Sometimes the market rewards you for being stubborn. Other times, it rewards you for being flexible.
This $NBIS trade? It rewarded me for being both.
Let me walk you through what turned into one of those textbook examples of why having a plan matters—and why knowing when to deviate from that plan matters even more.
Back on July 2nd, I published a trade idea on $NBIS: a September 50/80 bull call spread for $6.80. The math was straightforward. My profit target was $24 (the spread could theoretically be worth $30 max), which would deliver a solid return if everything went according to plan.
Spoiler alert: things didn't go according to plan. At least not initially.
Right out of the gate, this position went underwater faster than a lead balloon. We're talking immediate regret territory—the kind of start that makes you question your analysis and wonder if you should just cut your losses and move on. That's red circle number one on the chart, where lesser conviction might have bailed.
But here's the thing: I had done my homework on July 2nd. I believed in the setup. I had sized the position appropriately for the risk. And most importantly, I had a plan that accounted for this exact scenario.
So I held.
Patience paid off. The stock eventually found its footing and started climbing. Then it really started climbing. Before long, I was sitting on solid gains, watching the position move toward my $24 profit target.
But then came test number two.
Just as things were looking good, NBIS threatened to break support. Red circle number two on the chart—another moment where the easy move would've been to lock in profits and walk away. After all, I was already ahead. Why risk giving it back?
Again, I stuck to my plan. The setup was still intact. The thesis hadn't changed. And defined-risk trades like this one are designed to withstand exactly these kinds of temporary setbacks.
Fast forward to the real plot twist: NBIS gapped higher overnight on news, sending the stock up 50% in a single session. Suddenly, my September 50/80 bull call spread wasn't just hitting my $24 target—it was blowing past it.
This is where the art of trading kicks in.
I had a standing order to sell at $24. That was the plan. But when I saw that gap opening, I made a judgment call. I canceled that order and worked my own exit, ultimately closing the position for $28 a few minutes after the opening bell.
The difference between $24 and $28 might not sound massive, but on this trade, it represented a meaningful increase in my net return. More importantly, it illustrated something crucial about successful trading: knowing when to follow the plan and when to introduce flexibility.
Two key moments tested my resolve to stick with the original plan—both times when things looked dicey. But when opportunity presented itself to exceed my original profit target, I was flexible enough to adapt.
This isn't about being greedy or getting lucky. It's about understanding the difference between discipline and rigidity. Discipline kept me in the trade when it was losing. Discipline kept me positioned when it threatened to give back gains. But flexibility allowed me to maximize the outcome when the setup delivered more than expected.
The secret sauce isn't just having a plan—though that's absolutely essential. It's knowing when that plan should be your north star and when market conditions are telling you there's an even better path forward.
Sometimes the market rewards you for being stubborn about your convictions.
And sometimes it rewards you for being smart about your exits.
The trick is knowing which moment calls for which approach.
Sean McLaughlin | Chief Options Strategist, All Star Charts
