⚠️ Market is Overbought - Time to Take Profit?

Added: 2026-05-11

[00:00:00]This is an educational example based on my personal appreciably and nothing here guarantees profit or future performance.

[00:00:09]Hello everybody. Welcome to the trading with Ashley show. Hopefully you are all very busy this weekend looking at your portfolios, counting your wins and enjoying what is happening right now in the market. It is historical. What is happening is very historical. But let's talk about what's going on right now. If you have enjoyed some of the trades that I've taken just in my last two videos, if you were in either of those trades, you're doing extremely well. One of those trades is actually up over 200%.

[00:00:37]So, you might be looking at it and saying, "Okay, what do I do? This money has happened so fast, I'm not sure. Do I hold on to it? Do I actually cash in?" I have a very definitive answer for you.

[00:00:46]If you've been in Wall Street for any length of time, you know how these cycles run. And you definitely want to put yourself in a situation where you can cash in on some of your trades, especially those that are nearer term, and you can prepare for an eventual downturn, so that you can put that money into additional money-making opportunities. So, I'm going to take you through it all. We're going to look at some of the trades that you may have took alongside me and how they might be performing and what I am doing with them, and you can consider if that might be right for you. I did want to celebrate one very special member. His name is Conrad. He's actually had his 2-year anniversary with me. He just enjoyed his 70th birthday and he became a triple millionaire through trading.

[00:01:30]His account has surpassed the $3 million mark. But what made me so excited to celebrate Conrad, it's what he said and what he's enjoyed so much about the community is the interactions, the kind people that he connects with every day, the way that we strategize together and we help keep each other sharp. I was um watching something the other day and they said for you to avoid dementia or anything of that nature, you need to be social and you need to keep your brain sharp. Well, trading and being in a trading community, it actually helps with both of those dynamics. So, I love the fact that we have so many wonderful members that are actually getting so much joy out of what we offer. Now, all of you that have Discord, you may have been affected by this outage on Friday after market closed, Discord went out completely. And I think after that, we all came to realize how odd it is to feel disconnected with our trading community. If you want to be a part of a community that will welcome you with open arms and our entire platform is about helping people get the edge in Wall Street, then you really need to consider joining me. I would love to personally welcome you next week. I personally interact with all of my members. It's very important to me. If that interests you, click the link below and my team will guide you on how to get started with us. Okay, let's jump into the computer. I want to show you some of these incredible trades, what I'm doing with them, and how I am preparing for what happens next in the market. We are going to start off by looking at the indices and take a look at where we are technically based on all the things you're very familiar with. So, if you look at this, you can see something. It stands out to me right away. We have recently just popped right above that Ballinger band. Now, the Ballinger band can expand and it does at times, but that's really important to denote because typically it will pull back into the band and then eventually it may pull back up, but usually at that point the band has stretched a little. So, that's something to watch. The other thing that I wanted to bring your attention to, and this is glaring to me, look at where we are on the 14-day RSI. We are at 82.

[00:03:34]Now, most of you know from watching this channel, anytime we are at 70 or higher, we're overbought. Well, we were at 82.

[00:03:41]So, you would expect that something would happen to bring the market back into reality. Now, it doesn't have to doesn't have to happen in the next day or two, but eventually this will settle down by one of two dynamics. One, it'll pull down more dramatically and that will lower that average or it will stagnate and then the average will catch up with itself and it'll water it down a bit. So, either scenario could happen.

[00:04:05]But, I want you to be prepared for this.

[00:04:07]This is why I'm looking at some of my trades that I'm going to show you and why I plan on cashing in on some of them and letting others run. The next thing I want to show you is something I had shown you the other day. Looking at the parallel channel with the cues. Now, you can see something here. We have popped right above it. This is looking at the weekly candles. And notice that we have had six green weeks in a row. 1 2 3 4 5 six. That's pretty amazing to see. You don't often see that, but once you do, you do have to expect that more than likely we will eventually get us a red candle week. Now, that's not the end of the world. The market's more efficient if it does have red days, red weeks. But where will it settle down to? Well, now that we're above this, if if we happen to have a really good week next week and we end up going even higher, then it may use the top of this channel as support.

[00:04:58]If not and we come back in, it's realistic to think that we could get back to around 650 in a matter of two or 3 weeks if the market is under pressure.

[00:05:07]It could go lower. Obviously, if it went down to 600, that would be a more dramatic move, and I'm not looking for that to happen anytime soon, but watch for the midterm dynamics. There could be a little bit more fireworks as we get closer to midterms. Now, let's look at a few specific trades that you may be in from watching this channel so that you can have a better sense of what you may want to do with those trades. Here's the trade I shared with you just a few videos ago. I'm going to show you a little snippet of what I shared with you so that it can refresh your memory.

