Hey, guys, this past week has been by far the most exciting. The Market presented tons of opportunity which I'll be sharing with you today. Firstly I will go over the trades which I took, and lastly the topic of today. Why so many people are attracted to trading. Good and Bad. Along with the many habits that traders lack, and how to go by correcting them. Let's jump right in. :)
Well as you can see below are the chart of $SHMP. This is what volatility look like. It has been a while since the OTC Market was on fire, but it's back. Big Picture this chart pattern would classify as a Supernova. If you've seen Tim's DVD's you'd know that this is the ideal play we wait for. They don't come around very often, but when they do it's quite the treat. Especially if it's on an OTC exchange, then you have yourself a gem. I will not get into the detail about the fundamental aspects go to this Company, for time sake. But let me say to their PR Writer, good job. I hope you were able to profit or at least learn from this great play. There were multiple angles to play this, and I will share my opinion along with the noise surrounding the stock. ( As I write this I am sitting here @ Texas State. Watching $SOLO make it moves past $3.00. I am tempted too short, but I must be patient. I don't trade Mid-day.) - I will post a chart to see how it goes. ( Executed )
Firstly, let begin with the variables which are essential. We know the following. It's an OTC market play, Supernova, Overextended, it's Price Range, Manipulation, and most importantly Odds. Yes, there I go again. ODDS! I'll go in reverse order. See with OTC plays you know the odds are in your favor. I know the end game. I know this stock will be in the gutter, it's not a question IF, but a question of WHEN. There is no place in Fucking finance that you know the end game. A little side note of you checks out the link above, Tim's latest Interview. It really does aggravate me watching Tim get harassed, as the video shows. In my opinion, everyone has entitled to their own opinion and every one trade their own unique personality. Back to the Topic. Trading as I mentioned is all about Odds and Probabilities. When the Odds are in your favor, ideally you'd bet Big, and they're not it's No Deal. Secondly, the manipulation which is quite the treat. I am sure who was behind the manipulation, but I don't wanna know. All I know is that I want to profit from that manipulation. Penny-Stocks get a bad reputation for being corrupted Yes they are. There's nothing wrong with that it's in their nature. Just understand that each of these companies is destined to fail, yes some may make it. But once again the ODDS favor they will not. So I highly advance to never hold and hope. If so then you are asking for an ugly ending. Side note $SOLO is near my entry zone too short, but I can yet. I don't trade mid-day. Third, the price range is an idea. A couple of days ago I noticed a slight trend in these OTC plays. Most of them up, but get passed the $1 whole mark. Is that a coincidence, I don't think so. Learning something every day is always the goal. What did I learn? That NASDAQ listing requirements must meet over $1. Maybe it's just me, but the past OTC plays those which have been extending beyond its range have been panic before the 1$ mark. Take for instance $ANFI and $SHMP. Of course, it's just a speculation of mine, and again it's not an exact science. To add to that argument Round Numbers tend to act as a magnet for any Ticker. It's like telling that is being pushed, and when it does it blows the top off. Those are personally my opinions about that subject matter. Fourth ties into with the price action. I don't care how well the company is if a Stock is Overextend you are going to get a pullback. And when you don that ideally is a great time to Dip Buy into. I must warn Dip Buying has the built-in risk, and it must be followed unless your hands will get bloody. Typically the pullback is an opportunity for Buyers (dip ) those who miss their initial entry upon the ramp, and Shorts to ideally Cover into. Side note ( I missed my initial short on $SHLDQ. At 2.50 I would have shorted 3703 shares with a risk of day high. I could or should have been up to $2400. It's ok, the pattern will come back because human nature never changes.) Lastly, the pattern is a Gem. This classifies as a Supernova, which I hopefully understand. The one key indicator is the First Red Day. It absolutely works time and time again. Once again it's not an exact science, but it's pretty staggering how it repeats often. I highly encourage you to check out Tim's free Youtube videos on this pattern. Now you know the key Variables, how would you go by playing this trade.
The chart above shows the life span of $SHMP. I will be explaining my view on this particular stock. A little disclaimer I will be doing so in hindsight, which is 20/20. From my standpoint, there are three strategies that you can profit. First, buy the Breakout. Yes, the gimme set up. By far the breakout, in my opinion, is the most reliable. I would not chase this stock as it goes parabolic as it raises your risk. This is kind of an "early bird catches the worm scenario." Never underestimate the power of a breakout as Tim commonly says. For example .35 was a solid breakout too buy, considering the Volume and it, being an OTC which led to a gap-up the following morning. Second would be Dip Buying the Morning Panic. As the chart below represents an example of a morning panic. Now understand that buying the dip has the built-in risk. Understanding that once you enter, your finger better is on the potential sell. Although most often than not a morning panic lead to a bounce, but it's not an exact science. Lastly, Short-Selling is another too profit. It's by far the most risk adverse in my opinion, but with discipline the rewards can be plenty.
Update: This week has been hectic, but I am still here. This post turned out longer than expected, but it was well worth it. In addition, I meant to add another topic to this post, but I will save it for next week. It will be a good one. Well, this upcoming week I get too take 3 Exams, which I'm looking forward too. It has been 206 days since I began my Journey up the mountain. Every day is one more step towards the summit. I finally got my hands on the famous book, which I'll go over soon. I know that I am the only reading this blog. I teach because I get to learn it twice. Have a great week ! Live, Love, Matter. For Y'all