT bounced of. Together with a strong market MSFT reversed and made a strong PB.
The miss on earnings caused a significant gap down of -4% and -2ATR. Directly when the market opened, NEE was extremely weak and sold off without a proper PB. Then it reclaimed VWAP on volume. This should have been the cue for a solid EOD Trend PB opportunity, but I missed it.
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Added a new setup to my playbook: bounce trend day. Wasn't really familiar and I therefore didn't prepare for this setup. Glad I have added this setup to my playbook. This is a great setup for growth stocks that sold off a lot.
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Today price
Sometimes, when stocks have a catalyst, the price action completely reverses on day 2. This happened to NKE and it provided some strong technical trades of important levels. I didn't trade them but I used a market structure drill to analyze the misses trades.
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COST had a positive catalyst and broke out of a daily range. It had a very strong opening drive and quickly formed a wedge during the open. This wedge broke out and before 11AM COST was already up almost 2.5ATR move. This seemed very extended, but we got a HTF Trend PB that closed near HOD because the overall market was trending as well.
This is a playbook trade I made on MRNA. MRNA is a stock that was very strong in the last two months and had a new catalyst. They had positive data on their cancer vaccince. It is a continuation play.
It was my first time in this setup a trading this specific trade. I plenty of things right, but luckily there is also a lot of room for improvement. Cheers.
D1 earnings gap up - VWAP Pull In - MS - 17-1-23.pptxMaartenvanBemmel3
The earnings beat wasn't that strong ,but the fact that GS missed on earnings gave it relative strenght. Together with the elevated volume, this caused for a great move and RR opportunity.
Strong price action on earnings play. Since I discovered that I in general shouldn't trade between 13-14PM, this is the first time I am making this mistake. That can happen but from now on it's unacceptable. I also did some research on playbook setups that made a huge ATR move, pulled back and made a new HOD. SPOT didn't fit these criteria.
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2. Bigger picture: QQQ/SPY and VIX
Premarket notes:
Breadth is still decent looking.
SPY and Q’s had a decent day
yesterday. Closed strong near
HOD after a midday trend.
Tomorrow the CPI numbers will
come out. Don’t expect a big
market move ahead of these
numbers.
Real trend days if we break
Monday’s high.
Everything is gapping up small.
XLE is performs best besides
ARK. TLT also stronger. SMH is
moving currently red premarket.
VIX level : >20; elevated.
Forgot to mention the importance of Yesterdays bounce of range high and
strong close. That’s significant. Also doesn’t make sense that we’ll trend ‘if SPY
breaks Monday’s high’. Given the open, the trend will start earlier. If we gap up
through this levels during the open, then we need to hold for a trend.
4. Gameplan
1) What is the catalyst? & Intraday fundamentals
showing relative strength to the market. 470% volume buzz.
Up 0.71ATR in an opening drive.
It was trending down and showing relative weakness to the market. Perhaps this is a reason why
we could show relative strength.
2) Wat are potential setups. What are the playbook indications & statistics I have for these
setups? Compare.
A bounce continuation play. As I would like to see in TSLA. It is already up 14% from the lows. We
sold off 20%. No extreme selling, but prior to that we had a larger and weaker sell off: 30%.
Also had a 20-25% bounce in May, but also the selling that preceded was huge.
There are plenty of 20% bounces. And those had often consecutive green days. But those weren’t
large green days that did significantly more than 1 ATR.
Wedge checklist
-0.7ATR move
- Elevated volume. 1.7 RVOL
Volume buzz 280%
-Shallow volume yes
-Visible on 3m, not super obvious.
-Room on daily to trend, broke out of potential bottom range.
- Intraday up to 1 ATR target.
-Just broke the lows on some increased volume. Quickly reclaimed.
5. Catalyst &
Fundamentals
Catalyst: Relative strength to the market.
Setup: Bounce continuation setup.
Float: 9,2B
Institutional Ownership: 60,1%
Short %: 0,81%
ATR: 2,89.
Average Daily volume (50 day): 67,6 million.
Daily volume: 102 million.
Gap%/Gap ATR: 1,25% / 0,6ATR
RVOL: 1,7 during the open.
6. Key levels Support:
90 level: premarket high and prior high of
daily consolidation. 8/10.
If we don’t hold above this level the setup
is invalid.
Resistance:
93 level: former intraday support. 7/10
96: last obvious lower high of prior
downtrend.
7. Trend day–
Trade Strategy
Stock selection – Market play
-Elevated VIX : >20.
- SPY gapping up and has potential to trend/close green.
AMZN showing relative strength to the market:
-Strong open.
-Elevated volume
-Beta of 1,17, high correlation with the market.
Bounce continuation cue’s/variables
-Broke significant out of downtrend channel.
