David

18 // learning how to swing trade

[David @david_81889]

Yesterday‘s trades:
bought $LABX, $PTIR and $SKUU. Got stopped out of $LABX and $SKUU and closed $PTIR for flat.

Today‘s trades:
Bought $ALAB and $SOXL as UNRs.

[David @david_81889]

@HeckendeHecke I wanna help others become 4 figure traders

[David @david_81889]

Trades today:

10% positions:
$MVLL @ 37.75; Stop @ 36.67
$INTC @ 116.95; Stop @ 115.36
$MSFU @ 41.78; Stop @ 40.63
$TENB @ 37.52; Stop @ 36.9

Added 5% to $TWLO @ 293.68; Stop @ 287

[David @david_81889]

September Recap:

Up 5% in September: had some success daytrading breakouts on the daily timeframe early in the month, and shifted towards buying U&Rs of SMAs and gap zones later on.

My key learnings: focus only on liquid leaders, avoid large spreads, and keep stop losses tight.

[David @david_81889]

@NickDrendel do support/resistance zones (MAs, support gaps etc.) become weaker when price has already moved to the same zone several times?

[David @david_81889]

@i_managed_risk @i_managed_risk impressive stats!! How do you achieve such oustanding returns with only 0.25-0.5% risk per trade? Is it because you often buy on weakness, so you can have really tight stops and therefore take larger position sizes?

[iain @ohiain]

$MU is probably one of my favorite stocks in the market right now.

I also have absolutely ZERO interest in buying it here.

Let me explain why... 1 rule I’ve developed from getting punched in the face enough times is that I generally don’t buy recent momentum directly into a resistance gap.

I don’t care how strong the stock looks or how badly I want exposure. If there’s a large overhead gap where price previously broke down, I assume there is supply there until price proves otherwise.

Think about the psychology of who owns shares inside that gap. You potentially have buyers who bought before the breakdown and have spent weeks/months underwater. As price finally rallies back toward their cost basis, some of those people are thinking, “Thank God, just get me out at breakeven.” That creates supply.

At the same time, traders who bought the recent momentum are sitting on increasingly large gains and have an incentive to take profits as price runs into an obvious resistance area.

That’s why I want to see digestion, NOT immediate continuation.

With something like $MU, I’d ideally like to see at least a week of boring PA inside/under that resistance gap. Let the 9EMA catch up, watch for ranges to contract, volume to dry up, and let the stock absorb people who have been waiting months to sell while NEW buyers continue supporting price. I want sellers to have every opportunity to knock the stock down...and fail.

If $MU spends a week or a few days going sideways after a huge move instead of immediately puking, it tells me that supply may be getting absorbed. Every day that sellers have an opportunity to push price lower and make little progress makes the chart more interesting to me. It's important to know that time can heal an extended chart!!

And selfishly, waiting also gives me something I desperately need...a place to be wrong quickly.

Buying vertically into a resistance gap usually leaves me chasing price with terrible r/r. Where does my stop go? LOD might be miles away. The 9/21EMA might be nowhere close. I’m essentially betting that momentum continues immediately, and if it doesn’t, I’m sitting through normal digestion with a horrible average.

I’d MUCH rather let $MU become boring again.

Give me a week+ of digestion. Let the moving averages catch up, potentially lose/reclaim the 9EMA, build a higher low, tighten up, and then start curling up the right side again. Now I can use the 15/30 minute chart to look for my pivot, VWAP reclaim, first HL, etc., with an obvious pivot underneath me where the trade is wrong.

I might miss another 5-10% waiting for that. I genuinely don’t care.

I’ve learned the hard way that recent momentum does not automatically equal a good entry. My job isn’t to own $MU every day it goes higher. My job is to wait until the stock gives me an asymmetric opportunity where demand is still obvious, overhead supply has had time to get absorbed, and I can define my risk tightly.

So $MU can keep ripping without me for now. I love the momentum, I love the relative strength, and I’m paying VERY close attention.

But until it digests this resistance gap and gives me another setup off the moving averages, it’s a great stock that simply isn’t a great trade for me yet.

Do as you wish with this information. Godspeed :))

Chart: $MU.

