MRK Trade on Jul 30, 2019 09:56 from MarcoG: Tradervue User Stock Trades.

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MarcoG

 

Consolidation Squeeze Play! 52 Weeks High Spike on ER beats!!

Requirements:

RVOL: Possibly >1.5
pmVOL: Possibly >50 K
avg Vol: > 1M
Vol @ Day : > 1 M
Gap: If possible but not strictly needed
Long Term Chart : Possible Pocket, trend already defined and strength.
Float: > 20 M
Short Float: Possibly >40%
Institutional Ownership : Possibly > 100%
History of Gap Follower: Neutral
History of former runner: Possibly YES
Major ETF movement and strength: Possibly Trending with strength


Trade Scenario

MRK had earnings release today and gaped up in PM. The earnings results are quite positive, I was expecting it to get to test the 52 weeks high level at 87.07
Usually in this kind of scenario with positive er, gap up above 4%, RVOL at 1.5 and pm Vol above the 100k after the VWAP retest and holding such level the stock tend to get to 52Weeks target!

Trade Variables

Symbol : MRK
Gap : 4.4
RVOL : 1.51
pmVOL : >100k
avg Vol: 10M
Float: 2.57B
Short Float: 0.72%
pmPATTERN : Bull Flag and Bullish Pennant
Catalyst : Earnings Release

Technical Levels

Support: 84.16 / 83
Resistance: 85 / 87.09
Inflection: 84sh

Trade Plan

Set-up : Up-Trend Continuation
Side : Long
Size : 40
Entry : 84.99
Takes :
Exit : 84.62

Comments

I don't know if the mistake has been anticipating the pm high or just that today stocks didn't really move. I have back tested now since 3 months entries below pm highs or above pm lows and obviously they don't always work. Volume profile was there supporting the move and a nice accumulation on the tape gave me confidence to enter the trade. At the same time while I was in MRK, I saw PG setting up for a break indeed once MRK dropped against me I have immediately spot the entry on PG. I din't enter cause it was really few seconds after have closed MRK thus I have start to consider I was trading with FOMO, but the truth is that the setup on PG was just there! Good lesson for me today.
I am trying to adapt my edge lately, I am giving up with the idea of making money raising my size while I would like to raise my knowledge and being able to spot or at least to see other setups! If I don't do this now I will never do it again, trying when in the first year of trading is I guess a good approach cause will let me realize by the end of the year what I do best and what worst. Thus I didn't consider the fact of finishing the month green or what so ever, I wouldn't have traded MRK today for the sake of my profits, but I really don't care cause they are little money while I care to be able to interpret price action and tape reading!

I am still doing a mistake somewhere! I don't really feel lacking the knowledge to be profitable. I have learned and practice on 5 different setups since December till today and I have been rewarded for my patience and discipline applying those finishing the first half of the year with nice numbers. But now that I have got there something is happening. I am adding on my trading practice or at least I am trying to add new strategies and approaches that would make my trading activity quite more interesting. But obviously to get to master those new setups I might need the same time I needed for my actual strategies to get to work. This can lead in being still waiting to make some income needed to live. I am analyzing the reason why I am now implementing my trading activity giving up the opportunity to make some good profits. This is really my thing now. Shall I size up on what I have already learned to harvest all the hard work or shall I just wait and keeping adding on my trading edge?

There could be also another reason for all this:
I am scared to raise my size even if the stats are on my favor thus I find any way to avoid it! Best way to avoid it is to say yourself that you are still not ready so you need to study!


Execution detail:

Date/time Symbol Side Price Position
2019-07-30 09:56:57 MRK buy $84.990 long
2019-07-30 09:56:57 MRK buy $84.990 long
2019-07-30 09:59:38 MRK sell $84.620 0


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