VRS Setup and Trade Plan

Today's Featured Trade Idea is VRS short.

Members can join us in Trading Room #1 as Rick reviews this setup and other Trade-Ideas at 9:10am Eastern.  For now, here are my own analysis and a potential trade plan made using our Trader Vision 20/20 software.

VRS has formed a Head & Shoulders pattern, coupled with a Blue Ice Failure pattern and a Dreaded-h pattern. It has broken (or is testing) the last Support level before a large void down to the $22.45 area.

I will look for a short entry on follow-through with a substantial Stop and a single target (off daily and weekly charts).

Please consider the volatile market with big candles and also earnings.  Trading at all at such times is a very risky proposition.

With at least 3 weeks until earnings and one bullish to 5 bearish conditions, VRS a nice chart setup. However, keep in mind the very volatile market and the risk that earnings throws the market the other direction.

TV20/20 tells us this plan offers a nice 3.27:1 Reward/Risk ($605/$185). That would equate to a 21.23% gain. However, it requires a bit more risk to stop-out than I'd prefer...and the market has been very volatile. Pre-markets are also indicating we'll gap higher and there are many earnings out before, during and after the session.  Caution is the word of the day.

Having this knowledge before a trade is even entered makes it much easier to control emotions and maintain discipline.

Below is my markup of the chart and the trade plan as laid out by Trader Vision 20/20.  As a bonus, if you click the green button below, you'll be able to watch a video of the chart markup and trade planning process.

The VRS Trade Setup - As of 10-24-18

VRS Chart Setup as of 10-24-18

The Trade Plan

VRS Trade Plan for 10-25-18

Note how Trader Vision 20/20 does so much of the work for you.  Knowing the ratio of Bullish Conditions to Bearish ones as well as the overall risk of the position size, the risk to Stop out and the Reward possible at each Target price can help a great deal with controlling our emotions.  Knowing the dollar impact of every scenario ahead of time, allows us to make calm decisions during the trade.  It really takes the pressure off.  No guesswork.  No surprises.  No emotional roller coaster.

To see a short video of this trade's chart markup and trade planning, click the button below.

 

Put the power to Trader Vision 20/20 to work for you...

 


Testimonial

Trader Vision immediately simplified the process...immediately it provided that information and guidance to me. I knew what I would risk for how much reward, I began taking trades off at the 1st target, 2nd target, I was no longer holding all my trades for the homerun. I also began implementing the stop losses if and when they were reached, not just hoping the stock would recover.  It then became easier to see what patterns were working for me and which were not.  It provided a much more relaxed and stress-free environment. -Joan G

 

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Investing and Trading involve significant financial risk and are not suitable for everyone. Ed Carter is not a licensed financial adviser nor does he offer trade recommendations or investment advice to anyone. No communication from Hit and Run Candlesticks Inc. is to be considered financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.

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