Shared by
Emilie_BOWS
Daily: gap up over resistance
Intraday: VWAP breakout
Stock ran up in pre-market session and was pulling back on the open. I took the long as it broke above VWAP and added on the new HOD after the 1st pull back to the 9 EMA.
I scaled out 2/3 at the big spike that also looked exhausted and got out when it couldn't get above $11.
Execution detail:
| Date/time | Symbol | Side | Price | Position |
|---|---|---|---|---|
| 2017-04-11 10:12:12 | NUGT | buy | $10.420 | long |
| 2017-04-11 10:51:48 | NUGT | buy | $10.620 | long |
| 2017-04-11 11:00:01 | NUGT | sell | $10.920 | long |
| 2017-04-11 11:45:01 | NUGT | sell | $10.970 | 0 |
Comments
Emilie_BOWS
Thank you for your questions. They help me too so please do not hesitate to ask.
NUGT: Daily was a long because of the gap up over resistance. When I looked at intraday chart with pre-market price action, I saw the move up so I was thinking long. When it dipped out of the gate, I still thought it was just pulling back and I looked for a reason to enter long. If it kept going lower instead and retraced deep into the gap then I would have changed my mind about the trend. When it started approaching VWAP I got my reason to get in.
There was always a possibility for it to fail at VWAP but the context was good for a long than a short there. Obviously if it failed VWAP then I'd have taken the loss. The context is different if something falls deep under VWAP, stays under for a long time then goes up to test VWAP.
I didn't buy at VWAP later because the breakout in the morning wasn't strong enough for me to take risk trading it midday.
BABA, QCOM float are too big. I'm not sure where you played BABA because it was down all day ? Anyway, big floaters tend to pull back after a big breakout day rather than continue on the 2nd day. UAL flag was ok but it could go either way. When I saw all people on StockTwits screaming short I knew it wouldn't work. HUBG didn't show enough momentum for shorting. It dipped under $40 then bounced quickly and stayed above $40 the whole time. There was no reason to believe shorts had any strength there.
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Hey, I was stalking this trade as well due to the daily setup but didn't take the trade. I was thinking about it when it was sort of flagging above the HOD (where you added) but didn't take it.
I know gold tends to fake out a lot so what made you think it was ok to buy it just when it was coming into vwap? I know the daily setup looked good but intraday what made you think it wouldn't just fail at vwap and go lower?
When would you use this specific trade of buying when something gets over/under vwap? I ask because I would think that unless there is a certain pattern you look for, that buying right at resistance (vwap) wouldn't normally be a winning strategy.
Also, would you have bought at vwap later in the day around 12:20?
I hate to keep asking all of these questions but I really appreciate the advice. I have been incorporating a lot of it into my trading.
Were you looking at any other stocks today? I tried BABA for a continuation move in the morning which didn't work and tried QCOM and UAL on their bear flags which didn't work too much either. They both broke below significant levels on their charts so I thought it was worth a shot. I also tried HUBG when it was consolidating under vwap but it just shot up immediately after I got in.