Called out a trade on twitter in BABA weekly options, yesterday on the 29th, which resulted in about 75% profit.
this post functions as an archive of the trade and the reasoning behind it, and the alerts that allowed us to get in the trade virtually at the low.
BABA on larger Timeframes shows a strong uptrend, therefore I look on small Timeframes for bullish PRZ reversals. Towards the end of the week I start to use shorter and shorter Timeframes; with expiration closer, the options move faster, therefore you experience larger moves on the options.
On a 1Min chart BABA entered a bullish PRZ just after 10AM, at which time we saw a huge increase in weekly option Call buying as detected live by our bot on twitter : @gr8estbot.
For about 5minutes the 80 calls traded inside the TD%F zone, around $1.40. We got some at $1.42, by the time I posted the various charts on twitter it traded at $1.80, but shortly thereafter fell back to $1.50.
By 10:35 an entry for a possible XABCD pattern was alerted, and from there on it moved higher rest of the day, up to yesterday’s high. Sold most at that point, and holding a few overnight, to see if today it can break higher.
TD%F zone on 80 calls: