Here we are, April 30, 2018 the last day of the month. First 4 months have been a blast to trade. The ups and downs and yet we are all still here! Before we start the summer trading season, you know when they tell you to "Sell in May". Let's take a look at what potentially lies ahead.
All eyes this week are on Apple earnings. Did you know that Apple (Ticker Symbol: AAPL) makes up nearly 11% of the QQQ ETF and 3.68% of the SPY ETF? I'm expecting to play it quiet today ahead of their earnings announcement after the bell on Tuesday. We have several names announcing this week and we posted a chart from Earnings Whisper in our room and you can view it below. In fact, I wrote a code for our members to add to their watchlist so they can see how many days until earnings and no more looking it up. Now of course our community of traders are always on their toes and update each other on earnings events and opportunities at hand when it comes to our favorite earnings trades. Check out this weeks earnings below and the code that all of our members received to add to their watchlist.
So what does the week have ahead? We've already seen a great report out by McDonald's that go the DOW moving and AAPL pre-earnings is moving. The $tick are calm but let me show you a few charts I posted for our members to give you an idea of where I think we're headed to.
Now that the morning session of trading is over (I only like to trade to the European close), let's take a look at where we are from the charts I posted above as well as a some trades I've taken.
Here's $400 on oil and $400 on S&P Futures. Oil trade last 7 minutes and the S&P futures trade combined was about 13 minutes. 20 minutes of trading, 3 trades, $800. You may say you hate Monday's but I love #MoneyMonday
On the S&P Futures, I had the $2665 area as support and that's where we currently sit. We break we can see $2757.
Gold chart I want the gap fill and then bounce. We filled the gap and have since bounced 6 points higher. That's $600 per contract!
Nasdaq update has lower to go and I'm target 6600 area. Possible 6575 and it's playing out as planned too.
Someone tells me, "I'm a bonds guy. Using the squeeze and Fibonacci with the bonds has been a great play today. Check out the chart and the trade off my entry".
In fact, the month of April has been great success. Look at a few of the closed trades this month. The average risk has been about $280 per trade and we're a little over $3,400 in total profit. I still have positions on in eBay, SBUX and GRMN. I will hold these over into May.
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If you missed the 3 opportunities to trade AMZN pre-earnings that has had some incredible results then you don't want to miss out on the next opportunity post earnings. Our community is killing it with these pre-earnings trades and if you want to see for yourself, then JOIN NOW! Sale ends April 30, 2018. Just look at the result from one of the traders. The beauty of the community, he shares his ideas. He's up $40k since January 1 doing earnings plays only. Before we get into the post earnings play let's take a look back at the results from some AMNZ trades that were done pre-earnings over the last year. Results don't lie. Looking at the chart above we have several bits of information for us to be able to use. The chart has information from the past 2 years. The candle that is highlighted is the day we entered on this particular trade that have returns of over 768% over the last four earnings. What does the data from the chart tell us?
Without drawing Fibonacci retracement or extensions or thinking I have some sort of proprietary post-earnings strategy that is a big trade secret, I'm simply going to look at empirical evidence on how this trade has worked successfully 8 out of the last 8 times. 50% return on investment when you combine all 8 trade totals. The setup:
This chart shows the past 2 years of data. You can see that the average 30 day move post earnings went up 6 times and down 3 times. The average move up is 10% or $148 and the average of the 3 moves down were 4.5% or $66. If we look at the current price of AMZN ($1464) and what a 20 delta is ($1330), the average move down keeps us well within our range.
