Hey traders, Barrie Einarson here from Trade Ideas, back with another installment of “What Makes This Trade Great.” Today, I’m diving into a trade that caught my attention, and yes, it was all about LOVE! No, not that kind of love – we’re talking about the ticker symbol L O V E. To Subscribe: https://go.trade-ideas.com/SHQ
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The Setup: Spotting the Alert

So, here’s the deal: our AI-generated alert triggered on LOVE at $24.74. If you check out the five-minute chart, you’ll notice the blue arrow marking the exact moment of the alert. As is often the case, the initial reaction was a quick pop, followed by a pullback – and that’s where the opportunity gets interesting.

Many traders see a quick move like this and assume they’ve missed their chance. But the truth is, you often need to stay patient and watch how the price action unfolds. LOVE pulled back after that first alert, providing a great re-entry opportunity around $23.87. For those who were vigilant, this was a textbook example of how to capitalize on a second chance in trading.

Why This Was a Great Trade

If you had taken the trade at either the initial alert at $24.74 or waited for the dip around $23.87, the reward was significant. LOVE surged all the way up to $26.60 before any meaningful pullback occurred – that’s a great move for a single day!

What made this setup particularly compelling? It was an earnings play. Earnings releases can create a lot of volatility and, in many cases, sustained momentum. When a stock is on the move due to earnings, it can often stay active throughout the entire day, providing ample opportunities to ride the trend.

Looking at the Bigger Picture

Now, let’s zoom out for a moment. Looking at LOVE on a daily or even weekly chart, there’s still room for this stock to run. The next significant resistance level I noticed was around $29.51. I’m not saying it’s guaranteed to get there, but the setup suggests there could be a second or even third day of continuation, especially given the momentum we’re seeing off the earnings report.

Key Takeaways for Traders

1. Stay Alert for Second Chances: Don’t assume the opportunity is gone just because you missed the first move. Stocks often pull back, offering another chance to get in.
2. Watch for Earnings Plays: These can provide some of the best opportunities for short-term trading due to increased volatility and volume.
3. Understand the Bigger Picture: Always check the daily or weekly charts to see where the stock might head next. Knowing the potential upside or resistance levels helps you plan your trade more effectively.

Final Thoughts

Remember, trading is all about staying focused, being patient, and capitalizing on the right opportunities when they present themselves. LOVE was a great example of how to use AI alerts, technical analysis, and good old-fashioned patience to find a winning trade. For more information, check out my homepage

That’s all for today, traders! I’m heading back to the trading room. Stay sharp, and I’ll see you tomorrow with another great trade idea!

Happy trading!
Barrie Einarson