Day Trading The Knot Inc - KNOT

I’m in light day trading mode. I’m really waiting for those trading patterns to play out fully. With the market playing a game of Russian roulette on each break higher, I’m content staying patient with the trades. I’m still in the RYL and XHB long trade. The stop-loss moves to .20 below the daily low for each stock. The OIH is staying close to it’s 20 day moving average after the fall last week. I exited that trade the same day. As for today, the morning list of gapping stocks included KNOT - The Knot, Inc. This stock looked interesting so was put on my stock picks to watch.

After a quick pop higher in KNOT - The Knot, Inc., it drifted lower slowly. As I watch both the 5, and 15-minute candlestick charts, I chose the 15-minute chart for entry. The 5-minute chart was too choppy. Recognizing the BL2 trading pattern, the trade was taken over the higher high of the 7th bar. That bar was .04 wide. Here’s where you make the choice of reward vs. risk. You can use the bottom of that 7th candlestick as a stop. You could also use the prior bar’s low. Since the low for the day is so close though, it would be most practical using the low of 24.80 as a stop. R = .20, depending on the fill. It makes me happy when the stock pattern works right away. That’s the case here.

Half the shares are sold as the stock moves past 3R. At this point, I let the rest of the shares play out the rest of the day with a stop at break even.