Grade: B+
Goals: Be more selective and raise winning %
Reminders/Aphorisms:
- Don't fight the trend;
- Be patient, take good set-ups
- Respect at least 2:1 R/R
Overview: Yesday was a big descending channel on the SPY. It seems like the big earnings this week have been making the SPY undecided in a direction. However we have been getting pounded by bad earnings (AMZN/AAPL most recently). We had the first red candle on the daily this week after a topping tail the day before. This makes me think we keep moving down.The SPY also had a large move down afterhours yesterday and has been slowly recovering this morning, opening at previous day close. On the SPY we are opening right between the 381-382 zone and the 374-375 zone. Potential scenarios:
1) We continue to move up a little to test the 381-382 zone and reject down to 375-374. I think this is the more likely scenario as premarket high is right around 381 as well with previous day close at 380.
2) We reject off of premarket high/previous day close and move down to the 374-375 at which time we reverse and move towards the 381-382. I think this is less likely but a possibility.
Trade Analysis:
- Trade 1 and 2 were the same play, a trend reversal short trade. We had broken the 5m trendline and retested and had a small pull-up. My first entry was too early and it spiked on me so I had to cut at my risk. However I re-entered at around where I closed my first position and took 50c and then around 80c on the runner right at VWAP because I was scared of a bounce. Ultimately it did break VWAP but instantly recovered and bounced strongly. My only change on these trades would be that I would have waited on my first entry for the rejection at the 20/9 EMAs.
- Trade 3 was a continuation long trade on the 5m chart and a continuation of a strong bounce around VWAP. We got the first leg and pulled back some on low volume so I got in. My entry was a little high so I was a little nervouse and took 20 shares off at even. After that I took my partial at 50c and the rest at over $1 around the 384 level which I thought would be resistance. The only things I would change about this trade was get a better fill and not take those 20 shares prematurely for no reason. If I had confidence in my trade it would have been a much larger trade.
- NOTES:
Lesson moving forward: Be patient and use important markers for entries.