merchants,
What an eventful week that confirmed the adjustments I’ve talked about before and used to be right on the money. I will elaborate on this and share my top ideas for next week, focusing on my precise trading plans for setups that can make significant directional moves.
However, before I share my top ideas. Let’s briefly recap last week’s action and watchlist ideas. I focused mostly on the short side which paid off last week, with exceptions in more defensive, in-game areas like the energy sector. The ACB and CADL short ideas worked perfectly, and I urge you to go back and study them as they are a short opportunity for the back of the textbook. Unfortunately, IBIT opened the gap against resistance to start the week, canceling my plan, so no trade there. Two other swing trades I made on the week were long TPET from the lows of $0.20 and sold near $0.50 on Friday, along with a long on OXY from the lows of $69 and sold near $71 on Friday, both Out of topic. rising oil prices and tensions in the Middle East.
As we look ahead, it is important to recognize current market conditions. After the major sell-off across the board on Friday, I’m approaching this week with caution. Currently, I have no ideas for an A+ swing. We could possibly see a continuation of the downside or some digestion and consolidation. It is important to be prepared for any scenario and to be informed of the evolving situation in the Middle East.
Many sectors have started to pull back significantly on a higher time frame and the leading sector, QQQs, continues to consolidate. This week, I’ll avoid looking for big breakouts and instead focus on individual names and subject scenarios.
Oil reservoirs with a small cap are heated
Several small-cap oil names rose on Friday. I closed my long position in TPET after it doubled on Friday. Going forward, I’ll be watching a handful of small-cap names for possible consolidation, further upside, and potential compression as fear grows of rising tensions between Israel and Iran.
Eventually, I’ll watch them for a swing short, but until we get to lower highs and confirm the backside, I’m open to a developing and playing theme.
Here is my plan:
*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 fees.
If TPT continues to consolidate above the multi-day VWAP and the $0.40 – $0.45 range, a liquidity trap / short squeeze scenario could see this squeeze closer to $1. In this case, I would look for another long entry targeting an intraday breakout with a stop at the low of the range, following my position on the 5 minute time frame and looking for a breakout to $1+.
Alternatively, if tensions subside and energy continues to pull in, I look for a rally to possible resistance near $0.60 to fail and confirm a lower high for a 2-day swing short, targeting a move back towards $0.30 .
*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 fees.
INDO and HUSA: Two additional small-cap oil stocks that saw some volume were released on Friday. Similar to the pattern above, if INDO, for example, shows signs of holding strength and a broader theme develops, I should see it trap and consolidate above $5. This would make me interested in a full day – 2 day position for a move first above Friday’s high, and then to exit the long position as new intraday highs are made on the 5 minute time frame, scaling since it is largely extended by the VWAP.
On the other hand, if the names blow and the theme doesn’t develop, I’d look for a push above $5 to fail and the intraday VWAP to fail to hold, thus looking for a short against the previous high and a swing short targeting a move back into the $3s.
Additional Backburner Notifications and Idea:
Come in NXPL: Had a clear all-day fade on Friday, and there’s a lot of overhead resistance now. I would place resistance push alerts near $2 – $2.30 for an intraday breakout and short for an all-day swing.
*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 fees.
Important Disclosures
