Today marked the start of my third week in the Trading the Post Room. Finally the firehose of information has turned into a residential power washer. Terms I was not as familiar with (AVWAP and scalping) have become less foreign to me.
I did my due diligence over the weekend on Visa ($V) and determined price targets that would be tested depending on the stock’s behavior. After placing a swing trade (227.5 Sep17 Call), I asked a fellow chat room member, Nico (@nico), for his opinion on my trade and the setup.
Analysis and Preparation
After a quick glance at the trade’s timeframe, the daily chart, we both realized a level of resistance being tested for the third time within the day on the 3-min chart. Nico flipped back to daily candles and quickly found evidence for a level of resistance at 228. The resistance was easy to identify as seen on the touch points see below.
$V Resistance Level at 228
While we observed the price “getting rejected” and fading back, we then added a fibonacci retracement on the range of that current day, see below.
Adding a Fibonacci retracement from the LOD to HOD
By the time we identified the behavior, $V had given us exactly the move our technical analysis would support. From here, we now saw $V making lower lows. We added an AVWAP (Anchored Volume-Weighted Average Price) on the recent high, 228, and opening candle, see below. In TTP, we use the AVWAP to help us establish a line, where in this case, downside movement, we want to see if the price stays below or breaks back up and through.
$V AVWAPs
We followed the layering approach that Ron explained so clearly just a few days ago before in this trade breakdown of $NFLX.
Entering the trade
Then we looked for the next level to enter, the 0.5 fib line, and also established an exit level, the 0.382 fib line. Next we shorted 100 shares common and saw the move unfold within minutes.
$V Entry and ExitIt’s Beginning to Click
Over the past two weeks I have been fortunate enough to be able to immerse myself in the TTP course material, the weekly webinars and the ongoing dialogue with other traders. Having a community within the Trading the Post Room that shares a common understanding offers new traders, who are willing to learn, the perfect environment to pick up and implement new learning, not just in theory, but in practice. This has been an exciting, humbling, and evolving experience for me.
Ronchero genuinely wants to see TTP members improve their trading skills and constantly provides feedbacks to those who share their experiences!
Ronchero Constantly Interacts in the Chatroom