CHATROOM

7 Stocks You Shouldn’t Trade, Long Or Short

February 28, 2008 at 7:54 pm
by timothysykes

Watch these 7 free video lessons on how I became a millionaire

Nothing particularly special, but that’s no reason not to get to know some messy chart patterns…aka learn what kind of chart patterns NOT TO PLAY!

A few weeks ago, AsiaInfo Holdings Inc. (ASIA) reported great earnings, now it’s consolidating…blehhhhhh…this stocks loves to breakdown after spiking, but now has positive news for a change. 50/50 up or down, leave this one alone.

asia

Converted Organics (COIN) is full of pumpers and recently executed a perfect double top at $14, but it still broke out of a multi-week base in the $9-$11 range. Wait for it to prove itself above $14 or for the bottom to fall out…until then leave this to the pumpers and suckers.

coin0228

I’ve gotten dozens of emails (please stop emailing me questions, use the FORUMS instead!) about this Image Entertainment Inc. (DISK). Its fallen, its risen, blehhhhhh, so many rumors, no absurd move…yet. FYI A $1.25 rise in price isn’t sooooooo amazing!

disk

Everyone’s gettin’ all excited about Gencor Industries Inc. (GENC) being added to the IBD list next week. Big whoop, who cares, good for a little pop, but then, you have games where people expected it, they wanted a bigger pop, some in at lower prices, etc. and the volume is soooo low, it’s just not worth it. Let’s see how far this thing can go…

genc

Ahhhhh the Latin American Ebay, Mercadolibre, Inc. (MELI), what a difference a few months makes. No more pumping from TheStreet.com or IBD, now it’s got a nasty solar-type chart, welcome to third world startup investing! Earnings soon, just wait on the sidelines until then.

meli

Omega Protein Corporation (OME) has a price surge I’d typically short into, but it’s a breakout and it’s proven on past spikes it likes to move horizontally for a few wees after any spike. No, thank you.

 

ome

Chinese advertising guru VisionChina Media Inc. (VISN) just reported some nice earnings andanaged to break out, too. But an ugly afternoon drop casts doubt on its ability to lure buyers, let it play out for a few days, let’s see if it’s got more juice left.

visn

No positions, no reason to be positive or negative on any of these, say it with me now, it’s all in the charts!

Posted in Patterns To Avoid, Potential Plays, Uncategorized

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Related posts:

  1. 7 Stocks You Shouldn't Trade, Long Or Short
  • Brian D

    I went long (rare) on VISN today and grabbed a nice $.45 a share on it. VISN looks like it could go either way if it cracks $8.50 I might have to get in but I haven’t had the chance to check the intraday charts from about 2 weeks ago.

  • Jack

    Tim,
    Thanks for bringing this piece of infomation to educate others. On GENC chart above, you mentioned “….volume is soooooo low.” Looking at the chart alone, GENC seems like it was hibernating, the average daily volume according to Yahoo was about ~4000 but beginning of February, the volume picked up more than 10 times of average daily volume as the price has doubled in this month. Yes, it is not 200 or 300% within a week like IDMI, but GENC probably will be ripen enough to short once it will be added on IBD. Just a thought!

  • timsykes

    GENC i meant volume is so low for me to take any position, even a few hundred shares impacts price. i prefer liquid names

  • http://jcutz5000@aol.com The Barber

    I have to disagree with the coin opinion. Its clearly down trending and showing text book weekness after the perfect double top. Ive been holding my short since it could hold its breakout. I cant belive u been watching this thing for two months and your not short now.. This is the best time to be short coin. This is when all the money is made. Oh I forgot u dont hold things for more than two days. hmmm… I feel thats were the real money is made. sometimes u have to hold..

  • http://jcutz5000@aol.com The Barber

    Ill check back and see how this plays out and who is right. I feel I always throw great trades on this site. I wonder if anyone is listning..

  • timsykes

    I agree that COIN looks good for a longer term short, but you forget how few options I have with TIM this small. I must stay nimble and the $2-ish downside potential for COIN over the next few days isn’t worth my time as I’d only have 200-300 shares and there’s still a huge risk of spiking. There’s plenty of decent trades like this out there, but until I have enough assets, I’ll ignore them all and people with similar sized accounts should too. This is why I stress focusing on only the most ideal trades–COIN is not ideal

    PS No telling how COIN woulda performed today if SEED hadn’t bombed so badly. News interferes with reading chart patterns, understand that

  • Oliver

    Great post. I was already thinking about asking this question a few days ago: What is the reason why you dont short earning reports of crappy companies?
    I know youve mentioned it a lot (pretty much everyday) that you dont play earning reports but I could never find a real answer for the reason behind it.
    Isnt a crappy company still doing bad eventhough theres some kind of earnings? Or is it because usually a stock stays up when the earnings are good because people gain confidence and you just wait until there is bullshit pushing the stock up rather than facts of earnings?

