Daily Plan v2146.3
11/10/21
Traders:
A quick look at what we expected for the session and how the day turned out to be.
A) Recap:
Primary expectation from trade plan was that if we opened above 4690, I wanted to see 4710 taken out on strong volume quite early on in the session. See Figure A below for hypothesis 1 and hypothesis 2.
We opened above 4690 at 4699. However we quickly sold down to below 4690. There were 2 very early indicators of potential softness which I described earlier:
We opened at 4699 but did almost no trading above 4699
I usually start around 8 , half an hour pre open and start watching the tape for any thing unusual. About 3 minutes before OPEN, I noticed the spreads widening to about two ticks. This is almost always a sign of lack of demand at the highs.
This observation was followed by lack of horsepower very close to the open when I sent this follow up: Early AM Lack of Horsepower
However, early on in the session I expected the 4689 level to hold as it had quite a few sellers stuck from yesterday. 4689 gave way very rapidly to trade 4685.
At 4685, I sent this tweet below: Tic Toc 4685. At this point it was evident to me the sellers were in control. Within minutes, we traded down to 4670, made an attempt to take out 4660, failed and spent the rest of the day near the lows. 4685 capped rallies all day.
Let’s see how our EPS plays did:
PYPL: I was bearish re: PYPL earnings yesterday at ~ 226 and my target was 198-200. We closed at 200 on the day. It’s close to my levels but I need confirmation.
RBLX: A big winner for me. I gave this at 80 bucks and it is up ~ 40% post EPS, now trading 110. I think this goes higher.
SAVA: I expected this stock to do well after earnings at 90 bucks. However this closed down at 76 dollars.
BITF: This stock was given at 8 bucks yesterday and just closed at 9 dollars. I think this may trade higher.
PLTR: I was bearish on this stock going into the earnings at 27. It is now trading 24 bucks. I think this could retest 22-23 handles before the next major move.
TSLA: I sent several warnings re: the stock being quite overextended at 1235. Today it released some steam. Now 1024. I think as long as we stay below 1064, a test of 880-933 may be possible.
B) Contextual Market information:
In this section I lay out the information I gleaned from the day’s market action which help me string together a few price scenarios for tomorrow.
Primarily, this was the third day in a row that we closed below 4696. This level was given by me last week and I indicated this may play a key role this week. 4696 Telegram.
There was heavy volume at the lows between 4669-4675. Notably this is a strong support area from the previous week.
TLT et al now trading above 150. I believe TLT above 150 may be negative equities.
My order-flow pivot is 4680 which is ~ Value Area High (VAH) from today . See below link for VAH definition: What is VAH
Scenario 1: An OPEN at or below 4680 may be a continuation of today’s session with an attempt made to take out the Low of DAY (LOD) at 4663. If successful, the next logical target may be the start of repair work from FOMC at 4635.
Scenario 2: If however we open above 4680, or BID above 4680 during the course of the session tomorrow, we may want to test what is out there at 4692-4696.
If Scenario 2 plays out, I will think that the widened spreads this AM were just temporary , not a sign of major softness in days to come. If we do not test 4696 tomorrow, I will think the softness may last for a few more sessions.
At the time of this publication, we just bid 4672.
So that is a wrap up. I did not see any major earnings cross my radar for tomorrow. At any rate, I want the general market to firm up before venturing into individual stock tickers.
Let me know what you think. Feel free to share.
Disclaimer: This newsletter is not trading or investment advice, but for general informational purposes only. This newsletter represents my personal opinions which I am sharing publicly as my personal blog. Futures, stocks, bonds trading of any kind involves a lot of risk. You may lose everything you have. So be very careful. I guarantee no profit whatsoever, You assume the entire cost and risk of any trading or investing activities you choose to undertake. You are solely responsible for making your own investment decisions. Owners/authors of this newsletter, its representatives, its principals, its moderators and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission, CFTC or with any other securities/regulatory authority. Consult with a registered investment advisor, broker-dealer, and/or financial advisor. Reading and using this newsletter or any of my publications, you are agreeing to these terms.
btw I love your date convention…
what about rivian ipo ---- do you think it helps as amazon has a good stake in it?