RKT Trade on Mar 2, 2021 15:48 from Marius: Tradervue User Stock Trades.

Markets opened and traded flat after yesterdays first day of monthly inflows and bounce. Yields pulling back this week and bonds globally catching a temporary bid. Value, financial, energy, international, and commodity areas still stronger. Micro to small caps also showing out performance recently. Still in full earnings season and highly shorted companies continuing to find overwhelming buyers picking up demand and absorbing supply.

Fundamental Analysis

RKT operates in the mortgage finance business. The company is also an online platform that has been in business since 1985 and recently became public last year. The housing market has been very strong during the past year with the FED providing liquidity in the credit markets and keeping interests rates low. The pandemic also changed the working economy and many decided to move to suburban areas outside from inner cities working from home. The inventory is also lower and the rest of the housing markets, lumber futures, and homebuilders continue to show strength and demand.

The company reported earnings last Thursday with the markets selling off. It did report well with a special dividend, beat in EPS, and beat in REV. They also raised guidance. This was on the backdrop of the market selloff so not much of a bid in place until this week. The stock also has a short float of 38%. This has been a theme of recent with GME except this is a strong performing company that is also growing in a strong sector.

Quantitative Analysis

Intraday Fundamentals

RVOL 31.45
AVOL 17.85M
ATR 2.67
Short Float 38.09%
Shs Float 113.14M
Inst Own 73.80%
Market Cap 75.19B

Most RVOL in a trade I have been in thus far.

Options Statistics + Tape Reading

SI 7.907
IV 165.73%
IVP -
P/C 0.348
VWAP 35.387

1M call contracts traded with more on the ASK with 379k puts. Notable difference here and order flow may be implying more bullish price action.

Options data stats/notes day prior to catalyst (n/a)

Options Positioning

OI 2104
VOL 5588
Delta -.02
Theta -.05
Vega .00
Gamma .00
Prob T 6.59%
Prob ITM 3.51%
MMM +/- 5.992
IV Series 185.02%

Probably a trade where I also could have added more size. Keeping in mind to manage risks and step up my position in increments. The edge is present just need to refine more by adding more size into the trade initially. Adequate size to accommodate additional scales and or trades later into the week.

Options data stats/notes day prior to catalyst (n/a)

Technical Analysis

Noting increased IV and will see how this will effect positions into the week. Volume is huge here closing in the upper 25% daily range and on the ASK.

Notable HTF compression range breakout above 25. Fib extension 161.8% target of 45 hit in the pre-market as I'm writing. AVWAP breakout from VPOC accumulation.

Trade/Risk Management & Review

Exited trade as a scalp due to the price action at the open initially opening lower below 35.50 at Y bid from the pm session pull back. It traded below vwap for most of the open but then sold of more into the afternoon and breached 30 which was the breakout level from Y. This was managed via pre-set alerts and mobile.

I wasn't in the best trading state but had alerts and plans for this specific situation. I was able to see the order flow depth and options stats from mobile as well. Bearish but oversold close and still above key 24.50 level and holding the gap. Inside bar on the daily.

Grading overall as an A with excellent pre-planning executions and being able to take action at the levels noted. I did initial had exit orders in buyers took control for the next day but that plan was scrapped for the day. Seeing if this will be continue to be in play for the next couple days if the gap up level holds. More opportunities may arise seeing the set-up and gamma squeeze in the order flow.