![]() I did an entire members blog post on the aerospace and defense sector and what I was looking at when it comes to the charts and multiple squeezes across the biggest names in the AeroSpace and Defense sector. The same set-up happened in the financial sector in January 2018 and again recently in Oil Stocks. Look at the squeezes when on XLE and the top 10 oil names inside. Notice how most all of them have already fired long. (New members receive this custom squeeze indicator) When this is the case we like to look at those sectors ETF's and the top 10 holdings. You can choose to trade XLE, Oil Futures (we've been long since $65) or some of the top 10 names in XLE. Click to download our XLE Watchlist for Think or Swim. This has the top 10 names inside the ETF. The knowledge of our traders inside our community knows how to trade the ETF (I signaled XLE long calls) or to look at the individual names inside the ETF and which one has the best looking chart. A few names popped out and several of our traders including Devon took Valero Energy Corp (symbol:VLO). Let's take a look at the chart below. Do you see an opportunity here?What do you see when you are looking at this chart? We see an opportunity! Let's break it down a few charts at a time. ConsolidationFibonacci AnalysisThe SqueezePlan the trade. Trade the plan.From start to finish we have to plan our trade and trade our plan.
The chart setup is there so let's continue with out plan.
![]() Here is another trader that has started scaling out who purchased these calls at $1.55 and has 1 runner left. That's a 200% return if you can't read it. Another oil name, this trader is up 100%. Remind me again of the gains you're getting with penny stocks? Great trade by everyone in the room. I love this group of traders and so will you! **UPDATE April 16, 2018** We have hit the target area on this chart. See below! **UPDATE April 18, 2018** VLO hit $108. We had a trader buy his options at $40 and sell for $200. Netflix EarningsI want to throw in a quick look at NFLX before I tell you why you should join today. It's earnings season and we have had some great earnings plays in Q1. One trader was up $28k in that time. We've already jumped on Q2 earnings and it started off with Netflix. Some said to short it as it couldn't break $300. We didn't believe it because again, we saw an opportunity. In two days, Netflix went from $304 to $317. Most of us bought in on April 2. Look up the price on that day and only our members know why we bought when we did! If you missed that we bought more at $300. You do not want to miss out on this earnings season. The big names are in play and there's still time. Why you should join today?JOIN TODAY! Chat rooms are great for learning tactics. Having a chat room helped me with was the mental side of the game. Being able to talk to other traders whether as a whole or in private. When emotions get involved, we end up doing a lot of stupid things. Trading alongside Professionals everyday can help that. You’ll find people that you’ll begin to respect. You’ll see various techniques and can apply them to your trading style. You can emulate those that you like or share your style if you can make it easier for others to understand. I told our chat community yesterday that several new things are coming from a new platform to automated trading. Only those within our community will be able to get access to this first. We take care of each other in there. No egos, no one guru and we want everyone to succeed. Our motto is "TEAM WORK MAKES THE DREAM WORK". We’re going to have TONS of traders and a huuuggge, interactive group of smart traders…
AND WE WANT YOU! Here’s what you get:
I'm not a huge fan of buying options on Monday but this chart looks great on a daily, weekly and monthly chart. I'm jumping in and while we do have earnings this week, let's see if a run into earnings can boost our position. This position isn't based on earnings but can only be thought of as a plus. You can see the momentum has clearly shifted to the upside and if we can continue and clear the first hurdle of $59.50 and hold. I see a first target of $61, second target of $62 and max target of $64.50. To see how I set up this trade make sure you join our community today. The alert will be sent in our signals chat!
CLICK HERE TO JOIN Before I discuss this week's trade of the week and outlook, I want to do a quick check on Urban Outfitters, (April 1 Trade of the week). We were looking to take out $37.48 and it did. $URBN made a high of $38.70 and the daily squeeze is just now firing long. I am still in this position to the long side. On to this week outlook. I'm watching Apple $AAPL. My thoughts are as $AAPL goes so does the market. Why is that? Apple is heavily weighted in the Nasdaq ETF QQQ, the biggest holding in SPY and 15% of the Technology ETF XLK. Click the images below to see. If $AAPL breaks the Darvas box on the daily time frame at $165 we can head lower. If you look at the weekly Darvas box you'll see that $165 was resistance in a prior box and $AAPL is in a weekly squeeze. Apple current IV is 32% with and IV rank of 80%. At the current IV level we can determine what option strategy works best to play this to the downside. Want the IV Rank indicator? Just ask me in the King's Chat. We have been discussing the pre-earnings strategy with Apple and the results are shown below buying 3 various deltas. This is empirical data that has been traded and tested, not something we pulled out our butt. I promise you this too, we're not buying deep in the money, high delta positions. If we wanted to do that, we'd buy the stock but we want the benefit of buying options cheap and let implied volatility help us make the options even juicier! The actual results are posted inside our Earnings room. The goal is to get Apple at a discount this week by buying it at new lows if the $165 level breaks. What are my targets for Apple? What does that do the Nasdaq and S&P? What strategy to use based on this IV? See more in the members blog. To sign up for the members blog, CLICK HERE. Daily DarvasWeekly DarvasApple Implied VolatilityTo join our community CLICK HERE NOW!