[David @david_81889]

@ohiain Didnt have that on my list, thanks.

[David @david_81889]

@ohiain $BE is fighting against its group at the moment ($PLUG, $FCEL, $BLDP). Or are there other names from that group acting well like $BE?

[Francesco @FranVezz]

If trades are working, then I am pushing.

If setups are there, the watchlist action is good, I am pushing.

If position progress stalls, I slow down.

If stops are hit, I slow down.

If price action gets wide and loose, I slow down.

Each day, I try and get better at smoothly adopting this.

[David @david_81889]

@FranVezz @FranVezz Would you consider $PANW a laggard conpared to names like $OKTA or $CRWD as they‘ve already broken out to new highs? So would you say it‘s better to wait for a setup in the leading cyber security names?

[Francesco @FranVezz]

There are still plenty of nice setups still, but we're getting to the point where the elite merchandise have moved from their lower risk spots.

Careful to not be buying laggards from themes not in favour, as the rally drags on.

Your capital will tied up when the elite names start their flags, which WILL come if this move is real and longer than a week.

Personally focusing on waiting for spots in $AMD, $INTC etc.

[David @david_81889]

@RealSimpleAriel @RealSimpleAriel did you buy the ETH breakout today? If not, was there a specific reason besides already owning IBIT?

[David @david_81889]

August recap:

Got no traction in breakouts, and even those that moved in my favor stopped me out within days.

EPs worked well though, caught $QMCO and $HTFL.

Ended the month down 2%.

Overall, okay results. Not an easy swing trading environment. Still plenty of room to improve

[iain @ohiain]

If every breakout keeps going...

🚀 → 😀 → 😐 → 😭

Maybe stop buying breakouts for the time being!? The market is telling you what isn't working.

With the current conditions we're in, I'd much rather buy AGAINST a pivot than THROUGH one, s/o @ShakePryzby1, the goat.

[peoplewish @Peoplewish]

I promise you, if you’re a swing trader, this is not the type of market where you move the needle.

[David @david_81889]

@theboldtrader Yeah, risk-off market.

[David @david_81889]

@theboldtrader The theme is weak and the earnings beat wasn‘t an operating result. About $1.5bn of it is a deferred tax valuation allowance release. So not a big surprise that it failed imo.

[iain @ohiain]

If you're struggling in this envrionment read this post.

I think 1 of the biggest jumps I made as a trader was realizing that my job isn’t just finding good setups, but recognizing when the market is actually paying for them.

There are risk-on periods where it almost feels stupidly easy. Breakouts follow through, pullbacks get bought, leaders give you immediate cushion, and every time I put a little risk on, the market basically says, “Yep, keep going.” Those are the environments where I want to progressively increase exposure because my trades have earned me the right to press.

Risk-off periods feel completely different.

The exact same setup that was running +15% 2 weeks ago suddenly breaks out, goes +2%, and round-trips by lunch. My stops start getting hit, fewer names are holding gains, breadth deteriorates, and my equity curve stops progressing. I think of it like surfing...I can have the nicest board on the beach, but if the ocean is flat, paddling harder isn’t going to create a wave. A great setup in a garbage environment is still fighting a massive headwind.

This is why I use my own positions as a feedback loop.

I’ll put a toe in the water with smaller pilot positions, and if they start working, giving me cushion, and other leaders are confirming the same thing, I’ll add exposure pretty quickly.

If those first few trades keep failing, I don’t need some economist on CNBC to officially declare it “risk-off”. The market is already telling me through my P&L that I probably need to chill out.

I think the hardest part is accepting that doing nothing is still a position. Call me what you want, but this is the truth.

$$ can be ridiculously easy to make during certain stretches and incredibly difficult to keep during others, and I’ve learned the expensive way that I don’t need to prove I can make money in every environment.

Sometimes the highest EV decision I can make is protecting my financial + mental capital, building the watchlist, and waiting.

I’d much rather be bored in cash when conditions suck than exhausted and down in a -20% drawdown when the next real opportunity finally arrives.

Your own trading can tell you a LOT about the current environment.

[David @david_81889]

@NickDrendel $PARR $GCT $AFRM