Warrior Trading Blog

$AAPL for $680! | Mike’s Trade Recap

aapl

All right. Good afternoon, guys. Let’s go ahead and do a recap of this morning’s trading action. It was actually quite muted. There really wasn’t a whole lot to look at, but we were able to pull a quick trade, more of a cash flow type of trade out of Apple since the market was so strong, which you know Apple wasn’t really on the watch list per se.

 

It kind of always remains in the background because it is a higher profile name. Obviously when the market catches action, these are the stocks that are going to first feel those effects. I jumped straight to Apple. We had a nice set up there because it was holding above its 20 moving average.

Basically the trade on this was a move off the VWAP, right? We pulled back to the VWAP. We held a nice strong move to the upside off the 20 moving average. We started to push up here, and I got long right around $221.40 as we started to resolve here higher. Just simply looking for a push through to $222. Sort of a breakout type of play to see if we can get the continuation with the market. Now I sold most of it as we push through $221.90. I sold a bunch. We pushed through $222. I sold a little bit more at $222.10 and then I held it to see if we could pull back, consolidate. I didn’t like this pull that we got, so I just stopped out breakeven.

Just under 700 bucks for the day. It’s again one of those days we’re still grinding on the low numbers. We haven’t really been able to hit any sort of big trade, but that’s okay. I’m totally fine with grinding along on these low numbers until we start to see that continuation return, which we’re just not seeing right now. We talked about this in a couple of our recaps a couple days ago where we’re just seeing these quick moves and they snap back and they start to go sideways. All right? Let’s dial in a little bit faster here so you can get a better idea of my entry on this, so you can see exactly what I saw as I took the trade.

What we had here, Apple started to dip first thing out of the open, but then we came back and we went basically red to green, right? We got above the high. I waited for this move to pull back to see if we would hold and we held this level right in through the open. Let’s see. There’s the 20 moving average. There’s the VWAP. All right. We got back above here. All right. Really important spot. Now the fact that we had the morning range right here, so if I draw a line at that point right here, I extend that out. We also had the VWAP and the five minute 20 moving average sitting right here. A lot of support in that area.

I wanted to see if we could pull back and hold that. We started to move back to the upside, and this is where I got along right in through here. A bunch of volume started to come in, right? A bunch of nice volume started to come in and push it up. I got long, $221.40s. Sold a bunch $221.90. Sold more $222.10. Then I stopped out as we broke the base that we had put in basically right in through this area here. Once this base broke, I just cut it loose. It also happened to be pretty much right at breakeven, and I pulled in just under 700 bucks, which is a good day. I’m fine with it.

I was up a little bit more, but I was trying to look for that continuation since the SPY was so strong, right? The SPY was strong. Really moving nicely. Big breakout day. I was hoping we’re going to see some continuation in that name, but unfortunately, it just didn’t continue, but that’s okay. We’ll just keep grinding along until we start to see that momentum and continuation return. Now as far as the stocks go that are on the watch list, we had RHT. It’s just this thing was just way too volatile out of the open. We talked about this for several minutes on the watch list about how volatile the stock is.

It can be quite dangerous to trade, so be very cautious. Of course, the market opened and this thing had a huge range and just all over the place. The spreads were wide. Whipsawing around. Just really makes it tough to get anything started and that’s again the type of action that we’re seeing. We’re not seeing those big continuation moves. It’s these quick moves and snap back and then they don’t really do much. Glad I stayed away from that because that probably would have been a nasty trade if I started to size into that. We started to whip around.

Plus the market was really strong and that was one of the warnings I was telling everyone is that you don’t really want to be short when the market’s breaking out to new highs. It’s just not something that really typically makes the trade work. I decided to pass on that trade and kind of looked towards Apple. The other ones we had on watch, DRI. That one looked okay and it did end up fading quite nicely. Just the volume was anemic, right? There was no volume in this. When you run the five minute chart here, in the first five minutes of the day, we traded 147,000 shares worth of volume. That’s just barely anything.

I’m usually looking for at least 500K or more. We just didn’t even get it close to that. When the volume becomes anemic, I stay far away. All right. That was DRI. Another one we had on watch this morning that we were looking at was THO on there. This one actually did end up fading. It started to turn over nicely here, but I was involved in Apple. Again the volume wasn’t too great on this. 181,000 the first minutes. It’s just really not enough. It’s well below my minimum threshold. When it’s well below my minimum threshold, I really don’t pay much attention to it because we need volume to create the momentum.

If it’s not there, it becomes tougher to trade and we typically don’t see the best price action, so I decide to stay away from that. All right. But that’s okay. We were still able to pull out a decent trade for the day. In any event, guys, that does it for today’s recap. The SPY is really, really strong right now. It’s making trades tough, right? It’s just kind of grinding higher. Volatility is just at the very lows, so there’s not much movement going on. We need to see some momentum come back into the market here to help trading become a little bit easier, but until then, we’ll sit tight and play defense because that is something that will go a long way.

You may feel that you’re not making much progress because a lot of the times we see progress associated with profits, which to an extent is true over time. If you’re sitting tight and playing the defensive game, you’re actually really developing a skill that goes a long way and that’s progress in itself. Be happy with that and we’ll be back here first thing tomorrow morning. If you’re still watching, you must have really enjoyed that video, so why not subscribe and get email alerts anytime I upload new content. Remember, when you subscribe, you become a member of The Warrior Trading family.