 Welcome back with us folks and thank you for taking the time to watch this recap of a play that we We entered yesterday and We sold most of our Most of our calls today This is Delta Airlines and the idea behind this video is to show you how I Prepare for a trade how you can prepare for a trade Setups that may occur and what I like to is to set up a an alert An alert level that will trigger it will draw the attention My attention on the chart and eventually it will It will lead to a an entry or just something that will Will end up doing nothing. So this is the the daily chart on on Delta Airlines the The idea is to look For support and resistance and see if there is a possible breakout now. I'll show you something here back in COVID days right here. Let me take a screenshot of this. So I'll show you or we're still in COVID days, but Back where COVID occurred and 2020 This is when the real drop happened, right? There's a gap here to On and the chart for nothing Then there is an attempt to rise above it But it got rejected Do you all agree on this right? So Here is a point of attention Saying that this here is a point where Sellers no longer will actually there you didn't find any buyers here, right and They sold to a point where it dropped Quite a bit quite a bit in fact there's nobody here. That's the gap and Then we start rising we're not entering the gap Get out of here just for a second. I'll continue on this On this little support and resistance just to show you a few things Let's get back here It's moving up. Oh It's not getting as high as this It's rejecting and then it's taking it's taking off comes back down Down down down All this is resistance you agree on this and then down to a certain point Right that green line It's a 200 DMA Down to a certain point. It's struggling and then it flushes underneath Right, let's move on Sorry, I'm not having a hard time with this little button Let's move on here. I'll zoom in here and Let's do this again. I'll show you we have buyers find at the bottom, but we get to a point where Okay, this is where we flushed through the 200 DMA See that it was bouncing and then it flushed underneath it rejected it tried to get above it It's a 200 DMA that I'll show you what it is in a second. So Found buyers at one point Up to a certain point. It's trying new it's trying No, it gets rejected and then it's trying again and again and again and now all this Right is a line That is of interest Now, usually I start closer to where we are we start we started back to COVID debut, but Usually I start with this we all agree that this is a line here and then I look back and Then I figure out that oh, that's the gap from pre-covid Hold on a second Take this off for a second and let's draw the line Right here. See this yellow line Okay, let's move back Let's see what happens Now this is the top that got rejected and this is what I do. Oh Oh COVID and we used to be support and then we flushed through Old support becomes new resistance So basically this is a line of interest because right now Delta is trying to get above that, but it's not getting through What I do I will set an alert to that very Number 41 67 now this is the daily. Let's go to the five-minute chart This is what happened people were saying hey guru. How did you how did you know it's going to pop? well first You're never sure that it's going to pop. However, it's doing something and this is what it did It I'll show you when it happened This was prior to the feds minutes coming out on Wednesday So everyone is kind of walking on eggs. We're all expecting something to happen But no one really knows what it is but See that Delta went precisely on that line obviously it triggered the alert But it rejected the line at the top here came back down and It went precisely on it again, and it rejected it now as It came down This is where I alerted the entry Why because we're so close to that two o'clock minute Coming out from the the feds meeting We're very close to it people are taking profit because people are not so sure of what's going to happen but I was under the impression that they were going to kick kick the can a little further and the fact that we had breached just the hair above it and we were really trying any Good bullish news would have pushed this further So this is where I decided to enter long not because we're rejecting but this is pretty much what I Tried to explain with Riley this morning and the podcast Basically on the breakout what happens, but often it what will often happen happen is this We get above it now this this is clear rejection and clear rejection here But sometimes it will do this Forget the rest of the chart. I mean look at this here. It will get above it Then it will come down test it sometimes it will bounce on it Get a little bit underneath and then it will start rising Now this is what I thought sorry about this. This is what I thought it would it would do come on it would do After the apple of the the feds minutes, which would would have been here We come out test it a little bit under and then we could have Gone up again. However, this was very close the end of the day Normal behavior where there's a some profit taking before the end of the day and then the next day This is why I decided to swing next day was it took off so rejection there's some profit taking and just Look at it as a trampoline kind of thing You take a swing and then it's going to bounce off something and go get the energy um Accumulate the energy to to pop above the line. So this This line popping And expecting a breakout was my number one Um My wonder one number one trigger Why because I had set an alert ahead of time looking at the chart saying well If we get above this line We get into the buyer side. I'll show you that in a second and the second reason is The amount of calls The volume on the 42 calls that we're expiring The same week with less than two days before expiration was extremely high Above 15,000 contracts. So either All of these guys are wrong But the accumulation on the 42 42 calls for this week Was extremely high now. I talked a lot about buyers and sellers. I'll go back to the um To the one day chart to show you You know, probably see what I mean. Basically what I mean is this All these guys here Selling when they reach that yellow line, right they'll sell Because the pressure is down on on the uh on the sell side Basically imagine a computer that says when it gets to 41 67 you sell however If we get above it as as we get above This yellow line, you know anything above that we are into the buyer side Why? They are no longer any reasons to sell It's not bouncing. No, it's getting through and the only way to get there Is if we step above The trigger of the downside trigger That's the breakout. We're expecting and I'll show you Exactly what I looked at for just entering the trade. Give me a second So this is what I like to do. I take I pull up the chart for the 42 Call because I was under the impression that if we broke for 42 Would be in the money And quickly it would be very rewarding. So I was looking at the 42 calls for this week on delta airlines if you want to know how to do this I Posted a video showing you how to do it on mobile and on your desktop to know how to pull up the chart for the option itself And look at this. I mean don't look at the late at thursday We were looking at this guy here, which is on on the 20th 9000 contracts Volume is 9000 contracts the next day 3000 plus and the following day 6000 plus So all this I looked at, you know Three days while the current day and the two days before and we were up about 15 000 contracts We are still not into money yet and we have less than We have two days to go until expiration To me that was very bullish. I mean if you look at the rest of the volume is pretty pretty low on it so How to determine if it's If they're not selling the options The fact that they were accumulating in day after day after day adding more and more Of volume As we are getting close to this breakout Was really tempting saying well It these are not people selling options. These are probably people buying options And the other thing is we were very very close to that breakout line that was already prepped in the chart So again what you look for in the first place I still believe that price levels are super important. So price levels Where you have your Resistance your support that you draw You're expecting something to happen on that line. It may reject it again But because we were bullish on the whole market and remember that delta airlines is a dowel component. So it's kind of Up there with the rest of the market and second Was the volume on On calls That triggered the idea about Going in so in the end just to recap we got in On that particular day which was yesterday we got in at 27 cents For the calls we sold half I have a 100% rule and we were just above that I sold half at 55 cents which is 100 percent of what we invested And I sold the rest for 65 cents, which was I believe 140 something that percent on the remaining position I kept a runner or two We're keeping a runner or two is a good idea if you want to keep going If you're still bullish on the play Sometimes, you know, this is good enough and we can move on But the idea behind the whole thing is to show you how we played the breakout And how we prepared ahead of time to see where this breakout was. So Well, I hope you learned something and Thanks for watching and make sure to hit that little Like button and if you're not subscribed yet, just click that subscribe button This is really helping you can get your alerts sent to you directly when we post new things And this is obviously helping us out. So Thanks for watching the show and I'll see you soon