CRCL Looks Tempting—But Here’s Why I’m Not Touching It (Yet)
June 27, 2025 — When discipline beats desire: why skipping a setup can be your best trade of the day.
CRCL
I'm staying true to myself and my patterns. As badly as I wanted to trade this as a LFGD, it simply doesn't qualify. It’s not a 3 Day Down LFGD setup—meaning the odds are not in my favor unless we gap down or go green to red. That’s my line. Until then, I’m ignoring it. Be disciplined. Wait for the highest-odds opportunity to extract your best edge.
NKTR
This stock gapped up two days ago on solid Phase 2b news for their dermatitis drug. Since then, it's spiked nicely for two straight days and is now gapping again, offering a potential 3 Day Up Short setup.
Despite the bullish news, I’m just playing the chart. I believe the 1-for-15 reverse stock split on 6/9 played a major role here—reducing the float from 184M to about 12.5M shares, adding fuel to the recent momentum.
This isn’t an A+++ setup like CRCL or some of the juicier high-flyers, but it fits my system and has real volume, real liquidity, and clear behavior. So it’s worth a stab—with smaller size.
Scenario Analysis for NKTR:
1. Straight Crack off the Open
If we dump right out of the gate, I’ll look to short pops vs HOD risk. I’ll start with half size, knowing I might need to cut quickly. Accepting the possibility of being wrong helps me stay open to what the price action is actually saying. If the play confirms in my favor, I’ll scale in and move risk down. If it reclaims higher, I was wrong—simple as that.
2. Spike Off the Open
If we spike toward the previous day’s HOD (~$34+ range), I’ll short vs the $37.38 highs. Again, half size to start. If it confirms, I’ll add and move risk down to the HOD.
3. Sideways Action at the Open
If we just chop around, I’ll wait. Let volume fade. Watch how pops or HOD perks react. If they seem weak, I’ll start in small, then add on a break of LOD with HOD as risk.
Risk Parameters:
Since I don’t love this pattern the way I did the CRCL short, I’m limiting myself to $1,000 max risk on the trade. That’s enough to take a meaningful position while still protecting recent progress.
If I see great spots to double down with defined risk, I may take them—but the goal is safety, not swinging for the fences. This is a routine trade with technical merit.
If anything feels off—spreads, bid behavior, volume—get out. Try again later if it sets up again.
🔑 Listen to the chart. It will always tell you the story.
Not financial advice/advisor. Do your own DD.