While Ruger $RGR may not be my first choice of weapon to buy (I prefer Glock and my conceal carry of choice is my Glock 27), I have traded the stock before at technical levels but this time it wasn't as much technicals when I traded it. Is this a wise choice to do? Probably not but I felt like getting my inner Axelrod on. You know the hit show series "Billions"? Were you mad when he shorted airline, hotel and shipping stocks at 9/11? Then the next plane hit and he doubled down? *SPOILER* What about season 3 when he received the alert of an earthquake and it hurt his funds positions because of a Tsunami? Sometimes these catastrophes can cause situations in the market place that we can predict as well. Same case is with Ruger. What happens whenever innocent Americans are targeted with mass shootings? Gun stocks always go up. Without getting political, gun control always becomes a topic and seems like those who are pro-gun go out and stock up in supplies and guns. Don't believe me? Chart doesn't lie. I'm looking at the Orlando shooting, Las Vegas shooting and the Florida shooting. Orlando the price before the incident closed at $57.41. The high after the incident $63.57 Las Vegas price before the incident closed at $51.17. The high after the incident $55.13. Florida School shooting price before the incident closed at $48.75. The high after the incident $50.25. So some short term trades here but I want to look at a bigger picture and not trade off of news related events like this. Can we get a larger move? Let's dive into the technicals! My latest position was after Florida incident and it also had some technicals that I considered. Let's take a look below. We hit a 100 Fibonacci level and the red arrow shows you the day after the shooting. Now why did RGR go up but stop? That last swing high to low is a half way back (HWB) move as shown below. So sure, after the event we hit a R level. Look at other clues here. What do you notice? We hit the 100% level and bounced back to the 50%, failed back to the 100% level and back to the 50. What happens next? A case of symmetry! We fail that 50% level and create a new low to a new 100% level. Beauty. Look at those two RED daily candles followed by a GREEN candle. Is this a reversal off the 100%? Does it do a HWB move higher? If you add additional Fibonacci levels to the previous wave you'll notice they create a cluster at the new 100% level. This area should be a good area of support and looking for a longer term buy opportunity here. Plan the trade, trade the planMaybe you've heard that term before. If you haven't check this out. Contrary to popular belief this isn't something someone at some educational firm says and owns the saying to and says I can't re-create or be silenced about. It's information that a quick Google search can your friend in learning more! As we bounced off this new low at $43, we see the daily candle is green and from there we are looking to take out the previous days high before entering. You can see the red arrow that shows the candle where we entered this position on March 2, 2018. Planning the trade and trading the plan doesn't end there. What are the targets? We can see below the targets from taking the last two swing highs and running Fibonacci levels. Entry around $46.20 and our first conservative target would be the HWB move we've been seeing around $47.25 and $49.33 depending on which wave you look at. I want to focus on the Fibonacci Clusters around $49.33 - $50.82. That's my initial target. As you can see we hit this area. We took profits here but in a swing account I continued to hold. Swing for the fenceIn our chat, we took profits around this area however I continued to hold in another account and as of this post, I continue to hold. I will sell end of the day today. Let's look at what played out and one of my new favorite price action patterns that I'm looking at. The bull flat pattern below has played out. What makes this a unique pattern and how does it work? I'll discuss below but let's look at the chart. You can see our entry level above $46.20. We hit the fib clusters mentioned and had some down to sideways action setting up this bull flag. We stayed inside the tight range and broke out. How does a bull flag work? You have the initial advance of price that we found off of Fibonacci levels. We had the flag form and then we broke out higher. So to find a target using this pattern you take the first initial advance low to high and draw a trend line. Then