COIN.US Amazon - Trade Plan — 2026-05-07

TL;DR

Long COIN equity (not options — IV at the 78th percentile and a 26pp backwardated term structure make naked long calls structurally expensive and bull-call spreads are unnecessary at this size). Scale-in: half (8 shares) at the current $192.96 close, half (7 shares) on a re-test of $190.00 — blended entry $191.48. Hard stop $177.62 (Apr-29 swing low, technician's level), first target $213.50 (double-bottom neckline), stretch $268.54 (pattern projection on confirmed neckline break ≥1.5× volume). Horizon 42 trading days (~2 months) — long enough for the macro/BTC channel to transmit and Q2 print to land (mid-to-late July), short enough to cap regulatory-binary tail. Size 2.87% of NAV (15 shares, $2,872, $208 risk = 0.21% NAV) — well below the 3.5% neutral default and below AMZ.US's 3.5% / MBG.DE's 3.0% first-call precedents, honouring conviction 2 + first-call cap + RICH-IV caution + system bias against aggressive sizing.

Source verdict

LONG, conviction 2 (capped at 4 for first call per memory; the underlying signal does not warrant 3 or higher independently). The bull case won on three engaged points — quantified macro/BTC tailwind, completed double-bottom structure, and a Q2 QTD sequential acceleration the bear miscalled as "flat." [...] This is a directional LONG, not a HEDGED-LONG, despite the macro analyst's BTC-leverage hedge flag. The thesis is that the BTC tailwind transmits — hedging it out converts the position to a near-neutral idiosyncratic bet that the fundamentals analysis says is unattractive at 57.8x forward.

— research-verdict.md, decision: LONG, conviction: 2

I take this as given and do not re-litigate the directional call, the hedge decision, or the conviction level. My job is execution.

Direction & instrument

LONG equity (cash shares of COIN). No options structure, no paired hedge.

Rationale for equity over structured options:

1. IV is RICH. IV30 = 76.7%, 78th percentile, +12.8pp premium over HV20 (options-flow.md, "IV Regime"). Buying naked calls pays a 12.8pp annualised vol premium that the stock must out-run before the trade breaks even on a theta-neutral basis.
2. Term structure is in steep backwardation. Near-term IV (94.4% at 7dte) runs 25.9pp above 70-dte IV (68.5%) with no identifiable scheduled catalyst (options-flow.md, "Term Structure"). Long short-dated options bleed fastest in backwardation; long longer-dated options pay less but still carry the regime premium.
3. Position is small (2.87% NAV). The capital efficiency of options leverage is not needed at this size; equity is the structurally cleanest expression and the options-flow analyst explicitly states this: "Outright equity (long shares) avoids the IV premium problem entirely and is the structurally cleanest expression in an elevated-IV environment" (options-flow.md, "Trade-Structure Implication").
4. Bull-call spread alternative considered and rejected. A $195 / $220 June 18 debit vertical would recover some IV premium on the short leg (call wing IV elevated), but at 2.87% notional NAV the absolute premium savings are small relative to the operational complexity, gamma sensitivity in a negative- GEX environment, and the difficulty of sizing a defined-risk structure to the same dollar-risk budget. Equity wins on simplicity for this size.

Per the research-verdict, the BTC-leverage hedge flag from the macro-factor analyst is not actioned. The thesis is BTC transmission; hedging it out negates the thesis. (Risk committee can revisit; that is a sizing/risk decision, not mine.)

Entry

• Method: scaled (two-leg)
• Leg 1: Buy 8 shares at $192.96 (limit, day GTC)
• Leg 2: Buy 7 shares at $190.00 (limit, GTC, working)
• Blended entry: $191.48
• Validity: GTC on both legs through 5 trading sessions; if leg 2 has not filled by 2026-05-15 close, cancel and accept the higher cost basis — do not chase the leg 2 fill.

Why scaled, not limit-at-$190 or market-at-$192.96:

• The bull's round-2 tactical concession is exactly a scale-in at these two levels: "scale-in half at $192.96, half on a re-test of $190 (per round 1)" (debate/round-2-bull.md, "Update to my position"). Honouring it.
• The technical-analyst's "WAIT FOR PULLBACK" verdict puts the entry zone at $188–$192 (technical.md, "Timing View"). A pure limit at $190 risks no fill if the BB-width compression (0.352 → 0.220) resolves upward through the $213.50 neckline without re-test. A pure market-at-$192.96 chases price into the $197.37 HVN ceiling only $4.41 above and degrades R/R from 1.90× to 1.34× to the first target.
• The scaled entry is the compromise: honours the bull's tactical view while keeping the bear's chase-risk concern in check.

