Warrior Trading Blog

One & Done! +$900 in 15 Minutes! | Mike’s Trade Recap

Mike_5.8

Good morning guys. Just over $900 bucks in the first 15 minutes of trading, I’ll take it. That’s where we ended the day today on one quick trade out of the open to the short side on MYL for a really nice breakdown in the first 15 minutes of trading. Really nice to lock up a win and be done for the day. So let’s take a few minutes and break down today’s trade on MYL.

Alright, good morning guys. I want to do a quick recap here on our trade this morning on MYL. Wasn’t the biggest hit by any means but it was definitely nice to have a nice profit in the first 15 minutes of trading. So we’re up just over $900 bucks. Quick trade out of the open today on MYL to the short side for a few hundred bucks here and we wrapped it up early just because MYL’s actually going into a conference call at 10:00 and those are not something I trade through. And we’ll talk about that in a little bit more detail here shortly. But with that said, still a really nice way to come in for the first few 15 minutes of the day.

Let’s break down the MYL trade. First off here, we had some news on this this morning. It was gapping down below its major moving averages that’s one thing I always look for if I’m looking for a trade to the short side. So we had that, and we also want to take a look at a daily and see what type of support and resistance we had.

The first thing that popped out to me right away was we had a triple bottom here. You can see it bottomed out three times and we were starting to approach that level and if that level broke I wanted to be watching this very closely because that’s a very significant technical point. When significant technical points break, you typically see a violent reaction. And this is what’s happening again here today. Below this 26 point we had a pivot at 2520 which was a major market pivot as you can see, goes back here all the way to around 2006, tested again here, tested again here pushes up, comes back and we were testing it again today. So major market pivot we wanted to be aware of but then we opened up into a really big pocket that really didn’t have much support until about 20 and a half. So MYL really good looking trade here, technical breakdown and we had this on our watch. Basically below this triple bottom here at 26.

So what happened was into the open, and also to note here before the market opened, we were aware that there was a conference call that is at 10 a.m. and just a bit about a conference call. I don’t trade through conference calls. If I’m going to trade a stock it’s going to be before the conference call starts or after the conference call is at least half way done. Now the reason for this is that going into a conference call its basically unknown risk. You do not know what’s going to be said, number one and number two you don’t know how it’s going to be accepted. So those are two factors that we cannot control and could greatly affect the price. Since I cannot have any control over those or have the least bit of predictability it presents me with a very large unknown risk parameter and that’s something I do not want to be a part of. So I chose not to trade through them.

Now there will be situations like today where a stock just continues to move on momentum even though the conference call is going on and there’s no sort of whipsaw action or reversal type move to blow you out but more often than not, much more often than not, there will be those kind of whipsaw crazy action during a conference call which could turn a decent trade or a really good trade into a bad trade. And I don’t want to be a part of that situation so I chose to just not trade through a conference call whatsoever. So that said, that’s why again, I got out of this trade early and I wasn’t able to capture the move because again when I was out respecting the rules.

So let’s talk a bit about what happened here. Now remember this was on our watch list for a break below 26. So out of the open we started to get a little bit of a fade here, we can into the support just above it, bounced, rejected the VWAP, started to sell back down and then we made the break. We made the break below the pivot which is what you want to see. Volume on the trigger. This is really important to validate the level. There’s volume through the level that’s important to see, we start to come back up, retest, retest, fail, right here’s where I got short at 2580. 2580 I got short, held in through here, we made a really nice pivot, came back up to retest again and failed. Started to fade, looked really good and I took off some of my position down here through 2537, about half. And then I said, you know what? We got a pop and a pivot higher, looked like we were going to resolve back higher and I just took the balance off as we were coming to my breakeven.

I actually added to this as we started to break down. So once we had this sort of retest put in on this third candle right here after we break down, because we started resolves. So I was looking at this in real time. We came up for the retest, we’re failing the retest, I got short on the failure 2580. We started to bounce around and we came up again for a few moments then started to pull back off that. When I saw that we doubled top right here on 2590. I added as we were coming back through 2560’s and 50s. So that brought my average down to around 2570. So I added as we were trying to anticipate the breakdown since we were rejecting the retest. We were rejecting the retest so that’s why I was adding as we were starting to break down trying to anticipate the momentum move. And we started to get it.

We started to come into lows here and this is where I took half a position off. So 2537, 38 is where I got filled and then we popped off that level kind of hard and as I saw this higher low get put in, it looked like we were resolving higher right here. We were kind of near the support, we had almost double bottomed in through here. I was a little bit concerned that that was going to be the move and we were going to get a retest back up to 26. And if I get a retest back up to 26, I would have taken about a 30 cent loss on a balance in my position.

So I decided to stop out and call it a day there. Especially since we were starting to approach the conference call time at 10 a.m. So that happened and then we started to resolve lower, we came into the pivot here at 2520 and we started to break right before the conference call and that was kind of a tough situation. I would have really liked to get back in this trade as we broke this but again, got to follow the rules. Its really important because I know that most of the time those conference call trades are very whipsaw. They’re hard to manage, they’re risky and there’s no real reason to be a part of that when you don’t have to be. So this is the situation today where it actually played out pretty nicely and continued on.

This is when the conference call started. You can obviously see these whipsaws taking place was when people were speaking on the call, asking questions and whatnot. And this one did continue nicely but that aside, technically is what you want to pay attention to on this breakdown is that we had a really nice daily chart, we were breaking down through a triple bottom, we had a lot of volume, we put in a nice pivot below the level that we were watching below 26 on the fast time frame. Everything we wanted to see and this is what happens, you know right? Conference call aside, technicals drive the move and this just further confirms that fact.

So really nice move on this. Good job to you guys who were able to hold through the conference call and let this trade continue. I just was in a situation where, I didn’t really want to give back what I had locked up and being down the first 15 minutes is nice too. So in any event guys, that’s the trade on MYL and we’ll wrap it up for today, be back first thing tomorrow morning.

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