Hey there, I hope you had a wonderful past week. Another week in the Books! 82 Weeks and I am still in the game. Today I will be going over where I am in my Trading process. As well below will be some videos fro this previous week. With stock analysis with $VTVT and $GNPX. As of right now, I have two brokerage account open. Etrade and TD Ameritrade, This will give me the flexibility to take 9-day trades within a 5-day rolling period. Once more the goal is NOT to trade often but too trade well. I will not be over trading. I don’t have to trade every day, yes I show up. Like any business, the doors will be open for opportunity. My job as a trader is to wait for the A+ Set-Ups and then strike with conviction. I speculate, not anticipate. I don’t try to predict, I am reactive. Below will be a section from Week 74 and Beyond.
My Trading Process: Below I am going to describe what I look for when to enter a stock. Again note that Trading is not an Exact Science, what works for me may not work for you! It's more of the guideline! Again take it as you will and try to gain something from it. I will see you soon!
1) Focus on Big % Gainers: This one should the obvious one! I know too many people that focus on non-volatile stocks! And it blows my fuck-en mind. Understand that you need Volatile stocks, yes they are riskier than your higher blue-chip stocks, but again the higher the risk, the greater rewards. Understand that trying to grow small accounts with Blue Chip stocks is going to be more difficult. Focus on the Big % Gainers. And no excuses, People always say I don't have access to the Big % Gainers. That's Bullshit! It's called fuck-en Internet! Yes, having platforms like StockstoTrade or Equity Feed gives you an edge over others, but it comes at a cost. Again ask yourselves, are you going to treat this like a Business or a Hobby! 90-95% of traders try to be coupon clippers. Fuck that! It's all Market Tuition! If you are cheap and don't have anything, there is still plenty of sites that give you the big Percent Gainers. Such and Yahoo Finance, or Finviz.
2) Focus on Tickers that find your Niche as a Trader: Once you find the Big % gains, understand that you don't have to trade all of them. I'm not saying you can't, but in my opinion, prefer to select the one with the highest odds. Again Trading is a unique industry, cause what works for me may NOT work for you! It's not a direct cause and effect. Don't play follow the leader mentality! Focus on you. I know that in every begging you may not know what your set-ups are, but that is why I an advocate for paper trading. Test and refine overtime in pretty of success.
3) Put the stock into the Overall context: When I see a stock that interests me, I take the overall context. Why, How What. I want to get the overall sentiment of the stock. Again I focus on the TICKER NOT THE COMPANY. Nate said it best "Trade the Ticker". I am not saying to ignore the fundamentals, because that does matter, but again PRICES MOVE BEFORE FUNDAMENTALS...PRICE ACTION IS KING. Firstly I look at the Chart, Look left to predict the right as Nate would say. At least I go back 1 year, the main thing I am asking myself is "Has this Stock ran in the Past." You must always respect former runners, they can always run again, it's in their DNA. As well as volume and how the Trend has been up to the time looking at it. The Chart is not everything but is a major factor, it's Pattern Recognition. Secondly, I ask Why is this stock up? Again I don't primarily focus on the news, but it's still apart of my process. Ideally what interests me are Partnerships, Earnings, Hype Plays, and Bio-Techs. Again I am not going to go over each of these, cause I can do a whole post later. Thirdly I since we trade the most volatile stocks, I check the FLOAT. The total number of shares that can be freely traded at the Market. Again the Float is never going to be exact, but you can get an idea. How do I find the Float? Look in the OTC Filings! Keep it simple guys and gals! I go back to the recent 10-Q / 10-K and use CTL+F and type the phrase "outstanding." You should be able to see it pretty quickly. On some occasions, I may use a 424B form since that is where the Offering Price and Diluted properties can be found. The FLOAT is a Major Factor for us Traders. Think in terms of supply and demand. When there is a low supply with an excess demand what do you think will happen! Look at $SES $BIMI $BNGO $OPTT $BPTH $DRY $SHIPS $IGC $NBEV $WWR $TOPS the list goes on and on. I categorize a low float stock that is