[00:05:37]There's not a lot of activity on the SPMO chain. So, I found this and I alerted the community about it literally just a few days ago and it is already up 27%. If you go to the chain now and you're interested in a trade like this, here it is, the 150 strike. Currently, the delta is 28. So, it's gotten a little bit stronger since I actually made the purchase. The current pricing is around $310. So, again, you'll pay a little bit more than we did in the community, but you can still get in on this trade. And you might even want to wait on a red day because this is out of the money. You will pay significantly less on a red day. Now, let's peek in on that trade if you took it that day.

[00:06:17]Here's my trade that I showed you in the video. I paid $235 for one skip call option. That current trade now is up over 200%. It's currently valued at $755.

[00:06:31]Well, if you happen to get in on the day that I showed you the video, then you would have paid 310. So, you would be up over 200%. That's a lot of money, and that's not something that should be ignored when you make that much money that quickly. Now, if you have a larger account, you will typically buy more than one of the trades I showed you. In this account, I actually purchased 25 and I paid 230 for them. And now, you can see they are worth significantly more. So, this one trade that I took on April 30th, it's up 263%.

[00:07:04]Now, that is not typical. And because it's not typical, I definitely don't want to look a gift horse in the mouth.

[00:07:10]This trade has made me in very short amount of time $15,000. So, what I plan to do, you see there that I have 25. I plan to go ahead and cash in on at least half of those. I may see if the other half want to continue to run in the next week or so, but more than likely in the next 30 days, I'll be out of 100% of this trade. It's just been so much so fast. I want to take advantage of cashing up on this trade that has a shorter expiration than most of my trades. And then I will use that profit to invest when we do eventually get a pull down. Now, let's review a play from a video I did just 4 days ago. This is DRAM. This is the one that I had done the video the other day. Now, me and my community, we had bought it. We knew it was closer to around 35, but there is a potential play in our strategy session today that we found and we actually took the trade if it's something you may be interested in. You go to June of 2027 and you look right here at the $50 strike. This is the one we found today.

[00:08:08]There's 7,000 in open interest and there's quite a bit of volume. So that stands out around anything that's being traded, which means there are a lot of investors that are very bullish on this stock. So if you were to buy one right now, you would pay about $1,300 for it. That's a lot cheaper than actually buying a 100 shares, which would actually put you back about $5,000.

[00:08:32]Let's check in on that trade. Now, the beauty of the timing of that video, it was actually a matter of 24 hours, and that stock Doom did pull back. and you would have been able to get your entry below even what I showed you in the video. And you'd be very pleased with yourself if you actually took it because look, this one that I paid $14 for, it is now valued at $19 in less than a week. This is up 31%. Now, let's look at our expiration date. This one has a lot of room to run. This does not expire until June of 2027. So, I have more than a year for this to mature. I probably will not cash this one in. Let's look at some other trades that I took around the same time. Now, here is another trade on DRAM that I had shown a lot of you when I actually took this trade. This was a little bit less than 10 days ago. And you can see I took a lot of my profit from Palunteer because I had a very low cost basis and I rotated that money into something like DRAM. You can see right here, I invested 75,000 in this ticker and just in a matter of about 10 days, this has appreciated 35%. So, I'm sitting on unrealized gains of about 26,000 at this point. Now, because there's no time decay with this ETF because it's not an option, I will allow these to continue to grow. I do think there's a lot of potential life left in it even if we pull down. Now, if we pull down, I might use some of the profits that I just showed you that I am taking.

[00:10:05]I may rotate that money into an ETF like this to try to gain more exposure at a more blended dynamic with cost. When you see some of your favorite tickers pulled down and have a red day, that's a good time to go ahead and buy more aggressively. you may be on what I call a drip where you're purchasing some every day, but if that one day happens and you have a more dramatic pullback, that's when you would double up because that will lower your average. Now, another way to actually build cash is to sort your positions by total return. And you can determine, do you want to take profit on some of these and leave others to run? So, I can show you this right here. This is my ticker symbol NVTs Navos. It's done wonderfully well. You can see here my average cost was $7.75 and now that's ballooned. It's more than doubled to $18. So when you see something like this, you might consider going ahead and taking profit on at least 25% of your position. And then if you still want exposure to that stock when the market pulls down a little, it probably won't get back to 775, but it might more than likely get down to 12 or even 10. That's when you would take that profit you made in the initial trade and then you'll be able to buy more than what you sold because the price has come down. That's called the core trading method. You keep your core position going but you take the profit from a percentage of your trade and you expand your position. You can see right here AMD same dynamic in this account I have 10 shares of it. My average cost was 252. Now you see it's almost doubled.

