On April 13th, AAOI gapped up more than 10% on company news. But the news was just fluff!�So after the jump the stock faded the entire day dropping from $50 to $45. This jump formed a gap fill area for AAOI between its April 12th�s close at $40.82 and April 13th�s $45, a $4 range. If the stock broke�below $45, it had the potential to drop all the way down to $40.82 in a matter of days.�When you see stocks reacting to news, it can offer some of the best plays of the year.
Gap Fill - AAOI's Bigger Picture
On April 17th, AAOI gapped up slight at the open and put in a dead cat bounce intraday. After the fake spike up, the stock broke back down underneath its VWAP. Right here we shorted it at $45.69 at 9:42 AM with a stop above the high of the day at $46.50. Sure enough AAOI dropped, putting in a new green to red setup. So, I added to my position at $45.28 at 9:45 AM. AAOI continued to fall and I scaled out of the move at $44.91 and $44.80. Throughout the rest of the day $AAOI continued to setup bear flag after bear flag. Naturally, we traded it a couple more times ending up with more than $800.Sometimes we have to focus on looking at the news and trying to figure out on the bigger picture, what should be happening. It�s important to have a thesis behind your trade and guide your decisions. Remember, you�re only as good as the stocks your trade.https://www.youtube.com/watch?v=kG7804LdlKMIf you�re not sure of the steps and practices that we�re talking about you can learn them all here at our Bulls Bootcamp. We�re having an exclusive spring time bonus for our�intensive�60 day course where we teach you exactly how I trade and why for only $2300. Not only that, our bonus also includes 6 months of free chat access and a Special Live Platform Setup Class on May 1. This deal is only for a limited time so to learn more or signup, email me at�kunal@blog.blog.blog.bullsonwallstreet.com�today!
