HOOD and I have had a mixed relationship over the years. I have had my biggest win on the HOOD brokerage (5,000% options trade, $1200 into 60k) and at the same time I was present for the Derogatory removal of the GME button (of which I had sold before they took that button).After many years and brokerages, I find myself returning to HOOD but this time much more experience... To my surprise, I love the platform, and I still recommend it for new traders for the ease and UI. Honestly, unless you are dealing with BIG Volume or Hot-Keying out of Low float Penny stocks, It will suit you just fine.
Now Let's Talk HOOD.
In this MASSIVE range we are looking at High $67, and a Low of $35. Thats a 47% drop!
Although we have recovered a bit, Many are eager to find a way to get in the range. Here I have put together 2 scenarios to help you play your position with confidence.
Better Price = Better psychology
Whether we are shopping at grocery store, or if we are buying a car. Getting a good deal feels better. But how do you feel when you know you overpaid?
TLDR: The best deals are the lowest purple zone "Extreme Demand" if you are Long, "Reinforced Supply" (at the top) if you are looking to get short or take profit.
Under the HOOD
Currently Robinghood is running into a little bit of a supply zone labelled "Weak Supply"
This is a new player, and we don't yet know how just how big this player is. So far they have absorbed some of that buying pressure coming in, but I would not be surprised if they we overtaken or even gapped above come Monday. This brings us to our first Scenario
Scenario 1: Blue line
With the break above "weak supply", there is headroom all the way until 51.74. This is where we will see some supply initially and maybe a small rejection.
Why would it not reject back down to a demand area like 41? Great question.
If this overtakes that "Weak Supply" zone, this will make a strong case that there is momentum behind the wheels here. I think there will be a new player reinforcing this buying if this happens all the way to the Finale at $58.01. From here I would consider taking some profits, maybe partials, or looking for some Puts.
Scenario 2: Red line
Getting Rejected by "Weak supply" would be evidence that this move was fluff. Those two demand zones may try to hold a bit, but with the lack of buying interest in the
$45 area, this won't make those buyers feel confident.
This is different story when comparing to the "Extreme Demand" zone (lowest purple zone). Buyers here have PROVEN that this is something they are very interested and they are not done accumulating yet. So from this location buyers feel confident that they are getting a good price*(see fn.)
From here this should drive demand up again, crushing shorts, and sending another nice squeeze to test that supply at 51.71
WHEW! if you made it this far, I appreciate your time!
Upvote/Follow if you enjoyed this idea, there are many more to come!
Happy trading!
* (This is a good price, because buyers are showing that it is. Although, if it did come down here, this would be the 4th test of this area. I still think there will be strong demand here, but this isn't the best tests. 2nd and 3rd were stronger.)
Trade active
HOOD up to 48, still have a little ways to go. Broke through that Weak Supply zone (not surprised). Again should get a little rejection off 52, but really looking at that 58 for the short. Happy trading!Note
As you can see, With the Tariffs heavily putting pressure on the market, We have now run into our extreme demand zone. If we were to close below this level on the daily, then we could consider the buyers to be satisfied at the level. The market would then naturally drift (or fall in this context lol) into the next pool of liquidity. A lot of people are buying here, but that does not mean that this demand will not get satisfied, I stick with my current consensus that this is a good buying point.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.