Trade Plan for Spotify (
SPOT
)
Reasons for the Trade:
Positive earnings report.
Strong consumer sentiment.
Formation of a Bullish PEG candle.
Notable sell-off in alignment with the broader market.
The stock's performance offers potential for both long and short opportunities.
Price retracement to the critical level of 159.50 (or rounded 160). A substantial deviation from this point is a bearish indicator.
Long Setup:
Entry: Look for a bullish movement away from the 159.50 mark, supported by 15-min bullish volume and candlestick patterns.
Key Level to Watch: A break above 165.30, which corresponds to the AVWAP from the earnings announcement.
Stop Loss: Set at 157.66.
Profit Targets:
First target at 165.29 (scale out 50%).
Second target at 167.75.
Risk Management: After hitting 165.29, move the stop loss above entry for a breakeven scenario.
Risk Allocation: 0.50% of the portfolio.
Short Setup:
Entry: Anticipate a bearish price action that breaks below the 159.49 mark.
Entry Confirmation: Rely on price action combined with volume metrics.
Stop Loss: Set at the 162 pivot.
Profit Targets:
First target at 155 (scale out 50%).
Second target at 150.
Risk Management: After achieving the 155 target, adjust the stop loss to breakeven. Ensure there's significant volume during the break of 155 to anticipate a continued downtrend.
Risk Allocation: 1% of the portfolio, given the prevalent bearish sentiment in the broader market.
SPOT
) Reasons for the Trade:
Positive earnings report.
Strong consumer sentiment.
Formation of a Bullish PEG candle.
Notable sell-off in alignment with the broader market.
The stock's performance offers potential for both long and short opportunities.
Price retracement to the critical level of 159.50 (or rounded 160). A substantial deviation from this point is a bearish indicator.
Long Setup:
Entry: Look for a bullish movement away from the 159.50 mark, supported by 15-min bullish volume and candlestick patterns.
Key Level to Watch: A break above 165.30, which corresponds to the AVWAP from the earnings announcement.
Stop Loss: Set at 157.66.
Profit Targets:
First target at 165.29 (scale out 50%).
Second target at 167.75.
Risk Management: After hitting 165.29, move the stop loss above entry for a breakeven scenario.
Risk Allocation: 0.50% of the portfolio.
Short Setup:
Entry: Anticipate a bearish price action that breaks below the 159.49 mark.
Entry Confirmation: Rely on price action combined with volume metrics.
Stop Loss: Set at the 162 pivot.
Profit Targets:
First target at 155 (scale out 50%).
Second target at 150.
Risk Management: After achieving the 155 target, adjust the stop loss to breakeven. Ensure there's significant volume during the break of 155 to anticipate a continued downtrend.
Risk Allocation: 1% of the portfolio, given the prevalent bearish sentiment in the broader market.