Traders,
I’m excited to share my top swing trading ideas for the week ahead. I will detail my exact trade plans for stocks presenting favorable risk: reward opportunities and likely to make significant directional moves. And stick around until the end as I share a key lesson.
So, without further ado, let’s get right into it.
At the end of the first quarter, I noticed momentum breakout setups in big-cap tech names lacked follow-through. This occurred as capital and performance began to gain momentum in more defensive sectors. Sectors like financials, utilities, and industrials have been on a tear lately, which interests me. It shows me that risk might be coming off, and I must make the necessary adjustments.
So, you’ll notice my swing ideas for the week ahead significantly differ from my ideas and setups from last week.
MSTR Lower High Continuation Short
MSTR was hit on Thursday with the short report and finally displayed immense relative weakness to the underlying Bitcoin. This was a huge change of character for the stock, which had previously traded at a massive premium to Bitcoin.
After Friday’s character change and weak close, I am looking for a lower high / bounce to short for a one- to two-day continuation.
*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.
Here’s my plan:
I am looking for the stock to push toward the developing VWAP from day 1 of the selloff, so around $1750 – $1800, and fail on the 5-min chart, thereby confirming a level to short against. After that, I plan to be short versus that pivot high, targeting a move toward Thursday’s low, where I will cover up to half of the position.
From there, I will trail the stop conservatively, on the 5-minute timeframe, using lower highs or an intraday vwap reclaim. The lofty target for the full-day or 2-day position is a move toward $1550 – $1500.
DJT: Push Back into Supply Zone to Short
The stock failed multiple times last week as it pushed into $70. Therefore, without a strong bias, I will just look to react if DJT continues to trade with overhead pressure and maintains this short-term developing bearish trend.
*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.
It’s a reactive idea. Here’s my plan:
From Tuesday to Thursday, the stock had issues in the $70s, failing each day and confirming lower highs. Therefore, I am looking for the stock to make a lower high around $67 – $69 and fail intraday – that will be my signal to enter. I do not want to see the stock take out Thursday’s high. If it does, the trend is broken in the short term.
So, if the stock makes a lower high on the 15-minute timeframe near that supply zone, I will get short with a stop above it. My first target will be a move toward $63, a support zone. After trailing my stop on the 15-minute timeframe using lower highs, I will target a move of $60 and then $55, scaling out along the way on intraday lower lows. My hold period for this position will be up to three days.
A Key Takeaway I’d Like to Share With You:
As momentum shifts and what worked over the last several months loses its edge, traders might fail to adjust and continue to trade what might be a losing strategy in the short term.
If capital flows out of growth, we continue to see sideways action in market-leading names, and high-flyers begin to pull back, then the opportunity set will be different. Different playbooks will be applicable and rewarded. What previously worked will no longer work. Therefore, it’s important to react to the price action you are seeing and make adjustments in real-time rather than after the fact.