Dear traders
We look forward to sharing next week’s top ideas. As always, I will share my thought process, trading plan, and exact entry and exit goals for ideas that I think can change the direction in significant ways.
Before delving into new ideas, I would like to reiterate the importance of adapting to evolving market conditions. Market dynamics are changing and strategies that were effective in the past may not yield the same results. Last week, those who made the necessary adjustments were given new opportunities. It is important to recognize this change, identify what is no longer effective, and adopt strategies that are appropriate for the current market environment.
For example, instead of focusing on the breakout of TSM, which looked strong on a daily basis last week, I focused on shorting DJT and MSTR. You can see the results by looking back at the chart. It’s risk-off in the short term. Gold, commodities and energy stocks are surging, and we’ve seen some upside from growth stocks over the past week.
Continuing with last week’s ideas and tweaks, here are my top ideas for the week ahead.
ACB short: Push to supply zone
On Friday, ACB had a perfect entry when it failed to push into the opening two-day VWAP, and after topping out on Thursday, it provided a nice short entry to the day’s highs. Unless there is news about the sector, it may take some time for stock prices to stabilize, and then they may rise or fall gradually.
But one scenario I’m planning on is repeating Friday’s actions.
*Please note that prices and other statistics on this page are hypothetical and do not reflect the impact of specific market factors such as liquidity, slippage, fees, etc.
My plan is:
I am expecting a quick rally into the potential supply zone between $7 and $7.50, and a repeat of Friday’s move could fail. If this move is confirmed, I would like to go short against the high of the day and cover half of my position from $6.5 to $6.3. After that, I intend to track the position on a 15 minute time frame using the lower highs and hold this for up to 3 days if it dips a bit.
IBIT / Bitcoin Breakout
IBIT/Bitcoin is undergoing consolidation ahead of the halving event. Of course, this event is now highly anticipated and everyone expects the same thing to happen, so who knows how likely it will be to be a news-selling event.
I like how the stock has stabilized with clear support and resistance lines across multiple time frames ahead of an important event. This is a textbook breakout setup for the entire asset class. So momentum breakouts in growth stocks are no longer in play, but this may be an exception.
*Please note that prices and other statistics on this page are hypothetical and do not reflect the impact of specific market factors such as liquidity, slippage, fees, etc.
Here’s the plan:
If Bitcoin consolidation continues, action could be taken within weeks. My plan is to see further consolidation and range expansion, a rubber band effect, and price and volume expansion beyond $40. That would be my cue for a long entry, stopping that day’s low for several days and up to a week’s worth of swing positions.
My first goal on such a breakout is to move to the previous ATH around $42 to take out about a third of the position. You then plan to track the stop on the hourly timeframe using higher lows and slowly scale out of the position as it shows higher highs.
Two additional ideas:
MDIA and CADL were both great short side opportunities for me on Friday. However, with caution, there is a clear level at which to trade for a wider time frame trade, so consider re-entering with broader stops and targets.
*Please note that prices and other statistics on this page are hypothetical and do not reflect the impact of specific market factors such as liquidity, slippage, fees, etc.
Of course, MDIA has a small float, but it also has a large overhead resistance. Therefore, if that move fails, I will be looking to go short on a push from $4.5 to $5.5. I go short against the high of the day and wait for it to go back down to $3.
*Please note that prices and other statistics on this page are hypothetical and do not reflect the impact of specific market factors such as liquidity, slippage, fees, etc.
CADL, we don’t want this to be integrated into a multi-day VWAP. Instead, I would like to see it push back to $8 and fail. I would short the high of the day and target a rise to $5.
important disclosure