Finding consistently profitable trades is hard due to the fact that most are volatile. Trading presents most traders with the challenge of lacking identification of top opportunities and effective entry and exit strategies needed to maximize returns.
These six stocks come in every week, with a clear entry and exit strategy for peak potential. Using technical analysis, volume metrics, and historical patterns of study, we find the best trading ideas for the upcoming week.
This trade plan proffers strategic insights and step-by-step plans for each stock that helps traders navigate the market more clearly with defined setups and potential outcomes.
1. DJT (Dow Jones Transportation Average)
Overview: DJT has provided many opportunities the past few weeks. Following significant moves, the stock has printed high-volume situations that were more than suitable to take advantage of.
Entry Strategy: DJT will be hand’s off unless we see a move to key resistance or support levels. Key resistance in the 35-40 region presents a major supply area that could be a perfect short setup. Conversely, a quick drop into the low 20s would represent a relief bounce setup.
Exit Strategy: If shorted around the 35-40 area, look for tighter stops and reduction of positions on any reversal signals near prior resistance levels. Consider a complete exit of a long position in the 20s with volume verification and scaling out gradually as DJT approaches resistance.
2. XBI (S&P Biotech ETF)
Overview: XBI has shown positive momentum, breaking above the significant resistance of 102. Newly found support could set up for a potential long swing trade as buyers now take control.
Entry Strategy: For a long, look for XBI to break into its 103-103.50 range and then for a higher low pattern following that. Now enter on confirmation of a bounce back through the multi-day VWAP with a tight stop placed at 102 to avoid risk of breakdown.
Exit Strategy: Trail stops on prior day lows. Take profits incrementally as XBI blows through its daily ATR (Average True Range) levels. Maintain a tight stop if it once again comes back into the prior range below 102.
3. TSLA
Tesla has gone up very quickly, and that can leave the door open for a short-term look at reversion. With still high bullish momentum, though, the risk/reward for this type of further upside is limited in the near term.
Entry Strategy: For signs of a first red day where Tesla opens red and fails to reclaim green. Look to short near VWAP failure or consolidation breakdown.
Exit Strategy: To exit with an ATR down move or if Tesla reclaims VWAP within the intraday session. Targeting a quick reversion trade instead of a swing allows for capturing short-term movement without being exposed to higher risk.
4. PLTR (Palantir)
Overview: Like Tesla, Palantir has been trending upward and, thus is due for a pullback. Despite the long-term sentiment being positive, the strong stretch may create a reason for a short-term reversal.
Entry Strategy: Like the Tesla position, wait for signs that an intraday turn is developing. A short entry could be at a failure at VWAP or from a failed green-to-red move.
Exit Target: The ATR down move or the reclaim of the VWAP is an exit target. Because this is stretched, keep that in mind with respect to risk and should momentum begin to show improvement, use this as an opportunity to exit.
5. FOXO (Foxo Technologies)
Big Picture: Impressive volume on FOXO but unfortunately, this has played out in failures for follow-through. Considering recent price action, it’s likely either a re-test of the support or a breakout setup.
Entry Strategy: Short off a failed rally above $0.80 or $0.90 for reversal, or if FOXO breaks $0.90 with volume, for a breakout means a long set up with stops at $0.80.
Exit Strategy: On shorts, exits will be gradual as price approaches the previous day’s lows, on longs the way out will be in stair steps with targets at $1, and move stops higher based on the higher lows made by FOXO.
6. SNAP (Snapchat)
Overview: The snap’s current range continues to move against its 200-day moving average, which has been resistance. A breakout above $12.50 could prove to be an area of continuation higher.
Trade Entry: Enter on a breakout above the 200-day resistance area at $12.50. Seek long entries with evidenced follow-through volume looking to hold the high of day.
Exit Strategy: Hold stops at day’s low and let SNAP make profits methodically if the market strength picks up above the resistance. Seek volume continuation before getting into complete positions.
Conclusion
The structured watch list provides a systemic approach to capturing opportunities in the next trading week. Each of the selected stocks gives unique setups based on recently traded prices, resistance and support levels, and volume trends. The outlined entry and exit strategies can be applied in the market with increased confidence and the freedom to adapt.