SPOT Trade on Oct 28, 2019 09:43 from MarcoG: Tradervue User Stock Trades.

Pull-back play above pm high on ER Beats, Short Float >40%

Requirements:

Gap : >2.5%
RVOL : >1.5
pmVOL : >50 K
avg Vol: >500 K
Vol @ Day : >500 K
Float: >20 M
Short Float: Possibly >40%
Catalyst : Solid Fresh news / ER beats

Overall Picture

SPY performed quiet well in yesterday's trading session nicely held point of control @ 299.50sh to break 301 first level of resistance. Consolidated on that (actually I wanted to trade it :P My setup applied on the SPY :D) and found support price easily got to 302 area to close the trading session on 301.50sh. PM trading in a up drifting formation gives strength for a further continuation in today's trading session.

Today's Watchlist

Today I had on the watchlist: T, SPOT has main names and having an eye on AMD, TSLA, MSFT, TIF, OSTK.

T: AT&T Inc on Monday unveiled a three-year strategic plan that included selling up to $10 billion worth of businesses next year, paying off all its debt from the purchase of Time Warner and adding two new board members, bowing to pressure from activist investor Elliott Management. The second-largest U.S. wireless phone carrier by subscribers has struggled with a stagnant stock price despite having spent billions on a bet that owning media content, as well as all the ways that people can access it through their phones, TVs and the internet, would pay off. AT&T’s heavy debt load and declining revenue from segments like satellite TV provider DirecTV caught the attention of Elliott, one of the industry’s most powerful activist investors, which bought a $3.2 billion stake earlier this year.
I was quite neutral on T. For as much as it gaped up in pm with the announcement I was not long term LONG on T this morning when I have added it in my watchlist. I have interpreted for what I have read about the company not a real present strength.
Trading another name later in the session I have lost my interest on T.

Play

SPOT

Company Description

Sector: Technology
Industry: Internet Content & Information

Spotify Technology S.A., together with its subsidiaries, provides music streaming services worldwide. It operates through two segments, Premium and Ad-Supported. The Premium segment offers commercial-free music services to subscribers comprising unlimited online and offline high-quality streaming access to its catalog. The Ad-Supported segment provides ad-supported users with limited on-demand online access to its catalog. As of December 31, 2018, the company's platform included 207 million monthly active users and 96 million premium subscribers in approximately 78 countries and territories. Spotify Technology S.A. was founded in 2006 and is based in Luxembourg City, Luxembourg.

Trade Scenario

Spotify (SPOT) came out with quarterly earnings of $0.41 per share, beating the Zacks Consensus Estimate of a loss of $0.40 per share. This compares to earnings of $0.27 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of 202.50%. A quarter ago, it was expected that this music-streaming service operator would post a loss of $0.51 per share when it actually produced a loss of $0.47, delivering a surprise of 7.84%.
Over the last four quarters, the company has surpassed consensus EPS estimates three times.
SPOT gaping 10% after ER release is set to provide a good continuation. Good ER release is always something you want to rely on.

Trade Variables

Symbol : SPOT
Gap : Up to 10%
RVOL : 7.5
pmVOL : >125 K
avg Vol: 2.6 M
Vol @ Day : 5 M
Float: 92.80 M
Short Float: 5%
Institutional Ownership : 52%
avg ATR : 4.27
ATR @ Day : 4.91
pmPATTERN : Up Gap 6.40%(128.48) and consolidation on 128 support. Further spike and rejection but consolidation above previous level of resistance 128.48 finding support @ 129.50sh area. The stock marked a new high just last minutes prior the open touching and rejecting 2 times the 132.50sh area to open the session @ 131.11
Catalyst : ER Beats

Technical Levels

Support: S1 129.50 S2 128.48/128 S3 126.68
Resistance: R1 132.50 R2 134.73 R3 137(100/200SDMA)
Inflection: 132

Trade Plan

SPOT had a nice PM pattern and supporting ER. In addition there is a short float above 50% if I am not wrong thus an additional variable to make it an A+ trade. I was on it for a retest of inflection point or pm high.

