NTAP Trade Review

Trade Management

Journal Entry 1 - Earnings Falling Wedge Breakout (19th)

The price created a tight falling wedge, consolidating over multiple weeks following a powerful earnings gap up. The gap is strong and the price was never able to fill that gap completely, which is a major signal of strength. The price begun breaking out of the wedge with a clearly strong day, so as it moved above the pivot of $103 I went long with a stop went below the pattern.

Game-plan: Entry $103 vs $100.39, core target $112 (3.6R). 1st partial $107.50 (Potential resistance and 1.8R, just shy of 2:1)

Risk plan: Bought 5 shares ($15 of risk = 1R currently)

Total Risk Now: 1R

Journal Entry 2 - 130' Support Buy (27th)

The price moved higher and started to consolidate the recent price gains in a tight range, developing new support in the $104 area. Drilling down to the 130' chart to get a clearer view, the price begins to pull-back into the newly formed support area, and simultaneously allow the 21-period to catch up to the price and begin acting as support. This confluence gave me the signal to add to the position. (The 21-period on this timeframe is roughly the 7-8 day moving average, but I just prefer looking at it on here than on the daily chart).

Game-plan: Entry $104.75 vs $103.89 for the new add. The core position stop remains unchanged.

Risk plan: Bought 3 shares ($3 of risk = 0.20R currently)

Total Risk Now:: 1.2R (Realistically I should never allow risk to exceed 1R, but where adding 0.2R of risk can increase the profitability of the trade by 50% or more, I'll bend the rule marginally).

Journal Entry 3 - Consolidation Breakout (28th)

I added a little heavier on the breakout of consolidation because I was able to raise my core stop. The breakout failed though and never really got moving -- going into a long weekend with news coming out during a closed market makes me feel uncomfortable. I've dumped the shares I added from yesterday (the 130' support buy) and I've also got rid of the position I added today from (the consolidation breakout) so I'm back to just my original position but now with my stop raised to $103.89.

Total risk now: Breakeven