-Gaps up.
- Potential bottom on daily is in.
-Reclaim of important levels: bottom range high 87.
-Extreme selling on the daily, stock bounced on CPI data in November but still trended lower. Not a
solid bounce
Trade2hold factors after 12:15
- Holding above significant support level: 90 confirms price breaks out of downtrend channel and is
bouncing. Prior to that price broke important 87 level.
-Strong market. SPY had potential to continue the breakout of the consolidation range of past weeks.
Open action was indecisive but started to trend just before noon.
-Market starts to trend intraday.
-Technical catalyst: Bounce continuation and break out of downtrend channel.
- Elevated RVOL, not extreme but was elevated.
- Solid trade pattern: Wedge pattern and Trend PB.
- Room to trend on the daily: Yes, just broke out of down trend channel. Up 11% from the bottom at
the open.
- Strong open, but extended: 1,75ATR. Immediately trends higher to 2ATR :
-Room to trend intraday: Once price reclaimed HOD, AMZN was only up 1.17ATR.
8. Wedge Pattern Trade2hold – Trade Management
Move2move - Flat
Significant 1m close below 20
EMA:
1) close on above average selling
volume;
2) a new 5m low that occurs after
close;
If price action is weak, THEN
adjust stop:
-Significant close below 9EMA.
Move2move – Exit strategy
ATR moves: 0,9 -1 ATR
-Profit taking into
psychological numbers and
overextensions.
-Comes into price
target/indicator and begins
to reject this price.
-Heavy sellers on the tape
into key level.
-Consolidation break to the
upside.
-Fails to hold above key level.
-Sharp unstainable moves
higher
Wedge pattern breakout- Entry
Entry: after stock has broken out
of wedge on volume, then enter
when large offers got taken out.
Stop: 1m low candle or below
breakout level.
9. Technical
Analysis:
Wedge pattern
Break through HOD/resistance.
Wedge visible on multiple
time frames.
Low volume in consolidation.
Elevated volume when price
breaks out of wedge.
Pattern with higher lows and
lower highs. Tight pattern!
Holds above premarket/
opening range high.
10. What was the optimal trade management strategy, in order to minimize risk
when wrong or maximize gain when right?
How did my strategy deviate from the optimal strategy?
AMZN showed relative strength during the open and had some room on the daily.
We also had some elevated volume, but nothing too special.
Due to analyzing prior bounces in AMZN, I wasn’t convinced of an ATR move
significantly greater than 1ATR.
We had no catalyst, exceptional volume and SPY was trading within a small
opening range; it wasn’t trading.
I chose for a move2move strategy, which was the right choice.
And this move might have turned into a trade2hold/trend move. But that’s okay;
that can happen. That’s an opportunity for me to get back and find new entry. But
I shouldn’t get frustrated. As soon as move/trade is over, it should be done. Don’t
dwell if it goes higher: focus on the next trade!
11. Trade management
Ideal entry vs my entry:
After the wick down that broke the low of the wedge on elevated
volume, price reclaimed quickly and did extremely low volume,
lowest of the day. This was the best entry for the first tier.
I chose to get in on the breakout. In hindsight my entry wasn’t
even that bad.
Lower high of the wedge was .80.
Tape increased and more green prints. But we didn’t have above
average volume on the 1m yet.
Offers at .75 broke and we and strong .80 offers got lifted. This
was the best entry. Would have gotten filled at .86 on the offer.
-I got in the next big offers broke at .90, filled at .91.
Stop:
I put my stop at .69 risking .21 cents. Low of the breakout candle
was .45 which is way too much for a breakout. I gave it some
room to trend along the 9EMA. But not too much.
Exit:
I think a 0.9ATR target was a great measured reason2sell. Well
defined move with plenty of edge, given that we had a successful
breakout.
I moved up my stop because we had plenty of heavy selling after
the breakout. The bids held their own as well, but I didn’t like the
price action. Therefore, I decided to sell because I was up 2R.
13. SPY shows sign of trend at 12:30
-Hold above
opening range
high with a
bounce/consolid
ation on low
volume.
-Shallow volume
all day on AMZN.
14. What could I have done
better?
• I need to be more aware of the trade I am taking in advance. I had
proper risk management and targets that made sense in hindsight.
But if volume had increase and price would have traded to 94-95
without breaking the 1m 20 EMA, this would have been a very
poor execution:
• Focus more on m2m reason2sell than measured move.
It’s good that I trailed my stop along the 9EMA once tape started to
get happy. That way I am protecting my capital. But just selling a
full position after we break heavy offers is hurting it. I need to
focus on the m2m reason2sell. My goal is to capture as much from
the move as possible. I captured 54% of the move which barely
above the minimum.