This pattern keeps repeating in the market.
It’s my favorite trade setup. And we just saw it again!
Burn this price action into your brain.
I see it everywhere…
I sent an alert for my trade on September 8.
You had more than enough time to build a position before my exit alert on September 10.
That’s right… It only lasted two days.
We don’t need to hold these positions for long. They’re extremely powerful.
Repeating Price Action
The best part about this pattern: we don’t have to search for a catalyst.
There isn’t any stress about “finding the story first” or “being first to the move”.
All we care about is the price action.
I’m talking about a reversion trade. When a stock’s price extends too far in one direction from aggressive buying or selling. Eventually, it switches directions, at least briefly.
That’s the move I want. When the stock backtracks after an unsustainable run.
That’s exactly what we saw from Intel Corporation (NASDAQ: INTC) this week.
Recent Example
On September 8, my scans alerted a big move on INTC. That’s the beginning of the setup I like to trade (a big move in one direction).
Here’s what I sent to traders:
“September 8 @ 2:27 P.M. ET: BUY INTC 9/16/26 100 PUTS
Intel is having a massive squeeze day once it $100, it triggered a massive squeeze, but there’s massive resistance on the upside of early buyers here above $100.”
Look at the move on the daily chart:
The stock stayed elevated on September 9, but it couldn’t push much higher until it finally rolled over on September 10.
Here’s the alert I sent traders to exit:
“September 10 @ 8:41 A.M. ET: Once again pays to wait another day! EXIT INTC 9:30-10:00.”
Here’s the full move on an intraday chart:
It doesn’t look like much on the chart, but with short-dated options contracts, the % change is multiplied exponentially.
We see these reversion trade setups over and over again.
Look for oversized moves and play the exhaustion pullback/bounce.
Stay Street Smart,
Jeff Zananiri
