11 September 2015

$VVUS moving

Well it took a bit longer than I hoped but billionaire play $VVUS is finally spiking, having reached $1.72 this morning. Sometimes with these penny stocks it takes forever for the news to finally reach the masses it seems.

Anyway, not a bad trade if you bought off the lows the other day in the 1.35-1.38 area. My average was $1.41. I still think it has a ways to go considering how many shorts are in this stock. The real move is to $2+. I wouldn't buy any parabolic move today. If it moves like that I'll sell into strength. I'm not sure we'll see $2+ today but I believe it's on the horizon. Dips back to the low 1.60s are possible buys for me.

09 September 2015

The "all or nothing" market

That's what some have called it the past few weeks. The stock market has been characterized by whipsaws back and forth with 80% of stocks following the daily trend, up or down. Today was no different. After a huge overnight rally overseas, the futures markets were up about 1% pre-market. (That on the heels of a solid 2.5% gain on Tuesday). The market held those early gains somewhat but then finally let go after lunch, accelerating quickly downward into the close.

Given the conditions, today was a rough day to trade after the initial morning rush. There were some great trades though. $VTAE was a huge winner on Phase I drug trial news. It even staged a late day sell-off and rally all in the matter of about 20 minutes. Crazy price action on this one. It actually traded back up to $15.30 in after hours. The stock finished strong -- up more than 80% -- but with the markets looking weak into tomorrow morning this one should see a gap down before moving higher.

With respect to $VTAE, the RSI is off the charts and the stock is currently selling about 80 cents/share over VWAP so it's definitely due for a pull-back and some consolidation. If you plan to trade this one long wait for a wash out back to the 14.40-14.50 range. If it holds and consolidates there, that would be a nice entry. Any entry over $15 is really pushing your luck.

On the other side of the coin, if you can catch a nice short entry at pre-market (BEFORE it pulls back and consolidates) near 15.20-15.30 you could have a nice trade with a potential for 50-75 cents/share in profits.

My other primary watch tomorrow is $VVUS. $VVUS is a "billionaire play" now that Carl Icahn has taken an interest. It doesn't have a low float but it does have incredibly high short interest. If this thing gets some volume, many shorts will be trapped and this thing goes over $2/share easy. There's also evidence of call options being bought up with the strike at 2. Today it was only good for a morning gap and crap. However, given the catalysts, this stock is still one to watch for the next few days. Again, it will need significant volume, otherwise it may just trade sideways. There are many bagholders in this one.

Finally, If you haven't checked them out yet, my friends at Profitly are having their annual back-to-school sale on newsletters, DVDs and chat rooms. Check out this link to get up to 60% off. Hurry up though, this offer won't last long.

08 September 2015

Watchlist for Wednesday, 9 Sept 2015

Primary long watches but no bias at the open, will watch and react as the price action dictates.

$OHRP, $ITEK, $EXEL and $SUNE are all potential longs if there's sufficient volume and trend.

$TVIX was a great short today with the market surging this afternoon and into the after hours. However, if there's a trend reversal or profit taking tomorrow the $TVIX could make a quick recovery. No bias yet. Will watch to see what the S&P does.

$ICLD has been popping but I don't care for it. It has tons of bagholders. $GEVO has also been a common fakeout with moves to 2.70s and then slap back down.

$ACLS is a potential breakout. $MPO had a huge move today, will watch oil tomorrow for potential trade again.

Overall the market could continue to rally. The S&P futures have held thus far in after hours. Even if we get a small pop again tomorrow however I expect more choppiness and volatility in the near term. Afterall, it's September, one of the worst months historically for the market and the bull market is a bit long in the tooth. It's a great time to stay in cash overnight.

Markets rally, great day to be long

One classic rule in stock market trading is: Don't fight the market. Today was one of those days. With the S&P surging to the close today, shorts were getting squeezed left and right. Consequently, I only had one short trade today on $OHRP and that was after I traded it long at the market outset. $OHRP is a former runner that traded twice its normal volume, finishing up nearly 19% on the day. With the market rebounding nicely, $OHRP could run again tomorrow as well.

The big gap play winners this morning were $MPO, $CAPN and $VLTC. All three had impressive moves today. $VLTC pulled back after climbing over $8 -- as is typical. $MPO ran very strong from the $5s to the $7s on a rebound in oil and was a nice $1 + per share play on the long side. $CAPN is a low floater that trades well when it has volume but can also dropped sharply once the momentum is gone.

$ARIA traded very choppy on the day, mostly down and then recovered near the market close around $8. One of my key watches, $AVXL started the day strong topping over $1.40 but then pulled back considerably and ended up mostly flat on the day. $ACI, after a nice run last week, came crashing down today losing nearly 30% of its previous gains.

