UAL Trade screenshot

Video Transcript

Hey everybody, this is Theta Warrior. In this video, we’re going to discuss our recent trade in United Airlines (UAL). We’ll talk about why we entered the trade, why we exited it, and the gains we were able to capture.

First, a bit about me. I’m a technical and flow-based trader. These are the two main criteria I consider when entering or exiting a trade. So, let’s dive into the chart.

On June 2nd, a large order came in and bought two million dollars worth of slightly in-the-money 44 calls on UAL. This caught my interest because the open interest was exceeded, indicating a new bullish position.

I posted this information because I found it actionable and interesting. This order put UAL on my radar. Looking at the chart, we can see a significant drop followed by a sideways consolidation pattern. The price seemed to be bottoming and attempting to move back up.

The large order came in around this tight grouping, which also coincided with a resistance level. There was an ascending triangle formation, suggesting a potential breakout. As a breakout trader, I wanted to buy if the price broke above the resistance level.

Once I had analyzed the flow and the chart, I added UAL to my watchlist. I shared this information with my members and mentioned the specific call option I was considering, the 50 call expiring on June 16th.

The next day, the price pushed above the resistance level, and I entered the trade by purchasing the 50 call at 75 cents. As the trade worked in my favor, I took profits by selling a portion of my position. I continued to trim my position over the following days while keeping a smaller portion as a swing trade.

The original large order that caught my attention was still open, which influenced my decision to hold onto a portion of my position. On June 9th, another bullish order came in, reinforcing my confidence in the trade.

Ultimately, on June 9th, the price reached our target level, and I closed my remaining position. While I primarily focus on day trading, this swing trade presented a unique opportunity.

That wraps up our analysis of the UAL trade. Thanks for watching, and if you have any questions, feel free to ask.

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