JPM Trade on May 27, 2022 13:50 from td2022: Tradervue User Stock Trades.

Entered this trade following short squeeze technical analysis (Dan Rawitch strategy). Our plan is to exit if a breakout doesn't materialize immediately.

Risk: $80
Exit Plan 1: We will close the position if the underlying drops to $129 ($130.07 at entry)
Exit Plan 2: Sell one call if we hit a profit of $80 and let the "free option run"
Underlying Price Target: $142
Profit Target: $240 (3x of risk)

Concerns include entering on a Friday of a 3-day holiday weekend, and trading a strategy that we haven't back tested or paper traded. But we are keeping our risk defined and maxed at 1-2% of our Net Liq. Also, not sure if we picked the correct expiration with only 21 DTE, which probably has accelerated Theta compared with a contract further out. And we may be entering this trade too soon (see resistance around $133)

6/3/2022 Exited Trade
P/L: -34.53 (including comm and fees)
What we learned:
1. Shouldn't have entered this trade because of the resistance at $133
2. Should have exited the trade when the breakout didn't immediately materialize
3. We need to define "immediately" and incorporate that in our trading rules. From now on, immediately equals exiting at the end of the 3rd day of a trade if the underlying doesn't break out. We also need to define "breakout."
4. Maybe... should have entered on a contract with longer DTE because theta was accelerated. However, had we followed rule 2 that probably wouldn't have mattered.
5. New Rule... if a profitable trade takes a breather, but the candles (Ashi) don't reverse trend, we stay in the trade. This will be tested, and if we find we give up profits greater than we gain by staying in trades, we will change the rule to exit if it takes a breather of two days.