Penny stocking 1 DVD Notes
They have few fundaments. Trust No one – especially management.
The Basic to know and rules:
- It’s all in the stock charts – learn how to technical analysis and reading price action and level 2 action.
- Learn about the company – premarket research and news catallus
- Keep it simple – use few indicators, don’t complicate things when charting.
- Penny stalking – play what’s hot only. Price actions that is hitting scans and do your watch list.
- Do not discriminate – be willing to play anything, so long it is hot.
- Aim to profit: 20 cent – $1 per share and move on. Very important. This is not investing
- Be willing to go LONG and SHORT at all times. This is the goal.
- USE CANDLE STICKS charts only, nothing else matters – read candle stick books - important
- Don’t Diversified and be thorough and Be conservative – do not risk high amount until comfortable and experience.
- Take 1 to 2 positon at a time – always monitor your position, Always monitor the news
- Take losses quickly- no matter what. Protect your gains
- 90% traders loss money and give up- don’t be that – protect your capital. Okay to burn commissions and not loss capital amounts.
- Do not trade before earnings- wait for it to come out.
- Follow your stocks
Penny stocking/ low cap NASDAQ’s companies have:
- No revenue to little
- NO profits to little
- Have Huge losses
- No capital
- Failure rate is high, success rate is low.
- Stock price between 5 cent and $10
- We take advantage of failures and the hype creation through the volatility it creates.
- Under 250 mil in market cap
- Listed on Nasdaq, AMEX and OTCBB and Pinksheets
- Extremely violate
Equation: great volatility + little liquidity = Massive problem
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Great Volatility |
Little liquidity |
Massive problem |
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News=catalyst |
Dollar volume trade is musicule |
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20 – 300% intraday
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10 and 100K shares per day typical, but when 1 mill is traded |
shorts |
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Fall to 10-40% and halts
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Trade volume creates price spikes |
time |
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Large intraday peaks and valleys |
Learn to find shares to short |
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Lack of large players + Gross Manipulation= Massive Opportunity
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Large players |
Gross Manipualtion |
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New suckers all the time |
Hype: Press realeases, spam, stock promoters, newsletter and message boards, chat rooms, boiler rooms creates hype. |
Helpful for trading purposes – it’s predictable |
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Little money are long shots. Amateurs lose betting on long – learn |
Hype influences amatuers |
It’;s effect are predictable |
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Large traders uninterested. |
Coordinated bying after the hype creates further buying |
Patterns allows for repetitive profits |
How to find trading opportunities:
- % gainers
- High volume stocks
- Scans and Research
- History learns – learn from history lessons.
- Scans
Corporate Events (that can influent the stock price)
Planned
· Earnings
· Feature appearances
· Analyst days
· Conference call
Unplanned
- Newsletter and recommendations
- SEC filling /halts
- Management changes
- Analyst Coverage
- Patents / Lawsuits/ FDA approvals
- Index add -Russel 2000 funds
Price are based on expectation, hence cheap:
- That is why the companies pump:
- To attract investor, for funding, generate hype through news.
- Stock Prices moves quickly. Intra minute, day and week and months
- Always monitor the overall market – 3 out for 4 stocks following the overall market and index – SPY, NASDAQ, Russell 2000 etc.
- Takes your loss quickly. Never allow trade to go against you.
How to make money (What to trade):
- Long side (bullish factors): going long- momentum trading.
- Earnings and contracts. Positive revenue and earning growths- right direction
- Financing – proves the company attracting investors
- Partnerships – enterprise are loving what the company doing.
- Institutional investors
- Well known investors
- Surf the price momentum
- Get out when trend changes
- Technical events ( Long set up Plays on stock price and chart) – what to look for:
- Intraday Breakout
- 52 week Highs
- Higher Highs
- Increase in volume
- Short squeezes
- Ability to break resistance and hold support
- All the above generate interest for momentum trading
- Short side (Bearish Factors) – for Shorting or warning to getting out of long positions.
- Earning s and contract – negative or stagnant revenues
- Financing: destru
hey the charts would not load is there a way you could email this to me with the charts i would love to go over this
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