SPY with another tight range today to 300 w/ 302-303 next resistance. So I've been getting some trading exposure in the Biotech's and quickly noticed the volatility. BIIB had earnings + news that a drug has met a phase 3 endpoint. There was solid volume in the pre-market and originally I had a long plan but a short plan was also in place. I will go over this learning experience in the the review section below. This trade was a scalp in addition to a core starter I had closer to VWAP which is reviewed in a separate trade.
RVOL - 4.95
Avg Vol - 1.54M
ATR - 5.30
Short Float - 1.94%
Institutional Ownership - 91.80%
This short started to gain more traction approaching a key level. This was aimed as a scalp. I was looking for a reason2exit as this was what I was working on. Seeing the quick gains got to me again but I was looking for the reason to exit. My reason for entry was the tape showing the break and selling pressure at 300. I zoomed out to the 5 minute time frame and I saw a peak volume bar being put it. This is also where I updated my stop cover on my Tier 1 trade. I think I did pretty good here as the goal was a scalp. I guess I could have treated this as an add to the position but the scalp would be good. Next time I will consider making this a tier 2 and add on to the trade 2 hold. The price ran up significantly in the pre-market and the shorter-term trend has not changed back to the buyers yet.
Key learning experience : I remember Dr. Steenbarger talking about being able to flip trading plan positions at the moment the market tells you. This is a case where I had a long and short plan. The long was presenting itself in the pre-market but at the open it quickly changed. The ability to recognize that and execute accordingly was the ah ha moment in a trading career he described. That is somewhat of the experience I learned here and take away.
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