under 10 Million, but again it's not an exact science. Next, I check out the Filings for any skeletons in the closet. Understand that we are trading the worst of the worst. What I am looking for? Ideally, I am looking for any potential Dilution. The same process as with the Float, I use the Command Key and search for key Phrases. For example, Offering, dilution, warrants, ATM ~ at-the-market, Unregistered Sales of Equity and Use of Proceeds. I typically go back for their recent 10-Q / 10-K. As well I am looking for any 424B Forms or an S-1. The S-1 is a shelf, if a prospectus, it's not live until the 424B if filled. Again this process may seem like it takes a while, but rinse and repeat and it becomes second nature. I don't spend too much digging since the more I investigate the more likely I will add to my confirmation basis. Ideally 10 min Max. A quick note, be very cautious is you attempt to Long a stock, that has a history of conducting Toxic financing in the past. Just like you, These "Companies" goal is to stay in the game, by any means necessary. So I do encourage you to just check you the flings if you do intend to Swing a Long overnight. Lastly, the most important indicator that I use is the PRICE ACTION! At the end of the day, the only thing that matters is the fucking Price Action! What does the daily trend look like? What day of the week is it? What's the volume? Price Action is KING!
4) Always Know the WHY: Again we all know what we do, but most do not know WHY. Trading Randomly will only lead to Random results. It all goes back to finding your niche as a Trader. If you ever feel uncomfortable in stock, I would encourage you to simply exit. It's much easier to get back in that it's it to get out. Fuck your EGO!
5) You don't have to Trade every day: This one is very underutilized. Look I don't look to Trade every day. I don't wake up expecting to Trade, I have a game plan yes. But again I will only act if those indicators are hit. As well depending on what the Big % reveals. If there is nothing that fits my personality, then I simply do NOT Act. I don't Trade to Stay Busy, trading to Stay busy will cost you money. Again is this a HOBBY or a BUSINESS to you. It sounds counter-intuitive, but trading less can help you in the long run. Trading is reality is Boring, I am like a Lion, I only come out when I see a baby gazelle. Or a Gimme Set-up.
6) Risk Management: This is a key component in my Trading Process. Understand that as a Trader your job should be to stay in the motherfucking game. Don’t worry about how much money you make in beginning. Filter out the noise, don't let other Traders' profits, make you feel bad about your trade. Again WE ALL ARE DIFFERENT! Understand that 90% of traders do not find a state of consistency within the markets. There is a reason for that. They have itchy fingers they have FOMO along with many other psychological hurdles. The goal is to outlast your competitors, be staying in the game.
7) Loosing is apart of the game: Understand that losing is in an essential part of Trading The key is to minimize your losses and to maximize your profits. Again the trades, in the beginning, in you’re trading career, does not matter in the long run. So I understand it’s hard seeing other Traders' profits on Twitter or any other social media platform, but it takes time to create a state of profitability within the markets. Each Trader has its own process, so don't try to copy their exact moves. Instead, learn from their mindset. That’s why risk management is very important in terms of your Trading process. If you don’t know what you’re doing if you’re just going to trade with any amount of size you are doing yourself a huge disservice. Again your job is to outlast your competitors your job is to stay in again and by doing so increases your odds of success in the long run. And I understand it just because you’re in a losing streak don’t get yourself down whenever you’re in a losing streak I highly encourage you to lower your position size. Avoid adding to a losing position. This is a game of losing because you have to lose well in this game and you have to accept a loss. A loss is never a bad sign, use that failure to learn from. That is what gives success its flavor in the end.
Once more you don't too over complicate your Trading process. Keep it Simple Stupid as the saying goes. K.I.S.S. Below will be the Video Recaps from this past week including the Weekly Recap. I will see you soon! Happy Presidents Day!
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