My bet that BABA would form a bull Flag rather than roll over paid off. I was able to sell it near the upper trend line today in Premarket.
Sold: 110.20 +3.60 (+1.25R)
Why did I close here despite the formation of a bull flag? Several reasons, first betting on a trend line break is not a high reward trade. I missed my opportunity to sell over 111 and decided just to get other was a decent chance the market could have pulled back. Indeed, BABA would have pulled back to 108.80 on the day. I don't like giving profits back. Second, I was not hugely optimistic that this trade would work in the first place. I don't normally like to enter positions on or immediately after big bars. Third, I had a good result that warranted locking it in. Finally, a bounce in bull flag is still a counter trend trade. Counter trend trades have a fast expiration date.
The plan going forward is to wait for more consolidation or a LRE and then take a position if market conditions warrant.