Honest note on R/R degradation at $192.96: The research-verdict's critical assumption #4 explicitly flags this: "At $192.96 R/R degrades from 1.90× to 1.34× to first target." The leg-1 fill at $192.96 carries 1.34× R/R; the leg-2 fill at $190 restores R/R to 1.69× ($23.50 reward / $12.38 risk). Blended 1.59×. This is below the skill's "no targets implying > 3:1 reward:risk" prudence rule (we are well under, not over) but the 1.34× on the chase leg is the worst-case price the trade is willing to pay for partial entry. Accept it because (a) the bull's argument that the macro contribution does not need to be the full +27.7% to clear the stop distance survives at this R/R, and (b) the asymmetric stretch target ($268.54, R/R 6.34× from $190 entry) provides genuine optionality on a confirmed neckline break.

Stop

• Price: $177.62
• Type: hard stop on daily close
• Justification:
  • Apr-29 swing low (technician's most recent confirmed support, technical.md, "Cross-referenced levels")
  • Distance from blended entry: $191.48 − $177.62 = $13.86 (7.24%)
  • Validates against vol noise: ATR(14) = $10.63 (5.5% of price); 1.5× ATR = $15.95 — stop distance of $13.86 is below 1.5× ATR on raw distance, BUT the stop is anchored to a structural pivot, not to a vol multiple. Snapping to the pivot is the technician's framework; accepted.
  • Validates against worst-plausible drawdown from macro view: macro-analyst flags BTC-channel tail risk on -20% IBIT move = -21.2% COIN (macro-factor.md, "Hedge Flag"). The stop at -7.24% from blended entry will be hit well inside that scenario, capping single-trade loss at $208 (0.21% NAV) before the macro tail materialises.
• Daily-close discipline: Intraday print of $177.62 does not trigger if the close recovers above. This is intentional given COIN's elevated daily ATR (5.5%) and negative dealer GEX (-$22M) which amplifies intraday moves. A daily close below $177.62 invalidates the bottoming regime per technical.md ("What Would Invalidate This View" #1).

Targets

First target (TP1): $213.50

• Double-bottom neckline (swing highs of 2026-03-05 and 2026-03-17, with secondary confirmation at $216.05 on 2026-04-17). technical.md, "Pattern" and "Cross-referenced levels."
• Reward from blended $191.48 entry: $22.02 (11.50%)
• R/R from blended: 1.59×. From leg-1 $192.96: 1.34×. From leg-2 $190.00: 1.90×.
• Trim 50% of position on first daily close ≥ $213.50.

Second target (TP2 / stretch): $268.54

• Cup-and-handle/double-bottom measured-move projection: depth ($213.50 − $158.46 = $55.04) + neckline = $268.54. technical.md, "Pattern: measured target on breakout."
• Aligns with HVN cluster at $252–$258 (volume profile resistance, technical.md, "Method 2: Volume profile").
• Reward from blended $191.48 entry: $77.06 (40.24%)
• R/R from blended: 5.56×. This is high but legitimate — the pattern projection is mechanical, not aspirational, and the HVN cluster confirms the target zone. Not a "prayer."
• Pre-condition for engaging TP2: TP2 only unlocks if the $213.50 neckline is broken on a daily close ≥ 1.5× the 50-day average volume (technical.md, "Volume" — neckline break on below-average volume is suspect; system requires 1.5–2× confirmation).

Trail rule

• After TP1 fills (50% trim at $213.50): raise stop on remaining 50% to $190.00 (leg-2 entry / break-even on the average cost). Removes structural-loss risk; lets the runner test TP2.
• If $213.50 neckline breaks on volume <1.5× the 50-day average: exit the entire remaining runner at $213.50 — do not hold for TP2 on weak-volume break (technician's specific guidance).
• If price reaches $260 area (within $9 of stretch target) without triggering the stop: tighten trail to the prior 5-day low. The HVN at $252–$258 is heavy supply; expect chop in the target zone.

Horizon

42 trading days (~2 calendar months), through 2026-07-08.