[00:11:43]It's at 461. So maybe I will take a couple of shares of AMD and I'll go ahead and cash up and then if AMD pulls back then I can increase my exposure. I might be able to buy another four shares. So if I sold two, got me down to eight, then I buy four more. If it pulls back, that increases my exposure to 12 shares other than the initial 10 that I had. Here you see a similar dynamic with Rocket Lab. So Rocket Lab, I'm holding 50 shares in this account. My average cost was 65. It had a monster run the other day after earnings. So, it's at 106 now. I still think there's a life left in this trade. We have not yet seen the dynamic with SpaceX IPOing and I think that will increase interest in stocks like Rocket Lab. So, this one I may just hold on to or if I'm really nervous about losing some of these gains, I could put a trailing stock on it. Now, here's one I absolutely will want to cash in on. This is the leverage ticker NVDL. Now, I haven't held on to these long, but these leverage tickers, they're not meant to be held on for a long amount of time. You buy them instead of an option because you don't have to deal with aggressive time decay.

[00:12:51]It does decay, but not as aggressively as an option, and you're just wanting to swing trade. This is how I help those in my community that have smaller accounts.

[00:12:59]I teach them how to swing trade, how to automatically set your buy and sell orders. So, this could really be automated, and you don't even have to be watching it all day. But you can see here, I've enjoyed $1,454 in profit in a short amount of time. So, I will more than likely go ahead and cash a 100% of this trade in. That will give me this extra money for other trades that I may want to take. Here's another one I will more than likely cash in on. You see right here, MULL, five shares, average cost of 393, and now in very short order, they have grown to 487. I think this really happened in two days. So, I will more than likely take profit here. You want to get used to taking profit on a regular basis because these stocks that move this much in a day or a week, they give you many opportunities to go in and out of them.

[00:13:48]Now, I'm going to pull this all together for you. Feel free to take screenshots of this if it will help you with your own trading plan. My plan would be to go ahead and close out my skips. Those are my call options that are purchased.

[00:13:58]They're about 3 to six months from expiration. if the RSI on the ticker or the indices is over 70. Now, my leaps, if I have several of them, there's no problem with going ahead and trimming a few of those if that RSI is over 70. On my longerterm leaps, I will leave those to run. Now, they'll have to go through market cycles up and down, but if I believe that the price is going to be much higher a year, a year and a half from now, I don't want to get completely out of all of my leaps. Now, here's what I'm going to do with ticker symbols that are in profit. I like to do the core trading method on some of my positions.

[00:14:36]I may trim some that are in profit only to buy back more when the actual pullback happens. That allows me to use some of the money that I made for the swing trade to actually expand my exposure to that ticker. Now, when it comes to leveraged tickers, I never like to hold those very long. I did a full video that shows you over time how that time decay works. So, because of that, I would like to go ahead and close out all of my leveraged positions if I have seen significant gain in a very short time.

[00:15:07]Now, let's look at sold puts. I didn't actually show you an example of this, but we do have several puts that we sold that are longerdated. Now, those are fine now and they're in great profit.

[00:15:17]Now, if I leave those and the market pulls back, I won't get as much to get out of them. So, I want to go take a look at any of those that are anywhere close to 50% or higher and go ahead and exit those. That will free up the cash.

[00:15:30]Especially if I'm using any kind of margin and the market pulls down and the VIX goes up, then it will take more of my buying power, more of my margin because of that elevated VIX. So, I'll go ahead and use these green moments to get out of those trades in profit. Okay, everybody. I think you have come to see what the key dynamic here is. Balance.

[00:15:51]You never get all in or all out of the market, but it is important to raise cash and to use moments like this. Don't get too greedy. Go ahead and accept some of the good fortune that you've had. Go ahead and cash up and get ready to ride that cycle again. It's the best part about trading. It keeps you active. It keeps your brain sharp. And that repetition is what helps you give you an edge. All of you an edge. And if you're watching this channel, hopefully you are getting that edge. If you want more support daytoday in and out of the markets with so many opportunities to strategize and come up with different ways to make money in different market dynamics, consider joining the inner circle. Remember, if you're with me trading with Ashley, there is no trader left behind. Now, I am going to leave the video for you where I talked about three key ETFs. There's still opportunity in those, especially if we have a pullback. I'm going to leave that for you right