WMT Trade on Feb 21, 2023 11:06 from Maarten: Tradervue User Stock Trades.

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Maarten

 

WMT 21-2-23
Premarket notes
Catalyst: Earnings beat but weaker guidance
Setup: Negative earnings reaction. -2.9%. -2ATR
Technicals: Double bottom formed below the 50 SMA. It’s trading in a range after a bigger down trend. Last period price was trading up and consolidation. There is a close support.
Pre volume buzz: 18.6%

For a short setup, the catalyst is great and the reaction is very decent. When I look at technicals it looks more like a reversal play to me: short uptrend preceding the gap down. Strong and near support areas that are just below the current price. Would give it a 6/10 for a short. But once we get strong intraday price action, I would be bullish for a gap reversal.
10-11AM notes
This weekend I studied some the technicals of gap down reversal setups. And now I spotted called one in premarket. This is the scenario I would like to see. We have made a very big bounce already: 2.5ATR. Volume buzz is 617% very solid. Just broke through resistance (PDH) I would like to hold this and then we could have a ZI scenario. It’s pretty clear we are trending right now. I will be ready to trade the first clean pull in after 11AM

Gap down reversal/ Negative earnings reaction reversal cue’s
-Prior strong price action after a double bottom. Small uptrend just to show that investors have been willing to buy recently.
-Significant and/or near support levels buyers may be willing to step in.
- Reversal started already premarket.
- Intraday price action needs to confirm with strong ATR moves, elevated volume during the open/morning.

My first PB entry
-After extreme strength: 2.71ATR (neutral)
-2nd PB, First shallow PB failed. (bearish)
-After potential top: High elevated volume + increased selling. (bearish)
- PB of support: PDH (bullish)

Getting in after first shallow PB failed.
When there is a Gap open + strong drive, I should expect a shallow PB. This first PB failed.
I think the first PB I trade wasn’t that strong. Was after a first shallow PB had failed. Yes it held support, but the volume on which it failed was elevated and indicated a potential HOD.

My second PB entry
-Very shallow volume
-Holds support.
-Doesn’t bounce breaks down support on elevated volume.

How successful were you in identifying the market environment and playbook variables during the trading session?
Not great we had a
-Strong drive
-1st Shallow PB of PDH that failed.
-High volume at HOD followed by high volume in retracement = potential top. Supply overtakes demand.

I should make note of this price action next.

Ideal entry after extreme strength.
I think the ideal entry is after a candle that does below average volume. My third and fourth entries occurred at this point. I should aim to get in when the volume is shallow. Especially after an move of extreme strength, when the a reversal /trend change is more likely.

Execution
I was almost perfect on my exits. My entries were great. 1 out of 5 was at 25%, the others were lower. The first exit I stopped out because the setup quickly reversed on me. I don’t know about this exit. Will look more into it tomorrow.
Next two exits were good reasons2sell. Up 1.5R and position reversed on me, could have done better minimizing the loss. Third exit was 1R loss. Fine.
I got back in later, was up 1.5ATR, added and position reversed on me. Adding caused a 1R loss. Had I not added I could have gotten out breakeven. From now on this a poor execution: it's not One Good Trade when I do this anymore.


Execution detail:

Date/time Symbol Side Price Position
2023-02-21 11:06:26 WMT buy $147.360 long
2023-02-21 11:09:00 WMT sell $147.100 0
2023-02-21 11:12:14 WMT buy $147.320 long
2023-02-21 11:30:14 WMT sell $147.110 0
2023-02-21 11:35:29 WMT buy $147.290 long
2023-02-21 12:08:05 WMT sell $147.010 0
2023-02-21 12:53:24 WMT buy $147.030 long
2023-02-21 13:21:34 WMT buy $147.410 long
2023-02-21 13:27:41 WMT sell $146.980 0


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