Day Trading Lesson – We Will Not Short INTU Today – Here Is Why

August 24, 2016
Author: Peter Stolcers, Founder of OneOption

Posted 9:30 AM ET - The market is as flat as a pancake. There isn't any news to drive the action and daily trading ranges are tiny. We can expect this to continue through Labor Day. Since my comments haven't changed much, I thought I would post a lesson that I would normally reserve for chat room members. We are constantly evaluating earnings trades and here is one that we will avoid today. Intuit is going to get pounded on the open. It will fall below the 100-day moving average and it will trade below horizontal support at $109. . . image . . I have a study that shows price behavior the day after earnings announcements and you can see that the stock has a tendency to gap and retrace after big moves. A bounce would put it back above the 100-day moving average and above horizontal support. Consequently, this is not going to be a short we pursue. In a lackluster market it is not worth the risk. Trading is about probability and about stacking the odds in your favor. We have many studies we use to increase our odds of success. . . image . . We will look for longs to trade in the chat room today. The SPY is above support at $217.50 so we will favor that side. Be patient and trim your trade count. I have cut my size in half and I'm just looking for a couple of good trades today. My targets are passive. The action will pick up after Labor Day.

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