I have developed a process that seems to work for me and thought I would share it with you. I am working with a 2K account and can't afford anything expensive and don't have the cash to make a short worth while, so I can only do longs right now. Basically, this is what I am doing and comments are very welcome.

First I need to find a target. I use the Profit.ly watch lists, Tim's chat room watches, the highest % gainers for NASDAQ pre-trading and the highest % gainers for OTCBB to find them.

I next look at the prices, the volume, and the 10 day average volume. I need something that is between $0.50 and $7.00. That way I stand to make a better percentage. The trades and volume needs to be good in order to be able to easily buy and sell.

I then look at the charts or morning data to see if it spiking up. If it is, I look to see if this is the first day of the spike and if the stock has been relatively flat before hand, for days or weeks. If it is, "WHY" is the important question. I then research the news and their website to see why it is spiking. I stay away from the pumps, but if I like what I see (up-listing, buy recommendations , earnings winner, tv spots, new funding, etc...), I then need to determine if it has a lot of room to grow. I use 6 month and 1 & 3 year charts to see what it did prior. If it has multi day runs and near the bottom, my interest is high then.

This whole process only takes me about 5 minutes per symbol. When I find a few symbols I like, I spend a while really going back through the research to pick the best one for me. Because I am very new, I only want to concentrate on one at time for now.

Before using this process, I had one $6 winner and 4 losses. Since I started this, I have 3 winners in a row. I am going on the theory that with a good catalyst, a good stock can keep rising for a day or two because, once investors see a new high from yesterday, they buy in hopes it will go up again and I can profit from that. My trick is to try to get in on day one, ride the spike the next day, then sell it.

Please, I welcome positive and negative comments. As I am new, everything can be useful to me.

 

Make money and have fun,

Bob