Post Trade Review

Originally, I did not have NU on my watchlist since there was no significant news catalyst. However, my interest in NU piqued when I noticed we were trading at high relative volume in the pre-market and into the open. When I considered entering the trade, we were still at around 5x RVOL. We experienced a very powerful opening drive, more than a full ATR, which was followed by a crash below VWAP.

When the price came back to VWAP, we traded above it on three candles. I decided to enter a long position, but the price immediately fell below VWAP. At this point, I switched my position to a short. The narrative for a short position made a lot of sense here. Buyers pushed the price up on a strong opening drive, but then sellers came in strong and pushed the stock below VWAP. When buyers tried to reclaim VWAP, sellers stepped in again to move the price lower.

My entries are in the table below. The blue arrows on the chart represent long positions, and the red arrows represent short positions. The red line is VWAP, and the blue line is the 9 EMA.

I really liked this trade. It made a lot of sense to me, and it helped that it cleanly trended down all day. However, I definitely took profits too early. I was fully out of my position during the first crossover of the 9 EMA. I’m considering starting to take profits at better increments, like 1:1, 2:1, 3:1, etc., R:R. I recently downloaded Bookmap, which I think will help visualize where the orders are sitting. You can see the rest of the day on the chart below. We continued lower all day, and I was only able to capture about half of that move.