With the market finishing so strong today I'm expect a bit of a pull tomorrow on some profit taking. Overall there's still considerable volatility in the market which makes trading and shorting $TVIX a good option on days like this.

07 September 2015

Watchlist for Tuesday, Sept. 8, 2015

Top Watches

No, initial long or short bias on these, will react to p/m price action Tuesday morning or continued trend from Friday's close.

$KBIO -- trend continuation or support break and fade back/retrace; if it gets volume could push and retest $4.50 - $5. If it opens weak could fade back down quickly below $4. Pre-market should be key on this one.

$AVXL -- continuation of Friday's upward trend reversal, strong close on Friday, looking for pop back over $1.50/sh

$TRVN -- possible push back over $11, or if market opens weak retrace to 10.50 and fades all day

$ARIA -- nice push back since last Wednesday's washout, with volume should continue trend, finished up nearly 40 cents on Friday. Strong finish.

$ITEK -- has been finding support in the $12s, could see a nice bounce on volume. This one trades very choppy though and recent pops have not held well so be careful.

Secondary Watches

$OMER -- keeps failing to bounce back, ideally finds support this week and pops $1-$2/share
$VLTC -- had a nice bounce last week, with volume can pop again, if not likely just fades back again
$MPO -- if oil is strong again this could be a great trade on Tuesday, has held recent upward move very well.
$RJET -- stock moves on news, more likely bad news than good. Be careful with this one. Plenty of volume, once trend develops could be a nice 50 cent to $1 move.

Helpful tools for active traders

As a daytrader you need every edge you can get. After all, 90% or more of active traders lose money. Moreover, most traders give up, not because they don't like trading, but because one or two large losses leave them discouraged or with a "blown up" account.

That said, here are a few sites that I have found to be helpful when researching stocks or finding possible trades.

Microcap Research is a great minimalistic web site that offers a quick search bar tool that will give you all the information you need on any given microcap stock, e.g. short interest, charts, headlines, Twitter mentions etc.

Profitly is a helpful community of active traders who post their trades in a transparent way for all to see. On this site you can track your trades and profits. For the serious trading nerd they also offer some plans that will allow you to go in the weeds on your own trading statistics. I've used this myself to analyze my own trades and avoid repeating mistakes.

GreatStockPix TV posts his daily video watchlists, 100% FREE! Best of all GSP is a successful, proven trader who puts risk management first. You won't find any gunslinging in his advice. Many of his free watchlists have helped me find good plays.

NewTraderU is a very helpful site for both new and veteran traders. Operated by Steve Burns, an accomplished author and swing trader, the site covers some classic trading rules and technical analysis as well as trading psychology. Definitely worth bookmarking and totally free.

Other great tools:

High Short Interest Stocks can be a great way to find stocks that have potential for a Friday afternoon squeeze or just to confirm significant short interest in a stock. Keep in mind that short interest is NOT updated daily or even weekly so, grain of salt.

Pre-Market Movers

After-Hours Most Active

Insider buying reports

Stockcharts is a nice free charting and scanning website. They do offer premium accounts as well. Offers some decent free scanning.

FinViz is great for NASDAQs but not penny stocks. They also have a paid service. Basic service is free.

SEC Filings is essential for checking on penny stocks and pump n dumps.

Upcoming IPOs is useful because IPOs can be very volatile and high volume in their first few weeks/months which means an opportunity to make money for day traders.

Earnings Calendar comes in handy to make sure you're not swing trading or holding a stock through earnings; also good for checking the consensus on a stock's upcoming earnings announcement.

PennyStock Newsletters a great little database of current penny stock promotions

and finally my favorite newsletters and trading chat rooms

Fewer trades often lead to better success

I really want to improve as a trader, so I'm always analyzing my trading strategy and my recent trades. One recent review of my own trades makes it clear that more trading does NOT necessarily mean more success or more money.
Looking back week-by-week, it's apparent that any successes I had really came down to just 1 or 2 great trades each week. The rest of my trades end up being scratch or just a few hundred dollars in profit (for lots of time and effort).
I believe more than ever -- after evaluating my own trading -- that it really does pay to just wait for the very best setups each week. For one, it saves you a lot heartache and wasted time. Secondly, it keeps you focused on winning strategies -- rather than boredom or "forced" trading.
Moreover, I have found each week there's usually at least one time where I missed out on a better trade because I had my money tied up in a boring trade that really wasn't worthwhile. This is what economists call "opportunity cost." By choosing to be in one trade I lose the opportunity to potentially be in a more profitable one.
This past week I really slowed things down. I didn't trade Monday or Tuesday. Just watched. I did two swing trades on Wednesday and three day trades Friday. As a result, my overall profit was lower but I also took on much less risk, didn't use margin, and I didn't have any large losses. I also finished the week in cash. I've noticed that when I close out each day or week in cash (no overnight holds), I tend to do much better and I tend to be much more positive and focused the following morning.