TICKER: TWTR
BIAS: LONG
SUPP: 32.50, 32.80, 33
RES: 33.3, 33.5, 34, 34.50
GAP%: 0.55
AVGV: 10.7
ATR: 1.0
NEWS: Bank of America Merrill Lynch upgrades Twitter (NYSE:TWTR) from Underperform to Buy and raises the target from $31 to $39 citing its survey showing "improving metrics in the 18-29 demographic." Key quote: “Nine percent of users indicated they planned to use Twitter more next year, up from 6 percent in our 2Q survey.” If Twitter continues improving engagement and its direct response advertiser base, the firm sees the potential for "significant ARPU increases."
PLAYBOOK TRADE: OPEN DRIVE LONG. Look for a hold of support at $32.50-33.00 early in the morning and fight for price to get long at the bottom of the initial consolidation range with a further break of the $33.30-33.50 level for a move toward $34.00.
NOTES: The stock has consolidated for 6 days between $32.50-33.50 and is set of a range breakout today above $33.50 toward $34.00 as it is showing some strength premarket on this good news. My first attempt was to take the long on a break of $33.10 with a stop just below $33.00, but this was impatient and I needed to fight for price better. After getting stopped out I looked for the stock to put in a local low and aimed to enter in the bottom of the morning consolidation range. I took $32.92 on the way back up with a stop of $32.69. My target was to take a partial in the $33.90's and take out the rest on a break of the $34. This didn't happen and I added 20% to my size on a pullback to $33.64 expecting to find support there. When the stock started showing signs of weakness I took my profits after holding below VWAP on the tight consolidation break to the downside at $33.33.
Execution detail:
Date/time | Symbol | Side | Price | Position |
---|---|---|---|---|
2019-01-18 09:36:41 | TWTR | buy | $33.100 | long |
2019-01-18 09:38:07 | TWTR | sell | $32.960 | 0 |
2019-01-18 09:38:51 | TWTR | buy | $32.920 | long |
2019-01-18 11:08:22 | TWTR | buy | $33.640 | long |
2019-01-18 14:19:09 | TWTR | sell | $33.330 | 0 |
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