Traders, Happy Sunday!
I hope you’ve all had a restful and enjoyable weekend! Quick side note: I will be traveling and working part-time remotely from next weekend until the end of the month, so expect shorter trade plans until I return!
If you missed the breaking news and developments about the potential government shutdown this weekend, there will not be a government shutdown. President Biden signed a temporary funding bill to keep the agencies open after Congress rushed to approve the bipartisan deal.
Last week, I discussed a few points and concepts before getting into my trading plans. And this week, I want to continue where I left off. After the market sold off amidst comments from the FED, and we saw the range and volatility expand, I expected a less eventful week, which we got last week.
SPY was down less than 1% last week as its range significantly contracted compared to the prior week. With that, so did the opportunity, specifically for directional swing trades. That’s why I emphasized that managing expectations is vital. By doing so, I did not force any swing trades. I was prepared for a slower week. So, I shifted my focus to intraday, move2move style trades, as the swing ideas did not materialize.
When swing plans don’t materialize, and I don’t have an edge, I focus on my other skillsets – intraday trading – or I don’t trade. It’s about knowing when to press and when to take your foot off the gas and switch gears.
For example, I had a detailed swing trade plan for META last week. While the swing opportunity did not materialize, by having it on watch, I was able to take notice of the price action and key levels leading up to its Connect event on Wednesday. As a result of being open-minded and managing expectations, I was able to capitalize on a momentum short trade below $300 on Wednesday and a momentum long trade above $300 on Thursday.
So, with that being said, and keeping those key lessons and concepts in mind for the upcoming week too, let’s get into some fresh swing ideas.
Advanced Micro Devices (NASDAQ: AMD)
While AMD has featured multiple times on my watchlist, it has yet to trigger. Typically, I will remove the idea, but seeing as though the idea hasn’t been triggered yet, I am led to believe that this idea will take longer to set up than I originally thought.
With that being said, going forward, I will have alerts set. I will not be watching this every day. I will just have alerts set at key levels.
*Please note that the prices and other statistics on this page are hypothetical, and do not reflect the impact, if any, of certain market factors such as liquidity, slippage and commissions.
I like how the stock broke down, touched the 200-day SMA, and quickly reclaimed the bullish higher time frame consolidation. That’s why I will watch AMD again going forward for a potential long trade if the stock can break above its consolidation resistance and hold firmly.
So, in the coming days or weeks, if AMD can break above its resistance, now near $107, and subject to change as time advances, I will look for the stock to successfully base above the level, thereby turning it into support.
Once that is convincingly confirmed by way of a higher low or substantial volume, I will go long with my stop placed below the most recent higher low or below the breakout level if the stock consolidated above it.
My target for this position would be $120, a level the stock previously failed from with near-record volume when it previously reported earnings. My timeframe here will be slightly longer than typical, with a 2-week timeframe for it to work as long as I do not stop out.
Novo Integrated Sciences (NASDAQ: NVOS)
This is similar to my previous idea several weeks ago in TTOO, where I looked for a lower high pop in order to get short for a 3-day swing trade.
Like TTOO, NVOS is a small-cap stock with a nearly $47 million market cap, and its float is around 140 million, which will, of course, change after the reverse split.
After popping up late last week to around $0.50, the stock gave back most of the gains and closed the week under $0.30. Interestingly, there appears to be a small cult following building aiming to squeeze the shorts.
*Please note that the prices and other statistics on this page are hypothetical, and do not reflect the impact, if any, of certain market factors such as liquidity, slippage and commissions.
However, based on the price action and recent news and developments, which I urge you to read up on, I am looking for a push back into a potential supply zone to get short for a multi-day short position.
Specifically, I am looking for the stock to push back into $0.40 – $0.50 and put in a lower high on the hourly timeframe. Once that has been confirmed, I will look to go short versus the high of the lower high. I am on holding this for a maximum of three days, but most likely two days, and targeting a move toward $0.25 – $0.30.
While the $ range might not appear significant, the % move certainly is. The liquidity allows me to size comfortably whilst risking a predetermined amount and achieving a minimum of 3:1 R: R if the trade materializes.
