Hello everyone, Barrie Einarson from Trade Ideas here with today’s edition of What Makes This Trade Great. To Subscribe to Trade Ideas: https://go.trade-ideas.com/SHQ
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Today, I want to take a look at DYN.

This was a pretty beaten-up stock, down around 15% on the day. We had been watching it in the pre-market, and at the time, we couldn’t really identify a specific reason for why it had been hit as hard as it was.

But that’s where things got interesting.

Rather than trying to guess whether the stock was going to immediately reverse, this turned into a fantastic VWAP play.

We saw the initial bounce, with DYN pushing all the way up to about $19.21. From there, it pulled right back toward that purple line on the chart — the VWAP.

If you weren’t comfortable taking the trade immediately on the initial bounce, that’s perfectly fine. Waiting to see what the stock would do when it came back to VWAP gave us another important piece of information.

And look what happened: it held.

That VWAP hold gave the stock a chance to start working higher. From there, we got some minor pullbacks and little jogs along the way, but overall, it developed into a very nice five-minute wave higher.

I obviously don’t know where DYN is ultimately going to end up. It could continue higher and potentially recover a significant portion of that earlier selloff. That would certainly be impressive.

But for me, the bigger takeaway is the setup itself.

This was a great example of why I like watching how a stock reacts around VWAP. You don’t necessarily have to chase the first bounce. Sometimes, waiting for the stock to come back to VWAP, seeing whether it holds, and then letting the price action confirm the move can provide a much cleaner trade.

So if VWAP trading is part of your strategy, DYN was a great example of the setup playing out beautifully.

That’s what makes this trade great.