Adding on the Dips and Pops

February 15th, 2018 | 3 minute read (Repost from We The Market)

In my recaps I talk about some of my goals. One goal is to add in dips and pops. What I mean by that is that if I am going long in a stock I want to enter the position when it is dropping. I get a better price. When I add to my position I want to add in a dip if I am going long. If I am short then I want to add to a pop up in price.

Both Level 2 and Time and Sales was giving me good direction on the stock dropping. A lot of sellers on the ASK and a lot of buying on the bid. Too much inventory so the Sellers are selling off.

My whole plan. I stopped out a little early and did not reach my profit target. But I was close. The strategy, VWAP entry expecting to drop. I entered a SHORT position while the ATKR price was rising. I added to the SHORT position. With that last pop up I almost stopped out but the Level 2, Time and Sales and the trend for the Day, Week, Month and 720 minute all indicated a price drop. I was not disappointed. Ideally I would have wanted to enter at $20.9. My last entry was my stop loss. I would have exited the entire trade at $20.91. The price tanked after that and I took profits on the way down. A little more discipline and I would have hit very close to my profit target.