YUM -> 1.87% short float, 99c earnings beats by 2c
Was watching this one pre-market and it rallied off of after hours highs above 29.00. My 1st target of 29.60 was touched pre-market and held with some level 2 orders to punch out at 29.52. On the open it shot up to my targets 2/3 areas and struggled at 71.60. I got out when it failed here and finished off at 71.40 for an unexpectedly large scalp off the open. I discussed these levels in my prep from the Oct 9 post. Chart below is daily bars but taken one minute into Oct 10 day.
After open pop there was selling off of the 71.40 level. I was still bullish and wanted to get long off retrace to 69.60 after seeing buying up near that level with volume.
Decided that I would stay bull biased and long off retrace once we crossed over my 71.40 level. My mistake here was taking too much risk on a light volume retrace. I entered 71.65 and risked 15c and was stopped out at 71.39. I was stubborn and took another poor trade when we supported at very low volume below there at 71.35 and entered at 71.39, and was stopped again at 71.34. Minimum risk on these trades but once was enough ... no reason to go back for seconds. After this I decided to stay away from YUM unless we tested 69.60 again and there was bid strength on the tape at that level. Gave back some money on these trades but risk was kept small so not the end of the world.
COST -> 1.20% short float, up above 103.50 all time highs, earnings 139c beats by 8c
Pretty straight forward here. I wanted in above the recent all time highs at 103.50. It gave the opportunity with a clear stop below the wicks at 103.40. Got long with 15c risk.
There seems to be a new high made before proit taking occurs. First time was with repeated selling at 104.10. Later it came with escalating volume dumps driving down to 103.80. Once that finished it appears to slowly be chopping upward again. I feel like there might be some larger scale profit taking throughout the day and am interested to see if new highs bring some other form of downward correction yet again. If so then I may add risk at the bottom of that correction, or once the sellers drop off. I am not impressed by the lack of comitted buying interest and was contemplating a stop below 103.80 to lock in a bit of profit, but I am learning my lesson from BIDU yesterday. I will stick with my original plan as there is really no reason to be bearish on the longer time frame.
Stopped out of my original entry. My plan here was fine and I am happy that I held. the problem with this trade was that I had the opportunity to add a second tier or risk right from my original entry point and I did not. The problem when trading with one lot is that it is all or nothing. Generally I only trade one lot on the lightest risk scenarios or scalps, but here we were consolidating above all time highs with a clear stop level. I definitely need to use the appropriate risk, as here I would have likely sold the first tier once the seller stepped in at 104.10 for a 55c profit. The second tier would have been the long term hold that I would have been glad to give back 15c on. I have not been trading too long but I have noticed position sizing is a huge deal and the layering of risk based on the situation is what helps consistent profit. Probably my last trade for today. Got a nice lucky spike on the open in YUM to get some nice profits but making some mental errors since then. Will sleep and update charts and tomorrows targets later this evening.
Preview for Oct 11
Looking at a second day play in YUM for tomorrow. Today was a very obvious pivot point at 71.00. There was a range battle between 71 and 71.50 with the bears holding and then driving the price below 71 briefly. It was bought up into the close and holding 71 early tomorrow is bullish. Will long strength here and remove risk at 71.50 and 72 should we make it up there. A break above 72 is very bullish and should likely see uptrend continue towards big resistance in 73.80s.
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