    By the way, I like how TIM has been developing throughout February!

  • Aegir

    How about talking stocks that might do some breakout!!

  • burky

    Hey Tim, really enjoying your blog the last several days with so much focus on specific stocks, charts, and how to play ‘em … and which ones to ignore. No morning spike on DARA this morning … so far looks like it could be a boring day all round.

  • puma

    COIN up almost 0.25, if it hits 13 will it show resistance again? good time to short if it keeps climbing or no?

  • timsykes

    Anybody body still holding DARA short? Now, $1 lower, u see how truly pathetic my exit was!

  • Tony Ellis

    I’m still holding! 314 shares….wish it was 5k! lol

  • ETQT

    I wish…too scared to hold overnight

  • Davey

    I got shaken out, made afew hundred, but you’ve shown that these patterns don’t lie. CEGE, IDMI, DARA, SHZ, these stocks have made you the most since starting TIM, these need to be held longer like you said, the patterns just don’t lie, these things give up almost half or more of their gains.

  • timsykes

    Tony, 314 shares is better than nothing!

    As for not playing earnings plays–simply too many different expectations. I would buy a strong breakout as those have a tendency to really run but every other pattern is just too damn unpredictable. Kinda liek FDA approval

  • Tony Ellis

    What about JRJC if it can break $20? I know it’s an earnings play but also one hell of a spiker.

  • Chemajh

    Since you’ve mentioned it, I read about Livermore. Playing the market’s like shooting pool: you’ve got to have a feel for the game, cueball position, how the table runs, etc. You seem to have a feel for the penny market. You’ve opened my eyes to it. Thanx!

    I am wondering, though, do you ever lend credence to the indicators like MACD or Williams % or any of the others? Since I’ve discovered your site, I can’t recall any mention of such. Enlighten me to the extent these indicators might be worthwhile or not. I see you like Stockcharts.com and Murphy touts the indicators. How do you use them, if at all?

    One more thing: you’ve defended your name quite well, working with such little stake and making it grow. Nice work. Nice guidance, too.

  • Brian D

    I’m still holding DARA on both sides this thing has now given me 15% on the month and IDMI gave me 10% this has been my best month. Made some other Okay trades but nothing near as good as what IDMI and DARA have given me. Fuck the pump!

  • be-the-ball

    brian d

    your mother must be so proud

  • timsykes

    JRJC, who knows, i don’t l ike earnings plays unless they’re new breakouts

    COIN–sorry shorts, thats what u get for ignoring the multi-week breakout

    MACD, RSI, nah I just keep it simple, price and volume. it’s all one big self fulfilling prophecy so the more people that use an indicator, the more likely its reliability. not enough MACD, RSI, fibonacci freaks in this sector to be very useful

  • lmsmith

    COIN- I went long on it this morning- It Performed the same exact way as it did yesterday-and every other morning in the past…. I surprise it hasn’t downtrend yet since it’s the afternoon- well I sold- a quick $425 profit… and yesterdays $323- I can eat off coin- just play that pattern..I guess until it breaks..

  • Tony

    I know you don’t like earning play. But what do you think of something like DBRN to short after earnings? Or how about MENT?

  • timsykes

    DBRN and MENT look to just be following the overall market. and i don’t try to guess the market

  • be the ball

    i see your reasons, but gotta say I am surprised you covered. woulda thought you’d wait for the potential afternoon fade

  • http://www.test.timothysykes.com timothysykes

    i’d love to wait but i’m friggin exhausted, 3 hours of sleep due to chart.ly testing all last night, just not a big enough position for me to risk some kind of quick news-related spike either, nap time

  • be the ball

    fair enough, have a nice nap

  • amzzz

    im hanging in there….wish i could nap.

  • Getshorty

    Is it me or DDRX is about to drop??

  • Getshorty

    It wasn’t me, that coffee Buzz is over.

