The markets had a big gap up today and premarket $W was one of my top setups to short as it is up 240% in 2 weeks and gapped into some resistance areas and I reasoned
a 15-25% fade back over the next 2-5 days would not be unreasonable.
The markets could not hold the gap and faded soon after the open, bounced a little bit mid day and the faded into the close.
Unfortunately $W never broke lower, instead it traded in a “range of death” all day where it looked like it was going to break lower several times, instead ripping higher back into range. I scaled in and out several times during the day – with some size, hence the $140K loss I accumulated.
Looking back, there were many stocks in the casino, cruiseline and airline industries that had very clean fade charts intraday, I just happened to focus on the strongest one.
Below are $W and $QQQ daily and 5-minute charts where you can see the “range of death” in $W and the clean and defined ranges in $QQQ.
The lesson from this is that sometimes you just choose the wrong trading vehicle and that’s that. Need to have a short memory and move on.
Praying for another big gap up in the markets tomorrow for some new opportunity on the short side, probably something other than $W though.