Daily Plan 10.19.23
Good evening, readers!
Before delving into the trading plan, I've received inquiries about the execution models employed for both long and short positions. I'll address this query after providing a recap of the session, and this detailed information will be exclusively available to our valued paid subscribers. While the comprehensive discussion on this topic will be reserved for a larger post, I will share some general insights.
It's important to note that various factors influence the execution process, and it can vary significantly from one trader to another, even when following the same plan. Now, let's move on to the session recap and subsequently cover the execution strategies.
Here's what was discussed in today's plan, which serves as an extension of my thoughts from the previous session—a session that unfolded according to expectations.
As mentioned yesterday, the range between 4410 and 4422 holds significant importance, and it's crucial to stay below this range. With the closing price just slightly below, I'll be adhering to the same thesis, as I anticipate more volume entering the market at the Low Volume Node (LVN). You can find the entirety of yesterday's post, including this section, quoted at the top of this post for your convenience. There have been no changes, and my bearish outlook persists as long as we remain below this crucial Point of Control (POC).
Regarding my Nasdaq levels, I will be adjusting them lower, except for the long level, which will remain unchanged. The downside targets will remain the same, as will the upside targets. As we move higher, we can expect shorts to be squeezed, contributing to half of the buying activity, which will be met by other traders taking long positions. If the shorts (sellers) are the ones holding us down below the POC, one can only wonder what will happen when we break through those price levels to the upside - Short Squeeze.
The Emini and Nasdaq both successfully reached their short targets. I provided an update on the Nasdaq, adjusting my short target from 15113 down to 15000, and this update proved to be exceptionally beneficial. We witnessed an impressive 150-point decline in the Nasdaq, surpassing my 15000 target and extending further. In the case of Gold, it experienced a significant rally, surpassing my long target and delivering more than 30 points in gains. Oil also made a noteworthy move to the upside this morning, hitting my long target, which coincidentally marked the high of the day (HOD).
The tech swing trades that I've been closely monitoring continued to perform well in this session. NVDA, in particular, was a standout, reaching 420 for another 80 points of downside movement since I shifted to a bearish stance at its peak. What's remarkable about this trade is that it boasts 80 points of Maximum Favorable Excursion (MFE) with no Maximum Adverse Excursion (MAE), consistently generating profits day after day.
Within my daily plan section, all eight stocks saw robust selling activity, dropping below the short levels I had identified. This not only boosted put prices but also presented ample opportunities across various segments of the market. These results align closely with the thesis and levels I shared the previous night.
Regarding earnings reports released after the close today, the outcomes were mixed. Tesla met my earnings target at 232, but unfortunately, NFLX and LRCX did not work out in our favor.
TSLA: Bearish - Target 232
Now it’s time to jump into the execution side of the systems I use.