  • be the ball

    gotta work on that big buyer at 3.9

  • amzzz

    I’m our bcrx. meeting. nice quick fade. goodluck

  • http://www.test.timothysykes.com timothysykes

    whoops, 10 minutes too soon, lets hear how much u guys made off this!

  • be the ball

    ok, took a little off at 3.72

  • be the ball

    BCRX out for a $250 gain, patience paid off there.

  • adamandco

    gotta love these mobile apps for iPhone!!! covered BCRX @ 3.75 in the men’s room! –> became an annual subscriber last week and I just paid for it this morning

  • be the ball

    On a more depressing note, family and I have a vacation to mexico booked for next week.

  • echo1025

    My first trade since joining last wk. Covered at $4.01. Made $556. Thanks tIm!!!!

  • tmcnally

    Nice short Tim…and the rest of you as well. Had to dismantle my laptop to repair a jammed left mouse clicker…was glad when I logged back in to see the drop in BCRX.

  • swierzycki

    Shorted 700 BCRX @ 4.15. Covered @ 3.69 & 3.99 for a quick $142 profit. Thanks Tim.

  • avoigt_2000

    i am short KIRK tim !!!

  • Getshorty

    DDRX baby, staying under 7.50

  • one_guey

    Btb, sorry all of us stupid fucking Mexicans had to ruin your vacation by dying at nearly 100 people. How dare we allow a virus to mutate on it’s own.

    My prayers go to out to the victims as well as those who are now fighting for their lives in Mexico and here in the USA.

  • Getshorty

    RT red for the day

  • be the ball

    dude, i am 1/2 mexican…

    30,000 people die in the usa from the flu every year. are you praying for them every night too?

    douchebag, take a joke

  • be the ball

    sorry if I offended anyone except the schmuck above.

    as a mexican I can call my people stupid all I want, much like Tim cracks Jewish jokes all the time.

    what I forgot is that you can’t see what color I am on the internet…lol…next time I will clarify.

  • http://www.kabam.com tbohen

    Wait WTF!?!? Your not Ty Webb?!?! Bastard imposter!!!!

  • be the ball

    LMAO…

    Remember Danny – Two wrongs don’t make a right but three rights make a left.

  • be the ball

    jeez, now there was an earthquake in Mexico..wtf…

    http://www.cnn.com/2009/WORLD/americas/04/27/mexico.quake/index.html

  • Reaper

    +$249 on BCRX

  • SRT8U

    I always loved the Bible thumpers saying “Im praying for you” or whatever. What a nice guy God is, slapped some Swine flu on the Mexican population and now delivered an Earthquake. Keep up those prayers. Lets all pray for a 3rd world country so they get hit by SARS and Tornados. Whatever makes you sleep at night I guess.

  • amzzz

    anyone still watching ddrx? curious…

  • HopeSolo

    Here’s an idea for everyone: Let’s keep politics and religion out of the alerts page unless initiated by Tim, since he can do whatever he wants on his site.

  • Reaper

    agreed HopSolo. But sex is definitely allowed. Big balls!

  • amzzz

    ummm. I haven’t seen a women post on here in a long time…no sex either Reaper.

  • vicdim

    ok i dont get it… with all the news on the flu, nothing is moving!!
    does anyone know why???

  • kakifiru

    4/27/2009
    10:47 AM MARKET – SHORT TRADE NVAX -740 $3.00
    covering now

  • http://www.test.timothysykes.com timothysykes

    glad to see bcrx and nvax holding up, i might’ve timed it wrong, but i knew there was too much strength for a bigtime fade..c’mon squeeze into tomorrow!

  • SRT8U

    DTG broke HOD… bought at $2.45.. could be a 2 bagger soon.

  • StrCrusade

    I agree with you Vicdim, I was plannin on some easy money today…But on the bright side, as long as prices stay where they are, I can increase my position on the cheap. I’m long 1.5k shares of NNVC

  • bill

    tim will beat me I think. I bought BCRX at 4.73 this morning (well, got to make some big mistakes like that). and deeply frustrated for the whole day. should have take a stop loss.

  • bill

    of course I bought it before I saw the alert for shortselling it.

  • http://www.test.timothysykes.com timothysykes

    i won beat u, i’ll just encourage u check out my instructional DVDs so u can familiarize yourself with these patterns and not get wrecked next time:

    http://www.test.timothysykes.com/store

    their cost will be paid for in 1-2 good trades and/or saving u from 1-2 dumb trades

  • dave197984

    With all the health care industries going up do u see a nice reversal once they relize its not that serious?