Warrior Trading Blog

Taking a Big Swing at $JD and a Miss | Hulkman’s Trade Recap

Hulkman_5.10

How’s it going with traders? My name is Hulkman. I’m a junior moderator here at Warrior Trading and I wanted to go over today’s trade recap. Today we traded JD. Unfortunately, it is a red day represented by the Red Bull I got back here. That’s okay. We managed well. I took the largest position I have in 2019. I was really swinging for a home run today. That didn’t happen. That’s okay. Let me go ahead and show you guys on the screen how I traded it.

So today on watch this I had a few that I liked. Now, coming into today, I did know that we had some major economic macro news going on today with the China tariffs and vice premier going into a meeting with Trump. So I was very cautious going into the day. I know that we are very susceptible all this week to headline risk. So I didn’t take anything initially out of the open right away. Really wanted to see something confirm and pop out at me that it was going to work. What I saw here that I liked was initially this Roku. I was looking for Roku to, after a massive day that it had yesterday, I wanted to see a little bit of profit taking. Now, we started to get this higher lows, higher highs, all the way into the open and what I wanted to see on this was some profit taking take place for a move down to previous highs.

I was going to look for a VWAP fade trend continuation setup, something along those lines to get us back down to this previous highs before making the next leg up. But right out of the open it just popped, a lot of strength. That’s okay. I took that off to watch list. Didn’t trade that. Then I had this SYMC. SYMC, I liked. We have this major macro trend line here off the daily chart, a few years old and has been respected very well. I wanted to see this fail. We also have a very strong daily pivot here with a lot of tests. The 17.40 pivot is a big, big pivot. I wanted to see this fail, get below the 17.40, fill the pocket down here to 16.30. This was my game plan. That didn’t happen. As you can see right out of the open it caught support, went back up, stopped watching that.

Then the third one on my watch list was this JD. Now JD, I did like out of the open. At this point here, once I saw this move up, I was like, “Okay.” I put that on the back burner, so I started to watch the other two. I know we had this big area here of support at this point. Now, support later on became into resistance, but I didn’t take any of this out of the open. Like I said, I know we’re susceptible who headline risks as well as look at this big extension candle. You can’t trade on an extension candle like that. So what I did is I sat patiently. I was watching it. I started watching it right around here as we started to fail. This was still too extended for me to take a trade. If we would have popped up to VWAP, maybe I would have tried it or at least that would have gave us more confirmation. But that’s okay. I watched it and let it rollover.

Now, what I was watching on this was for a retest. Retest of this resistance so look at this resistance. Now, I am a big, big proponent of keeping your charts clean and typically my charts are very, very clean. But now look at all this area of resistance. This was easily telling me it was going to be a home run trade. Now we have decreasing volume as you see on the move up. Get rid of that. Now, what I saw here is as we started to pop up into this resistance zone, volume was just holding steady and kept decreasing little by little. Now I know JD lately has been a crap trader on earnings, so I was pretty cautious of that. What I wanted to do here is build into a position rather than taking just a one or two stab entry like I typically would.

So I’m going to show you guys here my granular timeframe. Right here I started to watch it. It failed hard, came back up, retest. Started to see the volume decrease and decrease. I took my first entry right here. Now I know JD trades kind of whippy at times and lately it’s just been not that good of a trader so I want to see what kind of move we would get, how to stop above VWAP here. I was like, “Okay, we get above VWAP, I’ll stop out.” This is a very small starter position. Once that we popped up, got to VWAP, saw the rejection, I added more right as we started to fail here, added more on the lower high right before we got to the 20 and as we broke through the 20 EMA here, I did my last piece on this lower high pivot.

Now, this was my largest position of 2019. I was really shooting for a home run here. What I was looking for was for this to just continue to roll over into low of day. I was only looking for about a point out of this. I took about just over 5,000 shares. I believe I had 5,400 shares. Would have made for a great great day. But what I started to see is, let me remove all these, saw this speed line, but this speed line. This is a descending speed line. I did not want to see it break above this speed line. Now we started to consolidate here, consolidate a bit, consolidate a bit as you see at this pivot. Now this pivot zone is where it came up, the very first relief or retest before it failed hard. So I put this dash line here and I wanted to see this fail relatively quickly.

Now once I saw that that wasn’t failing, I put my hand on the trigger. I was like, “Okay, we get above this speed line, I’m out.” Started to make a lower high here and I was like, “Okay, we’re in the money. This should go.” Did not go. Typical JD action. Like I said, JD is a crap trader. As soon as we popped up, I exited pretty much at the breakeven. Stopped out with $38 red and that was the trade. After that, you can see it in hindsight that it weren’t, but let me show you guys what I was looking at it in real time. This is important.

Once a stock gives you an inflection point and you have a good entry like that, you really want to see that thing go. There’s no reason to hold longer than what you’re supposed to or longer than what the chart is telling you. I knew we were there at the inflection point. Look at the volume. We had an increase in volume right as we started the push away from VWAP. Exactly what you want to see. Decreasing volume on the relief move. Perfect A-plus setup. I would trade this again and again and again. But like I said, we started to hold there. Now I saw that we weren’t failing. The range of this candle and pushing away from that 20 relatively quickly and I was loaded pretty heavy in this. So once I saw that, I recognized this as a higher low. You can see, first low here, higher low. I thought we might get a pop up.

Again, coming back to the granular timeframe. These granular timeframes are powerful, guys. Once we broke past this descending speed line, okay, the trade is broken for me and I went ahead and got out. Now as you see, it came back up, tested the VWAP area and went ahead and rolled over after that right to our profit target. Look how clean it touched this pivot, right to our profit target. That’s okay. I would trade it again. Like I said, with this, yes, you could have taken a second entry but with the size I had, important to be in control of the mind state that you are in and if I would have taken this again for a second or third try, then I know myself as a trader, that will lead me into overtrading for the day and into frustration.

So I took my initial stab. Most of the time I’ll take one or two stabs if I’m at mediocre size. But because I went heavy, stepped back a bit, regathered my thoughts. I missed the second entry, but that’s okay. Part of trading is risk management and controlling yourself and knowing yourself. So I feel like I traded this well. I know we’ll catch another big one here. We got a little bit more left on the earning season before summertime slows down. Yeah, before I forget, let me show you guys the P&L here. I like to go ahead and put the P&L up. As you see, $38 red. Big size today. Didn’t happen. That’s okay. Be back next week for another fresh week of action. I am green on the week, green on the month. Doing okay. Hopefully next week we get better action. We’ll see.

So I just wanted to go over today’s trade. Hope you guys enjoyed the recap. Comment below. Let me know what you guys traded today. I want to go back and read through the comments. Thank you guys for watching. See you back Monday. Have a great weekend. Happy mother’s day to all the mothers out there. See you Monday, traders.

Oh, hey, I didn’t see you there. Well, I was just working on the dream board for my next home run trade. Hopefully it comes soon. Until then, make sure you subscribe to get email alerts anytime I go live or upload new videos. Until then, happy surfing.