10/6/20 - 10/7/20
Daily P/L: $375
Account Net Value: $803
Account Net ROI: 129%
Trade Rating: GOOD
These two days were great days for my little account. On both days I waited for a high probability set up, and executed as soon as price moved in according to my plan.
In this blog post, I'm going to go ahead and cover my trade on 10/7/20, which was a NFLX scalp. I made most of my return on this day, and it was a very clear play.
So, here we go!
The first thing I like to do every morning for the stocks in my playbook/on watch is to set the pre-market key levels. NFLX was trending on this day as it had an analyst upgrade and great pre-market momentum. So, looking at the pre-market movement, you can see that I set the pre-market HIGH level, which is also known as High of the Day (HOD), in green. This is the level I would play NFLX on the upside. Meaning, if NFLX were to break above my green HOD level, I would play calls on NFLX. On this day, I was not comfortable playing NFLX on the downside, so I did not even set my pre-market LOW level.
The market opens and I watch as NFLX takes a small sell off, however, it holds above a certain level. And for the next 2 candles, we watch as NFLX still holds above this exact level. This shows aggressive buyers holding this level, and this gives me a form of confirmation that NFLX wants to continue it's momentum run. So, knowing I want to play the HOD break, I still need to set my Mental Stop Loss. This is where I would take my losses if my trade goes against my analysis. I set my mental stop loss at the level that buyers seemed to hold well at market open. This level is set in red.
NFLX then breaks my HOD level and volume starts coming in strong, this confirms my trade and I immediately get into my trade by buying an option call.
I then exit my trade just 2 minutes after. I had set an intra-day level that NFLX previously had a hard time holding above. I used this level as a profit taking target, because I am scalping. Meaning, I get into and out of my trades on the first signal. Also, since this trade was a big trade in comparison to my account size I was not in the position to take any risks.
$225, 47% return in just 2 minutes!
Gotta love options.