Default trader-skill horizon is 21 trading days; extended to 42 because:

1. Pattern thesis needs time. A 75%-formed double-bottom that needs to break a neckline 10.7% above current spot is not a 21-day move in a stock that has been range-bound between $177–$216 for several weeks with BB-width contracting. The technician's regime tag is "bottoming" with ADX 17.26 (no established trend) — these regimes resolve on weeks, not days.
2. Q2 transaction-revenue confirmation requires the Q2 print. The research-verdict's critical-assumption #2 anchors on transaction revenue tracking ≥$215M-through-May-5 pace. The Q2 earnings release is "mid-to-late July" per news.md ("Catalyst calendar"). Closing the trade before that print means the macro-channel thesis pays only on price, not on the confirming fundamental data.
3. Bounded by next FOMC cycle. FOMC June 16-17 (with SEP) and July 28-29 fall inside the horizon (news.md catalyst calendar). Both are accepted as gap-risk events; neither is COIN-specific.

Catalyst overlay (events inside the horizon):

Why hold through Q2 earnings rather than exit pre-print: The research thesis is that Q2 transaction revenue is sequentially re-accelerating (+13.8% Q/Q at the May-5 run-rate). Exiting pre-print means the trade pays only on price — it never collects the fundamental confirmation that the thesis depends on. Position is sized small enough (2.87% NAV, 0.21% NAV at risk) that the gap risk on Q2 print is bounded. If COIN gaps -20% on a Q2 miss, absolute loss is ~$574 (0.57% NAV) — an over-stop loss tail of 0.36% NAV beyond the structural risk. Acceptable at this sizing.

Size

sizing:
  method_used: min_of_methods
  size_pct: 2.87
  shares: 15
  notional: 2872.20
  risk_dollars: 207.90
  risk_pct_nav: 0.21
  conviction: 2
  rationale: >
    Fixed-fractional with conviction 2 (0.25% NAV at risk) on a
    $13.86/share stop yields 18 shares = 3.45% NAV. Vol-targeted at
    HV20 = 63.9% (daily vol 4.03%) targets 4.96% NAV. Quarter-Kelly
    (p_win 0.50, R/R 1.59) = 4.65%. Min of methods = 3.45%
    (fixed-fractional). Then trimmed further to 2.87% NAV / 15
    shares to honour: (a) first-call discipline — AMZ.US sized at
    3.5% and MBG.DE at 3.0%, both at higher conviction (3 and 4
    respectively); a conviction-2 first call should sit below
    MBG.DE; (b) memory's explicit "system bias has been declining
    aggressive sizing" note; (c) RICH-IV / negative-GEX environment
    increases realised-vol-amplification risk; (d) BTC-leveraged
    exposure (1.06 IBIT beta) means the position carries more
    factor risk per dollar than a typical equity. Round-lot
    rounding from 18 → 15 shares.
  alternatives:
    fixed_fractional_pct: 3.45
    vol_targeted_pct: 4.96
    kelly_quarter_pct: 4.65
    parity_pct: null
  caps_checked:
    single_position: 10.0       # 2.87 << 10.0 OK
    single_loss: 1.0            # 0.21 << 1.0 OK
    sector: 35.0                # n/a — no current crypto/financials sector exposure
    correlation: 25.0           # n/a — first position
    liquidity: 1_day            # 15 shares of a US-listed mega-liquid name; trivially clears

Order ticket summary:

Critical assumptions

These are the inputs the trade depends on; if any breaks, the trade is wrong (not just unlucky):

1. BTC (IBIT) holds above $40 over the trade horizon. Below $40 the dominant 1.06-beta factor flips from tailwind to headwind. (research-verdict.md assumption #1; macro-factor.md "What would change this view" #1.)
2. Q2 2026 transaction-revenue run-rate continues at or above the $215M-through-May-5 pace. A May-to-June deceleration below this pace flips the trade to NO-TRADE. (research-verdict.md assumption #2.)
3. No new SEC/CFTC enforcement action lands in the holding window. Regulatory binary risk is unscheduled by nature; the 60-day lookback is clean and the SEC suit was withdrawn, but this is a tail.
4. Subscription/services revenue line ($584M in Q1 2026) does not break sub-$500M. The "defensible 44%" thesis depends on the annuity component holding. (research-verdict.md assumption #5.)
5. Idiosyncratic residual does not extend. The bull's case that the -16.5% 21-day idiosyncratic drag is "in the print" at $192.96 is the load-bearing rebuttal to the bear's macro de-rate from +27.7% to ~+11%. If COIN continues to underperform its macro factors by >5% over the next 21 days, the bear's structural-residual reading is winning and the trade is exhausting its margin of safety. (debate/round-2-bull.md "Why it's wrong / overstated.")
6. Entry discipline is honoured. The bull's scale-in at $192.96 / $190.00 (not a market chase) is a condition of the trade, not a preference. If leg 2 does not fill within 5 sessions, the position runs as 8 shares at $192.96 with R/R 1.34× and tighter trail discipline.

