Hello everyone, Barrie Einarson here from Trade Ideas with today’s edition of What Makes This Trade Great. To Subscribe: https://go.trade-ideas.com/SHQ
Use Promo Code BARRIE15 for 15% off

Today’s focus is MRVL — Marvell Technology — which reported earnings this morning. Now, it wasn’t exactly the easiest environment for an earnings play. The overall market was under quite a bit of pressure early in the session.

If you look at the SPY, it was pretty much straight down for a good portion of the morning. The market was getting shellacked, and when that happens it can make it difficult for even strong stocks to gain traction. We did see a bit of a bounce later, but for much of the morning we were trading in what I’d call no man’s land.

Despite that backdrop, MRVL showed some relative strength.

We had an alert from Trade Ideas at $89.40 for a long entry. After the alert triggered, the stock actually pulled back a little bit, drifting down toward the VWAP — which you’ll see on the chart as the purple line.

Now, for traders who pay attention to VWAP — and many of us do — that level often becomes a key decision point during the trading day. In this case, VWAP acted as support.

The stock tested that area, held it nicely, and then bounced off the level with a solid move higher. That bounce gave traders a very clean confirmation that buyers were stepping in.

Those are the kinds of setups we like to see —
an alert, a controlled pullback to a key intraday level, and then continuation.

Even in a challenging market environment, strong stocks coming off earnings can still produce great opportunities.

And who knows — MRVL could continue to trend higher throughout the rest of the day.

Have a great weekend everyone, and we’ll see you back in the trading room on Monday.