Frustrations Of A Short Seller
Awoke to discover no shares available to short of my top 2 potential plays—FEED and PSTI. PSTI was no biggie, it wasn’t a multi-day runner, but missing FEED pissed me off cuz it was a nice morning setup for a solid PREDICTABLE fall.
Yesterday it looked like it was getting tired, but it still wouldn’t crack. Today, near the market open, there was a 14,000 share buy order at $15.40 and as that got taken out rather quickly, it was clear sign to short as longs who were up big over the past few days surely were afraid of a reversal. Sure enough, the morning tank was on as it quickly took out stop losses at $15 on its way to $14.70-ish, a nice 70 cent/share drop from an easy entry. Sure, it rebounded over the rest of the day—impressive really, but then again it’s a true breakout so I expect the stock to be stronger than a pump and dump—but the play here was to cover into the stop loss panic. Next!
As I mentioned HERE, CNOA tanked big—24%–and I didn’t profit one cent. Hope you guys did!
Looked like it was gonna be a non-trading day, but then in the last hour oil and gas multi-day runner, KOG, after a big morning spike and drop—a classic sign of the beginning of a reversal—broke perfect sideways price action at $2.80, so I shorted 2,000 shares at $2.75, just as it was going negative on the day (as I preach in my instructional DVD PennyStocking, short sell big-time multi-day runners that are in strong long-term downtrends near the market close on their first negative day…usually you get either a small morning drop followed by a big afternoon drop—as the realization by the longs that it’s heading lower takes hold—or a big morning panic)
Unfortunately, this is a commodity play traded on the AMEX—two of my most hated variables—so after cracking PERFECTLY to $2.65, some shorts were squeezed into the market close, as it closed at $2.75 (I don’t count the 200 share painting the tape by some desperate long to make it appear green on the day). I’m not that worried, maybe it’ll take an extra day of holding, but the problem is I’m flying to Buffalo tomorrow and don’t get in until noon—so I’m flying blind on this trade, which I absolutely hate! Obviously it makes a new higher high above $3, I’m screwed—although not definitely cuz it could be a fakeout breakout—but if it stays a little negative on the day, I think the odds are good for a 10-20 cent/share drop, and then we gotta see how far down it can go. Not an ideal trade by any means and yet I’m short overnight…
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| Date | Stock | Buy | Sell | Net |
|---|---|---|---|---|
| Sept 4 | COIN | $5.70 | $6.21 | $745 |
| Sept 3 | COIN | $6.49 | $6.30 | $305 |
| Sept 3 | COINW | $2.75 | $2.85 | $180 |
| Sept 2 | TAYD | $7.51 | $8.13 | $545 |
| Aug 18 | FOUR | $2.80 | $2.66 | $342 |
| Aug 14 | APII | $2.66 | $3.30 | $1261 |
| Aug 12 | APII | $3.25 | $3.40 | $285 |
| Aug 7 | NOBL | $5.02 | $5.49 | $680 |
Total: $26,508 (
114%)
1InvestorsLive.com
April 15th, 2008 at 9:30 pm
That’s when your supposed to have your friend watch your account with specific instructions “If it dips to 2.65 go ahead and cover” but never allow them to trade as they feel, they’ll end up covered at $4. I would hate to see it dip out of open a few pennies and rip back up, but this thing is getting toppy and at some point it has to take a dump down
2InvestorsLive.com
April 15th, 2008 at 9:36 pm
BTW whats the reasoning for speaking tomorrow, similar to your interviews… or is it about something particular? or just a general Q and A
3GabeC
April 15th, 2008 at 9:52 pm
Its up 3.94% after hours. Uh oh big morning spike, possibly, before tanking?
4GabeC
April 15th, 2008 at 9:56 pm
Kog I mean. scared?
5timsykes
April 15th, 2008 at 10:00 pm
speaking at university of buffalo tomorrow night.
AH action is a few hundred shares…not very scared, i can even add to my position
6bee
April 15th, 2008 at 10:41 pm
i shorted FEED at 15.4… and SOL at 12.7… man. i dont know what to do now ..
7InvestorsLive.com
April 15th, 2008 at 10:47 pm
I knew it was at the U of Buffalo, just wondering what the topic is, are you speaking about what you do, finance in general, entrepreneurial ventures or a specific topic geared towards the university?
8timsykes
April 15th, 2008 at 10:50 pm
i got a whole university speech to get students interested in finance/stock trading
9pete
April 15th, 2008 at 10:59 pm
ordered your book, im gonna figure out this crazy penny stock short slope trading yet!
BOOOO yA
10InvestorsLive.com
April 15th, 2008 at 11:07 pm
Ah - http://ubstockclub.com/?q=node/98
11Oliver
April 16th, 2008 at 12:18 am
bee, why would you hold SOL for so long. haha. you do realize that this thing is $15+ now.
hopefully you have learnt a lesson that tim has been preaching since he started this. CUT YOUR LOSSES FAST.
12Vaibhav
April 16th, 2008 at 12:36 am
Tim,
FEEd went up to 16.00 in after-hour trading session.
What do you say- should I short sell it early in the morning?
13timsykes
April 16th, 2008 at 12:43 am
no u dont short strong stocks randomly, now its already consolidated and shaken out the weak hands.
also u guys gotta stop caring about petty afterhours action, it’s like 500 shares, unless there’s big volume/news, its meaningless
14bee
April 16th, 2008 at 1:35 am
do you guys think that SOL will pull back a bit and i can cover ?
15Oliver
April 16th, 2008 at 4:23 am
bee- i dont even think i would wait for the pull back. its not such a microcrap company with market cap of 1.5B. i would just get out of there, get over the loss.
i cant really find ANY reason for being short in there in first place. nothing of what tim has been preaching was in that stock.
16monkiman
April 16th, 2008 at 5:02 am
Hey bee, welcome to my world, hehe. If SOL keeps goin up today, might else well listen to everyone here and cut your losses quick. But I recently shorted 1,000 shares of TITN @ 21.75, and it went up near 23, so I had a huge loss, but luckily it came around, and I covered @ 21.38 yesterday.
17Dinosaur Trader
April 16th, 2008 at 6:56 am
Tim,
Don’t forget, when you’re giving your speech, to mention the VO.
Also, don’t get in any trouble with the college chicks.
-DT
18Dinosaur Trader
April 16th, 2008 at 6:59 am
Note: This is an experiment…
I’m sorry… I meant to say, hot, eager, naked college chicks
-DT
19lmsmith
April 16th, 2008 at 9:06 am
Who ever held on to their FEED SHort- Is Getting SQueezed real bad- It’s up 8.3% in pre-market
20Vaibhav
April 16th, 2008 at 9:49 am
Tim,
Feed had already crossed 17 this morning. Do you think it is the right time to short sell it? It has gained more than 40% in last 5 days, a phenomenal jump.
21timsykes
April 16th, 2008 at 10:05 am
40% is nothing, i don’t short randomly into strong stocks, thats how u get squeezed. wait for the setups i outline in pennystocking
22Keith E
April 16th, 2008 at 10:34 am
How come all the short opportunities i find that look great on the charts dont have any volume on average?
23Keith E
April 16th, 2008 at 10:51 am
A few examples are GENC,BSM, both have had good runups inside of a month but low daily volume.
24Keith E
April 16th, 2008 at 12:04 pm
KOG looks like something to watch
25chad
April 17th, 2008 at 12:07 am
Why try to short a stock that’s in one of the strongest sectors? Sectors strength will move garbage stocks up…why not stick to week sectors, then find the stocks within that sector that have the weakest relative strength when compared to its peers…anyhow….like your site a lot and generally like your trading style!