Trade recap 10/11 (trade #1) -
$SPY 10/11 434p
@0.55 - for a profit of 60%
Why did I enter this trade?
- As you can see on my chart (check picture below) I marked the premarket high as $436.37. I told you in my last post that the premarket high and lows are key levels to watch.
- When market opened, we instantly rejected the premarket high on the first 5 minute candle, showing signs of sellers there.
- On the second candle, we also rejected the premarket high and the high of day created in the first 5 minutes by the first candle.
- I waited for the next retest to play puts on this. When SPY reached near premarket high (it hit 436.34) and started rejecting, I took my entry. Timestamps are posted in the Discord. You can double check.
- My first target was the break of 435.71, as this is a strong resistance level, which has now turned into support: check A1, A2, and A3 (marked on the chart) where the SPY rejected 3 times.
- Then check A4. The SPY bounced off of that same 435.71 level, so this is how I noticed that the resistance has turned into support.
- At the same time SPY rejected,
$GOOGL did the same thing, showing me that the market is weakening, as GOOGL started off very strong.
- The ultimate target on this trade was 434.53 (which we hit and are trading below right now)
Summary of the trade:
Premarket high rejected 3 times, and a strong support level broke as well. Other large cap stocks started rejecting such as
$GOOGL and
$AAPL.