Thesis-invalidating events

Specific events that, if they occur, mean exit immediately regardless of price level:

1. IBIT closes below $40. Hard exit, full position. Macro regime flips from BULL_RECOVERY to BEAR_CONTINUATION; the dominant factor that drives 63.3% of COIN return variance has reversed. Don't wait for $177.62 to confirm.
2. New SEC or CFTC enforcement action filed against COIN, or a credible Wells Notice. Unscheduled regulatory binary; this is the risk memory.md called out for COIN specifically. The stop at $177.62 catches a -7.24% drift; a regulatory gap would blow through it. Exit on the news, not on the next stop fill.
3. Q2 management update implying QTD transaction revenue below the May-5 $215M pace (i.e., May-to-June decelerating month-over-month). Flips the sequential-acceleration thesis. (debate/round-2-bull.md "Where I'd concede.")
4. Daily close above $216.05 on volume <1.5× the 50-day average. Neckline break on weak volume is a fake-out signature; trim aggressively at the breakout level rather than trail through to TP2. (technical.md "What Would Invalidate This View" #2.)
5. OTM put volume at $160–$170 strikes accelerates to ≥15,000 contracts/session for 2+ sessions. Options-flow analyst flags this as the threshold separating retail downside speculation from institutional hedging (options-flow.md, "What Would Change This View" #6). Institutional hedging into a long thesis is a credible counter-signal.
6. VIX spike to >30 (VXX +40%+ from current). Macro analyst flags this as a regime change to RISK_OFF; COIN's VXX beta of -0.49 means a -14.7% headwind on a 30-point VIX print, which stacks adversely with any BTC weakness. Exit on regime change, not on stop.

What I'm explicitly not doing

1. Not hedging the BTC beta. Macro-factor analyst flagged the 1.06 IBIT beta as a hedge candidate; research-verdict explicitly declined the hedge ("the thesis is that the BTC tailwind transmits — hedging it out converts the position to a near-neutral idiosyncratic bet that the fundamentals analysis says is unattractive at 57.8x forward"). The risk committee may override; that is their prerogative, not mine.
2. Not using options for leverage. RICH IV (78%-ile, +12.8pp over HV20) plus 25.9pp backwardation makes long-options structurally expensive; the trade-structure implication (options-flow.md) explicitly recommends equity at this regime. Bull-call spread considered and rejected on size grounds.
3. Not chasing if leg 2 misses. If $190 doesn't print within 5 sessions, the position runs as 8 shares (1.55% NAV) with 1.34× R/R and unchanged stop. Better an under-sized position than a chased one — this is the AMZ.US first-call precedent (declined to chase at $273.55 vs $251 entry zone; memory.md).
4. Not sizing up on a confirmed neckline break. Breakout confirmation above $216.05 on ≥1.5× volume is the technician's alternative entry, but pyramiding into the same idea raises correlation-of-position risk in a way the first-call discipline should not accept. If the breakout confirms, the trade pays on the existing 15 shares; do not add.
5. Not exiting before Q2 earnings to avoid gap risk. The thesis depends on Q2 confirming sequential acceleration; sidestepping the print would be sidestepping the trade. Sized small enough (2.87% NAV) that gap risk is bounded.

What would change my mind

The trade-plan is operational; the thesis changes are listed in "Thesis-invalidating events" above. Two further trade-plan-level changes that would make me rewrite this plan rather than execute it:

• Risk committee binds a smaller size. If the conservative voice argues for ≤2.0% NAV given the BTC-leveraged exposure plus the conviction-2 first-call combination, accept it without pushback. The structural argument for trimming is stronger than the structural argument for the current 2.87%.
• Risk committee insists on the 0.5×-IBIT partial hedge. The macro analyst's stated alternative converts the position from a leveraged BTC bet to a roughly market-rate BTC exposure. If imposed, it changes the trade economics (small short cost, beta reduction) but does not invalidate the structural plan. Accept with revised P&L attribution.