Roku is setting up for a 418 test with a possible sell off to 407 lvl tomorrow 1/20/21. We can see a double test of the 426 support area with nice bounces each time. Another tell is the follow through of the bounce at the 426 area, todays bounce puttered out at 435 with no continuation.
My plan:
1/22 420 put (3.4/3.65) on 426 lvl break (quicker momentum play)
1/29 405 put (5.45/5.55)
*ideally I would like ROKU to rally at open 430-437 range before failing, I will look to begin entering puts then
Indicators:
- MACD cross over on 30 min chart.
- Daily RSI overbought, MACD beginning to head down
- approaching a LVN on volume profile, Daily POC in showing stronger price action at 411 area
Sector Divergence: from 1/4 to 1/19 NFLX fell to a max of -10% (touching 485 area), in that same time period 1/4 to 1/19 ROKU exploded 41%! It rode the back of price upgrades and sector hype but now we see that flowing into NFLX today!
levels provided by EliteOptions
My plan:
1/22 420 put (3.4/3.65) on 426 lvl break (quicker momentum play)
1/29 405 put (5.45/5.55)
*ideally I would like ROKU to rally at open 430-437 range before failing, I will look to begin entering puts then
Indicators:
- MACD cross over on 30 min chart.
- Daily RSI overbought, MACD beginning to head down
- approaching a LVN on volume profile, Daily POC in showing stronger price action at 411 area
Sector Divergence: from 1/4 to 1/19 NFLX fell to a max of -10% (touching 485 area), in that same time period 1/4 to 1/19 ROKU exploded 41%! It rode the back of price upgrades and sector hype but now we see that flowing into NFLX today!
levels provided by EliteOptions
Trade closed: target reached:
Roku played perfectly like my plan outlined, I played lightly as I was caught up in amazon and TTD this morning. tends to be a slow mover. I am watching 407 lvl next week, when that falls I expect 20 points to the downside. We hit the 418 lvl today so far.
Comment:
another price target upgrade on ROKU lol they just keep coming in. Avoid puts unless 400 is broken imo.
All supports and resistances provided by the above group. highly recommend if you want to take your trading to the next level. Trade idea and execution was purely my own DD
*another reason I liked ROKU put/short opportunity was that I noted how heavily ARK funding had purchased them previously. I knew it was only a matter of time before they got rid of shares seeing as ROKU rallied even higher on the PT upgrades. ROKU is still a great opportunity to short. If we break the 407-400 lvls we could quickly accelerate. I will be watching them this week to swing this week or next week puts. ARK sold lots of shares on Friday and they still have a lot more to sell :) to be exact they sold 111,070 shares. If you pull up fridays charts you can see this in action. I was in roku puts friday. From their website it looks like they still hvae 4,189,002 shares of ROKU, which is bonkers lol watch that 400 lvl