Hey there, VWAPians!
I’m sure you’ve heard me say that this is the greatest market ever.
A little clarification is in order, for the guy in the back.
This is the greatest trading market ever.
I’m a day trader. I like to stay nimble and strike while the iron is hot.
When I hold trades overnight, I tend to get burned.
You know what kind of trading that isn’t? Disciplined.
Thankfully, earnings season is almost upon us.
This wonderful time of the year is probably when the 1-minute Multiday VWAP reversal works best. I’m already salivating at the opportunities.
And for LIFETIME members of my Warlock’s World, we’ll be running EXCLUSIVE pre-market and after-hours sessions to get prepped to jump on any VWAP trades.
The first one is coming up soon, from 3:30 to 4:30 p.m. ET on January 13th! Put it on your calendar, Blanche.
Now, normally, I get started EVERY DAY on Money Morning LIVE from 8:30 to 9:30 a.m. ET RIGHT HERE.
This ain’t gonna change — I need to see my dance partner, Olivia Voz, and my crush Mark Sebastian (he’s so dreamy in his red shirt).
But during earnings season, sometimes I’ll be getting an early jump to the day with LIFETIME members of my Warlock’s World.
The first of these brand-new EXCLUSIVE sessions pops off on January 14th at 8 a.m. ET!
This is a crucial day for earnings, as four of the biggest banks kick off earnings season. So I want to make sure my LIFETIME Warlock’s World members are prepped and ready to trade!
With more Warlock in your life, how can you lose?
Back to the topic at hand — discipline.
As VWAPians, all we really care about is that a stock is breaking VWAP. The why doesn’t really matter, because IT IS breaking through VWAP.
Earnings season presents multiple opportunities for VWAP trades because earnings brings the “V” of VWAP – VOLUME!
There were a few companies reporting earnings on Thursday. So I took those companies, and I put the stocks on my watchlist.
Then I did one of the hardest things to do in trading — I waited and watched.
The stock I was watching the closest was Bed Bath and Beyond (BBBY).
Why this stock, in particular?
After having been lumped in with some of those “crazy names” or “meme stocks” in the past, I thought that perhaps this stock had the potential for a really big move.
And boy, was I right.
When hunting 1-minute Multiday VWAP reversals on stocks that reported earnings, it’s CRUCIAL to be able to trade in the pre-market.
VWAP works pre-market. VWAP transcends all time and space.
Most brokers allow pre-market trading, and oftentimes all it takes to get access is to give your broker a phone call.
Because if you’re not trading pre-market, you’re missing out on a good opportunity to get your day finished before it’s even started.
Take this BBBY trade, for example.
BBBY 1-minute mulitday VWAP reversal after reporting earnings
I don’t really care about the drop. What I do care about is what happened shortly after.
BBBY then broke VWAP to the upside. Why?
Remember, like I said earlier — it doesn’t matter. What does matter is that the stock IS breaking through VWAP.
BBBY fell below the 1-minute VWAP by a whopping 3 cents. The share price rose over the whole number ($12), then broke VWAP.
For me, it was BUY right there. I got in at $12.20, using the low prints of the day, and $11.90 as my stop.
I’m risking $0.30 on the trade, while staring at the Multiday target around $14. Just like that, I’ve defined my trade.
I have my entry price, target price, and stop loss all figured out – based on what the chart tells me. Then look what happens next.
The share price starts to rise. Before hitting the Multiday, BBBY goes green, or positive for the day, which affects trader psychology and spurs more buying.
As the share price went up, I sold into the move and raised my stops.
This makes sure I’m not getting caught by a sudden move back to the downside and locking in profits.
Once BBBY crossed the Multiday VWAP, I was out of the trade. Sure, I could have held for a move higher, but I had hit my target.
On 1,000 shares of BBBY, the move from my entry of $12.20 to the multiday VWAP of $14 would have brought in a profit of $1,800!
ALL of this happened nearly an hour and a half before the market opened.
Just like that, my day is finished before it’s even started!
Make no mistake, Blanche, this isn’t because I wanted to gloat.
I want YOU to be your own trader. Learn how important VWAP breaks are on earnings reports. I want to save everyone the way VWAP saved me.
The BEST way for that to happen is to make sure you’re a LIFETIME Warlock’s World member so that you can hang with me behind the double velvet rope for EXCLUSIVE earnings sessions.
But for now, make sure to get your butt back to the BIG ROOM at 1 p.m. ET TODAY to finish your week with ME!
That’s all for now, VWAPians!
Kenny “The Warlock” Glick
January 07 2022