Set-up : Up-Trend Continuation on consolidation above inflection/pm high. Entering at the pullback
Side : Long
Size : 40 + 40
Entry : 132.96

Takes :
Exit :

Trade Analysis:

SPOT broke R1 at the open to reject the 135 level. I wanted to find an entry at pullback to R1 with the aim of holding for a while prior entry to verify any eventual retest at VWAP. This would have formed a typical candle sticks formation (orders flow) that repeats very often when in presence of certain strength close to VWAP level. Price action formes a sort of tooth testing and bouncing off VWAP keeping then support at previous level.
See NVDA here just few weeks ago: Here I have entered at the shoulders of the head (tooth).

In my trade today price consolidated for the second time after the 135 consolidation and rejection @ 133.30sh. Price dropped to 132.90sh in this moment I have got a good price to enter the trade.

Intuit:

I have seen a good opportunity forming so I have focused just on that stock. This gave me more awareness and self confidence on the fact that my ideas were the result of mindfulness and not pure excitement/fear. I know I have held @ 133.30 not entering but I was aware of that and avoiding entering at the first sell @ 132.90sh I wanted still to spot a good entry point close to this level. My patience payed me off this time.

Tape reading:

I have kept my eyes on the tape to get some hints but I was really not able to see any particular indication. All was quite flat. I have traded the chart and the technicals.

Internalization:

I missed when at final stage of the trade overview (when the all thing goes into a click) to spot any eventual lack in my trade. I missed opening up to the fact of being in a favorable position.
Stick and tight to my conviction not offering any level of improvement. Though will grant me in the future collecting pointless losses. I have processed this message today I have applied it as I am used to do. A missed trade is not a missed war if this will reinforce the focus in certain areas. This will only make me stronger for next one coming. When again at a breakeven level I will analyze than with the awareness of today and take my choice. Sometimes you collect -1R, other times -0.5R and others -0.1R, as well with the profits perhaps it's just a matter of also accepting it!

Orders:

I like my orders cause they respond to my last report I have wrote yesterday on the INTC trade comments. I have followed my plan in holding and set the order when I have decided to do it. I like the fact that my entry was just prior the bounce!

Comments:

By entering the trade on that level, considering the previous consolidation at 133.30sh, I didn't want to stay in in case it would have retest my entry back again. My entry at that time and at that moment was just because price already retested the possible retesting area for me to be in the trade thus I have considered pointless to let the position go against me in case of a fade below my entry. What occurred is that price besides my entry just retested previous low to bounce off of it once again.
One big thing is on the fact that I have last week let my trades run regardless any considerations after the trade was open. This was done for a specific reason and I have collected important and fundamental information out of it. I have now started to internalize a bigger size and this is important to me. As well I have understood that for me to keep being profitable I have to keep interpreting and adapting to the trade based on the info I will be able to collect. 132.62 was traded as low at 09:41. At 09:47 price traded 132.65 as low to never look back up to 10:49. I had to keep that under consideration! I had again a narrow view on my trade even if I have entered already at what I have seen as low. Because indeed what I have seen as low might not be the traded low, a wider view would have helped again. As I wrote before instead of b/e it would result in -0.3R, -0.5R but it worth the try on those kind of setups like the one today. All the variables were pushing in, this is something you wanna keep under consideration!
In the end I have got some slippage when filled my stop order at b/e price.

What I did not like about the trade:
I din't like the fact of being too tight to my trading price and basically to my main perception of price action. I have missed the point. Better saying once got the macro view of the trade I have missed the micro view of it. Once spotted the levels and traded accordingly I have then left apart some other levels that should have been taken as important. Then b/e or not, that is a secondary issue.

What I have liked:
I liked that I have got a nice entry time/price related and have opened an A+ setup trade.