you duplicate it and go from the lowest point before the break and start it there. You can see these YELLOW lines on the chart above and how we have hit targets based on this pattern. Now if you know me and how I trade you should know that I'm not using a flat pole I drew on a chart as an exit. I'm using Fibonacci! Remember those levels from the last swing high to low. The purple ones on a few charts ago? If we remove those and use our cheat codes we know we also have levels for additional upside targets. Let's take a look below. Here you can see the daily candle slow at the first target after the bull flag at $53.81. Then it stop twice at the next level at $55.41. Then last and at the top of our bull flag pole we hit the $56.75. So a $10 point over 1 month and you can see again, at the time of this post we are currently down after hitting the upper level. Do I take profits here or do I look to hit the larger wave high to low target at $59? I may close out today or continue to hold as I own April monthly options. I spent $350 a contract ($1,050) of risk and currently at a profit of $2,052. I've almost doubled my money and if I had sold yesterday I would have. Great trade hitting first targets and taking profit or waiting for the continuation and hitting these upside targets.
So sure a sketchy play off some horrendous acts in the US but if we throw in technicals and plan our trade and trade the plan you can do great things when trading options. Don't trade off news but learn to analyze a chart and what is it telling you? If you want to sign up for our community chat room and get these alerts you need to JOIN NOW! Let's take a look at some of the common time frames that I use when doing my analysis and why they are important to me. A few things to note. There are 6 hours and 30 minutes a day when the market is open (not including holidays where the market closes early). That 6.5 hours is 390 minutes. Also it is important to remember that on each time frame 233t or 15 minute, each time that time elapse a new candle will print. 233 ticks before a new candle forms. 15 minutes before a new candle forms. Let's discuss each below and there are some that you don't see here but I'll talk about them. Also, I will show you how to add custom time frames to your charts.
Adding Custom Time FramesTo add custom time frames go to the time frames and click customize time frames or go to you chart settings and click the Favorite Time Frames tab. It is there you can add your custom times frames by clicking Add time frame.... Couple notes: Intra day is 1 day to 360 days and Daily is 1 Month to Max Available. The tick option all you need to see is the 1 day. Hopefully this helps and if you need to learn more you can download the ThinkorSwim Manual
URBN - Urban OutfittersI'm going to start a series of trade of the week ideas. I'll post this on Sunday evenings or Monday evenings. This week I'm going to get started early and take a look at $URBN Urban Outfitters. Why $URBN? With the market failing last week, URBN really saw one day of selling. It's not caring what the market it doing. Sure it had an upgrade by Morgan Stanley and retailers are looking to post comparable growth from last quarter so $URBN is holding it's own currently. Enough with the news, what I care about is what does the charts tell us? I'm not looking at this for a short term scalp but rather on a larger time frame using the daily and weekly charts. We can see on the daily time frame we upside targets around $38 and retraced half way back to $34.75. To get long in this position I am looking for two things to happen. 1) Take out the prior days high ($37.48) or 2) take out the last swings high ($37.99). Ideally somewhere in between is the 78.6 retracement around $37.50. If we can clear and hold this level. I can see upside targets of $39. You're telling me a $1.50 is it? Not at all. Ideally, I'd like to see this continue to make higher highs and higher lows and the upside target I'm shooting for long term is between $46 - $47.50. Here is the weekly chart. I'm setting this up with April and May calls if the levels I mentioned above happens. Signal will be posted in the chat room when the trade is taken.
I'll be out on vacation this week so trading will be light. I have alerts set-up on any new potential trades and will manage my current positions while my toes are in the sand! Everyone enjoy their week and happy trading! -FibKing |
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