Judging by the posts, we’re all making money lately. Good, I don’t know of any other site with such high percentage of people profiting…especially when none of us are very smart or experienced. I think it’s cuz my impatience has taught you guys to take your profits or losses quickly cuz you’re trading the most volatile stocks around. Yes, you should let your winners run, but that’s not as important as knowing you should never ever let your losers run, no matter what your meaningless little mind thinks. (If I don’t cut your egos down to size, the market will, which do you prefer?)
First up, I shorted 500 NTI into the market close of its first truly down day on Monday. Volume had faded, Superman’s posts on TheLion.com stopped being responded to as often—basically the hype was dying down so my $13.70 entry point looked ideal. Pre-market Tuesday brought the usual 100 share painting-the-tape games, up $2, down $1, all meaningless. When the stock opened, it was down 20-50 cents, the range being the ridiculous price spread on such an illiquid stock. I wanted it to crack $13 or at least get close so I put in my order to buy at $13.01, which woulda been a $350 profit…never got there, not even close. A massive (sarcastic) buying wave of 3,000 shares took it up to the $14.50-$15 range and I thought about covering for a big loss…but I waited—it was just 1-2 orders! Volume faded and the stock gradually dropped, when a big sell order came in, I decided to get out and not risk another massive (sarcastic) buying wave to squeeze me for $1/share…no, I covered at $13.77, for a $50 loss. Good loss. No, it was a great loss. The rest of the day volume continued to be anemic, as it was today, very few orders executed below my price, now it’s just consolidating, could go either way…great, great loss cutting.
Download this cheat sheet to know how to short sell penny stocks safely.
Lesson: If a big gain does not seem likely, don’t worry about being up or down a few cents, just get out—you don’t want to risk a big loss when the reward ain’t there.
ROYL was the first to drop, but considering I knew all too well about morning spikes on oil plays, I was too hesitant. SPDE the same problem. No guts no glory. That left GRO, which was the only one to squeeze the shorts hard, up nearly $1 to $8.20…again, I wanted to short, but I didn’t want to risk a squeeze to $9…so I waited. After cursing my need to play it safe, I watched it break morning support at $7.40, on its way to $7.25. Patience, I told myself, if it’s gonna reverse big, it probly won’t go straight down…reason won and it hung around—just below—the former support, now resistance $7.40, which is ideal, so I tried shorting 800 shares at $7.37…only 500 executed, damn!
Stock dropped back to $7.25, tried to bottom there, bounced back up to entry price (I canceled my remaining shares to play it extra-safe) and then fell back to the $7.20 area. 20 minutes later, it got tired of being up only 10 cents on the day and then the tank was on…big sell orders pushed it negative to the $7.07 area, hung around there for a few minutes, then a massive 40,000 share market sell order came in and took out the buyers at $7…then stop loss orders did the rest, I covered into the panic at $6.91, even if I missed riding the full wave down to $6.80….profit of only $230, but it was a small trade—since it still wasn’t the afternoon, which woulda been ideal—and it was all inside of an hour.
More importantly, other site readers followed me in on that play, as they were plenty of shares available, Bob took an easy quarter/share, Moates made a cool $900 in an hour (those be Sptizer-type rates!) and $1500 today, LM showed us how it’s down by profiting $1.50/share!, Davey profited $300 by grabbing nearly 50 cents/share, while Cody and getshorty each made about 80 cents/share
I’m not making this stuff up, I’m not leaving any losers out (see for yourself), it really is that easy to short into big reversals and that’s why you guys neeeeeed my PennyStocking DVD to be better prepared for these patterns (and to stop asking e questions answered in this 6-hours-of-me-explaining-this-stuff thing. Hell, you don’t even have to short sell, one of the first people to buy the DVD, Tony Ellis, made a cool $3,860 (minus $50 in commissions LOL) going long these kinds of momo plays today alone and he’s up $50,000 since the beginning of the year!!!
You show me another financial product on the market that has such results without an leverage…if I was a fraud/snakeoil salesman, I would probly just make up these numbers, but each day brings new plays and gains so you just gotta stick around and see for yourself…in real-time.
Not content with just that little profit, I was also watching PTEK, which was up a ton on message board hype, World Series of Poker hype, whatever, the chart told me it was junk and you gimme a junkie that’s up 150% in a few days with fading volume and a wall of sellers and I get interested real fast. Oh yeah, I’d reserved shares earlier in the day, just in case—a good habit to get into. I patiently waited until the afternoon and when I saw a slight crack, I tried shorting 600 shares—not a full position cuz it was still up on the day aka if it didn’t tank, that’d leave the door open to late day spike or early morning squeeze tomorrow…got 500 shares at $5.15, immediately it went down to $5 x $5.13, I felt good. But $5 held, I got my other 100 shares and the thing spiked to $5.10 x $5.33 on something like 1,000 shares…total joke that didn’t last very long, $5 went and it dropped to $4.76 x $4.95…I put my limit at $4.61, but big buy blocks were everywhere in the $4.70s so I jut put a limit of $4.95—since there weren’t ANY stop losses at $5 (as there were on GRO at $7), there wasn’t a high probability that the few sellers could take out those big buy blocks in the $4.70s, no thanks, played it safe, got executed at $4.90, another $130 profit or so. Spike probable tomorrow.
Nearly $500 in profits for me today…that ladies and gentlemen is how you short sell penny stocks safely—no big positions, no big wins, no big losses, just bigger gains than losses. Good night and good luck