Shared by
dimaspivak
This is a great trade, noticing the false breakout of a stock and waiting for a good entry before getting in. I just wish I had the confidence to have made this trade with real money, but I had hit my profit target for the day so followed my rule to switch to the sim.
Execution detail:
| Date/time | Symbol | Side | Price | Position |
|---|---|---|---|---|
| 2018-03-06 10:52:01 | TGT | sell | $72.880 | short |
| 2018-03-06 10:54:18 | TGT | buy | $72.410 | short |
| 2018-03-06 10:54:59 | TGT | buy | $72.350 | short |
| 2018-03-06 10:55:03 | TGT | buy | $72.290 | 0 |
Comments
dimaspivak
Hey Joshua, the volume dying out and then the huge drop back to VWAP 5 min or before I went short put me on watch to get a good entry if it was a false breakout. When I saw that it was pushing back up, volume was again much lower than the first time and I remember noticing that the orders coming in were in much smaller lots than when it broke through VWAP the first time.
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Dima, how could you tell this was a false break out? Looking at the 1 minute chart, it appears to have made a double top, with the second top being lower than the first. Is this what you were basing your short trade off of? What else do you look for to signal a false breakout?
-Joshua L