3/12/13 Trades: Before we begin on the prep for 3/13/13 which will mostly cover AAPL. I think its best to begin the prep by discussing the trades we made today, why we made them, what were the mistakes if there were, etc.
DeanSTrader Trades (3/12/13):
On first trade had great execution, however, on the second trade I did not benefit accordingly to the trend. I shorted AAPL via puts and averaged in on the bounce, only to take profits on arrival of weakness. The mistake is that I should have benefited from the trend that I was anticipating as it proved to be spot on with the target I had in mind. The plus is that overall I followed my prep. Following the prep, I wanted to see AAPL cross above 440 by 10:00. As the day began, AAPL showed weakness, only to break back above 435 and consolidate at the 437 level. At that point (9.40 or so) it seemed right to expect AAPL to in fact go above 440 by 10:00. therefore, the reason I got in the calls was because AAPL at about 9.43 showed good support @ 436 and setup to break the day’s high and potentially break above 440. So I got in and got out on a break above day’s high. As the stock was unable to break above 440, I started looking into the puts. Eventually I got in but like I said before, did not participate in the trend as I should have. Lesson is – “it is easy to be right, but not to sit tight”. Need to work on riding the trend better.
Stockhaven’s trades 3/12/13:
Size got bigger and bigger with each entry after a first loss, instead of smaller and smaller and averaging into strength on a position that is going your way. Too much running around in the first 3 minutes instead of focusing on prep work and how it applied to current trading environment.
I went put/call/put/call/put which i like since the action was so whippy first 3-9 minutes, but you didn’t reward yourself on the correct directional bet… hold that winner… 3 out of those 4 trades were actually the correct direction as it played out… a step to improve this is wait for a preparation signal to trigger before taking entry without evidence of overall trend established
shouldn’t have stopped trading just because you couldn’t buy back in lower than you sold.. don’t be stubborn like that
on a net basis, good job going short on inability to hit 440 in 9:45-10:00 period
Major error:
AAPL didn’t get hod by 9:39 as according to prep and that later to proved to be an area of demand exhaustion
My gut feeling coming into the day was “this is the bounce to 450 if it is underway… <438-441 and expect 429’s
AAPL:
W2W4 (What to Watch for):
- price action $1 above/below initial 3 min high/low
- More than a $3.28 move above open price.
- More than a $1.01 move above prior day’s close.
- A break below first 5 minute low, to signal a move lower.
- >300k 3mvp on b/d’s, > 450k on b/o’s
- rally off a 30 minute low that is > $3.41 to signal potential bottom, otherwise it could signal new 30 minute high
- A move > $1.88 above first 3 minute high as that is what it did today.
- lod flushes of at least .76 to signal further lows, .54 flush was bottom (3 min read)
- Bounces that are > than 1.50 – 1.70 to signal sideways action.
L2W4 (Levels to Watch for):
- 428.18 ($1.01) above today’s (3/12/13) close as resist level. This level can be important tomorrow as AAPL only went up > $1.01 from yesterday’s (3/11/13) close.
- 424.48-425.14 key support/432-432.50 key resistance
- 427.15 as it represents the MP (Midpoint) of last week.
SCENARIOS:
Bullish Scenario: ability to close a 3 min candle > $1 above initial 3 min high… hod’s by 9:39 on > .66 extension… ability to stay above/in the range that represents the opening price to the 9:33 high… must have 430 w/432.50 b/o during 10:00-10:30 period.. hold of 425 support keeps reversal in play with 428-433 target… > 433 and 440 back in play with 435 breakout
Neutral Scenario: ability to stay within a range between 427 – 432.50 throughout the day.
Bearish Scenario: ability to stay below/in the range that represents the opening price to the 9:33 low.. ability to go < opening 3 min low by > 1.23 by 9:36… need 3 min close that is > 1.05 below open..
Gap Up: Gap up needs new hod by 9;39-9;42 sequence and can’t go much below the opening price and can’t have a 3 min low > .40-.50 below opening 3 min low for 440 to be in play
Gap Down: on gap down an inability to advance > 1.20 above today’s close of 428.43 (by 9:53) and a move < 425 by 9.45, triggers a move to 420. While a move > 1.20 above today’s close w/breakout above 430 by 9:45 signals a move to 432.50.
kevin’s gut feeling: 424.50-426.50 gap down with failure to hold 425 overall and 415-420 in play… doubt it has any luck with a 430 bounce attempt
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