Staying Disciplined for the Win

Hello, VWAPians!

I hope you had a great weekend.

Friday was the finale of the Two Day Hall Pass – the all inclusive two day admittance into my Warlock’s World – and it was a doozy.

You wanna know why?

Because 1-minute multiday VWAP reversals on stocks that report earnings continue to be consistently winning trades.

While Thursday had a flurry of upside activity when the market opened, on Friday I provided a great example of how VWAPians can stick with one stock all day.

As Warlock’s World members witnessed, that stock was Foot Locker (FL) on Friday.

I lost count of how many times I entered trades on FL. The stock was below VWAP, after it had dropped 30% after reporting earnings.

I kept trying to pick the bottom. But bottoms pick themselves.

At one point, we even decided to add a disclaimer to the screen in Warlock’s World.

Added a disclaimer after my multiple attempts at picking a bottom on FL.

The great thing about trading VWAP is that trades are risk defined.

Even though FL stopped me out several times, the losses were minimal.

As 8-Baller says, “getting stopped out is the stock waking you up to price action.”

In Warlock’s World, just because we get stopped out once, that doesn’t mean that we pack our bags and go home for the day.

We work the trade.

So even though I might have looked like a madman for going back to the well with FL, eventually, my discipline was rewarded.

FL eventually broke VWAP to the upside on Feb. 25.

Foot Locker (FL) finally found its way up to and through VWAP to the upside.

Remember, this was a stock that was down 30%!

From a bottom of $26.36 to $29, FL would have provided a $2,600 profit on 1,000 shares!

The important lesson from my FL trades is that I kept working the trade.

Getting stopped out didn’t send me packing. Getting stopped out happens.

I had no fear after getting stopped out three or four or even five times.

Because as we teach in Warlock’s World, VWAP trades are disciplined.

I’ve never seen a market where VWAP trades on stocks that reported earnings WORK SO WELL.

This ain’t no 50/50, Blanche. This is probably more like 99/100. PRINT THAT, BLANCHE.

Not convinced?

Join me today in the BIG ROOM at 1 p.m. RIGHT HERE as I review today’s trades and hunt for more BANGERS.

That’s all for now, VWAPians!

Kenny “The Warlock” Glick

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