FVRR - What an IPO! Plenty of setups to get long today. A setup is simply the anticipation of demand > supply or vice versa. Being able to identify a supply (resistance) level and anticipate a move up as demand (support) starts to 'breakout' a stock is key to being a successful short-term trader.
Demand can come in many forms: Perceived positive news, hedge fund buying, day-traders, algorithms, an Investment Advisor raises the target price so brokers call clients to get them to buy, shorts have to buy to cover, FOMO chasers, etc. It really doesn't matter why the buyers are present, but that you can identify this action and join the trend.
As a trader, our job is to anticipate the move as analyzed through the price action. Becoming emotionally invested in a news story or earnings report turns you into an investor rather than a trader. You'll find yourself not sticking to price action rules. Again, traders focus on price action, Investors follow stories and earnings. If you want to be a serious short term trader live by this:
Know the news, Trade the action.
When to take profit or cut losses you ask? General principles: Knowing when a trend speeds up (Bump & Run) is a great identifier of a short-term top. 1) Sell into speed ups and/or uptrend fails. 2) Set a stop at even if the trade is working. Never let a winner turn into a loser. 3) Know your risk going into the trade, so if the breakout fails, you can bail and lose as little as possible. Save capital for the next trade. If you're worried about the pattern day-trade rule, check out a few solutions here to calm your nerves.
Okay enough ranting, onto the setups I'm watching develop for Friday:
FVRR - Probably gap and runs a bit. Use 40 as risk guide if late to the party. Be ready to identify trends. Thursday's 3-minute chart is a great example of how price action study can pay well once you know how to anticipate the next leg up or trend fail.
LYFT - watching for breakout over 62.50ish area to add 70 calls. Feels like a $5-10 breakout day coming soon. 11% short float. Swing trade potential as well.
UBER - of course UBER was working higher with LYFT. UBER needs to reclaim 45 to have a chance at new highs next week.
NFLX - watching for breakdown below support level 340 to buy puts. Swing trade idea if closes below 340 soon.
DIS - Awesome breakout today. $160 price target helped get it started. (Know the news, trade the action) 142.50 area next key level to keep this run going. The 6/14 $142 call went .03 to 1.00 Thursday. Crazy power of options. Once you understand price action and can anticipate the moves as discussed above, you can start using options to magnify profits.
SNAP - Needs to hold 14 to have a chance for next leg higher. Long-term resistance here as well. IF/when it breaks through, it could be quite powerful. 9% short float
Others: BYND, AVGO, ROKU, CRWD - more charts on twitter as setups emerge.