Shared by
spyrosz
Got shaken out...
Met all the variables for a "Blow-off Top" trade today.
1. Parabolic Move - stock way over-extended from the 9-EMAs/SMAs @ daily + weekly charts
2. Previous day - big green candle that traded much larger volume than the previous days, closing near/at HOD
3. Today - stock gaps up even higher - exhaustion gap-
Many ways to trade it, all have one common thing:
Stock must lose VWAP & start trading below it w/o being able to break and hold above it. Stock must hold clearly below VWAP!!!No leaks above the m. average.
So I let it do its thing at the open, but when it lost VWAP and got rejected at the retracemenet back to the m. average to the penny, it was game time.
Short Tier 0, risking above VWAP, expecting the break of $14.4 and a move to $14 for starters. Wanting to add more size at any bounce from $14 back to $14.3-14.4s...
Had a bid to cover some at $14.05, NIO held at $14.18s and bounced higher. Reclaimed $14.4 and pushed above VWAP.
Got stopped out.
Should have expected it. It felt stuffed on the way down when it shouldn't. This thing should have crushed when it lost $14.4 the first time.
They had to stop out some shorts before the sell-off.
I saw it back at $14.4s but I felt like chasing (that's the exact purpose of being shaken out), so I left it alone.
Maybe it deserved another shot when it broke $14.4, retraced and rejected it to the penny.
Put a low at $12 for the day.
Can't win them all.
Execution detail:
| Date/time | Symbol | Side | Price | Position |
|---|---|---|---|---|
| 2020-07-08 11:21:17 | NIO | sell | $14.460 | short |
| 2020-07-08 11:21:22 | NIO | sell | $14.450 | short |
| 2020-07-08 11:59:47 | NIO | buy | $14.770 | 0 |
Comments
Leave a comment about this trade!
You need to log into your Tradervue account to leave a comment. If you don't have one,
it takes
just a few seconds to sign up, and it's free!
I did almost the same trade as you. I entered in short for 200 shares at 14.22 at 11:26:25. I held through the rally up past vwap and then took profits at 13:51:10 at a price of 13.69.
Despite being profitable on the trade, I should have exited on the first 5 min new high following that break down through 14.50. It would have allowed me to reenter on the new 5 min new low just after the failure to break 15.00. Price target could have been previous day close with a tiny stop above 15.00.