Tuesday, May 13, 2014

A Bunch of Trade Reviews - $UBNT $GMCR $RAX

The scope of this post is relatively simple. I just wanted to share / review a couple of recent trades I made (all on an intraday basis). So let's get started:

First one up, UBNT. I was fortunate enough to have one of my best day's in this stock after fortuitously getting hit on my offer above $36 right on the open, and I managed to capture an average of $4 on the downside. Again, I'm not here to gloat, but I instead want just want to walk through why I was thinking short and where I was looking to potentially cover intraday. The chart below is a daily chart of UBNT showing what was once support became resistance (where I was looking to short on the open on a potential quick opening "pop") around $36-$36.50.
UBNT, daily chart











While the stock was gaping down, I wanted to wait for it to start trending before I committed real risk to the trade. So shorting into the quick pop on the open above $36 put me in a position of strength to then add if the stock decided to begin trending down. The next longer-term support area I was watching was $30-$31; in my mind, the closer the stock came within to zone, the less favorable the risk/reward became on the short side. Below is a chart of my trade management on 5/9/14:
UBNT, intraday 5min chart

Notice that I made 2 distinct trades: the first trade was the short into $36 and covering the majority of the position once 4 points in-the-money. The next distinct trade I made (again on the short side) was re-shorting the stock after seeing it fail at VWAP. This second trade was relatively simple in my mind. I was shorting into VWAP with a stop above it for a Low-of-the-Day Trade (looking for the stock to test or make a new intraday low). Again, I just wanted to emphasis that both of these short trades in UBNT were distinct in their reasoning and trade management

Ok, now for the second trade review: GMCR. The stock was gaping up today (5/13/14). I didn't play the stock early in the morning, as I was busy trading RAX (discussed later). I decided to get long GMCR in the late afternoon after it had pulled back to its early morning support. VWAP was nearby the support level, so I felt comfortable in knowing where I was wrong. I was looking for a new highs, but I was stopped out for a loss. It happens! Let's move on.
GMCR, intraday 5min chart

Last one up is RAX. RAX was gaping up into what I viewed to be potential resistance. Similar to the UBNT trade, I thought if I could initiate a short on a quick opening pop, I'd be in a position of strength for what I thought could be a multi-point down move. This is commensurate with the so-called theme I've been seeing lately on a short-term basis, aka HIT THE BIDS. Below is a daily chart of RAX highlighting this resistance zone (previous support):
RAX, daily chart

After the stock put in an opening pivot high near my resistance "zone" I threw out & was filled on my $31.37 offer (I was risking 25 cents). Sellers then began to assert themselves at $31 on the tape. I tried adding to my position with a stop above VWAP, which was close by. I was stopped out of my extra shares on the first attempt, but the second time around ended up working.

Below is a 5min chart delineating my trade management:
RAX, intraday 5min chart
Let me know if you have any questions or comments.

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