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The Perfect First Green Day Setup

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Written by Timothy Sykes
Updated 4/18/2023 11 min read

Perfect First Green Day Setup: Key Takeaways

  • OTC first green day plays are most consistent when three specific indicators line up.
  • Two ‘PLUS’ indicators can make the play even better. (Even if one of the big three indicators isn’t ideal.)
  • First green day overnight gap-ups happen when informational inefficiency meets FOMO.
  • Keep reading to see how I traded the BILZF, VNTH, and CYBL first green day setups.

 Trying To Grow A Small Account? Discover the Power of “FGD Fridays”

What Is the OTC First Green Day Setup

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In this post, I’ll review three first green day trades. First, it’s important to understand how to identify a first green day. (The VNTH trade below goes deep into the difference between a first green day and a meaningful first green day.)

This is what I look for in an OTC first green day…

  • Big percent gainer with volume. It should be up enough that scans pick it up.
  • Holding gains. Going into the close it should be at, or near, the high of day (HOD).
  • News catalyst. Some OTC first green days don’t have an obvious news catalyst. Keep reading to see how I treat them a little differently.

Using the above criteria, let’s review three trade examples. The first is a reminder that a great trade can come up at any time… 

3 Examples of a First Green Day Setup

The first example goes back to September 2019. It was the last hour of trading at the 2019 T&I Summit when the perfect first green day setup forced my hand. At the time, it was one of my best trades in years.

Ignite International Brands Ltd (OTCQX: BILZF)

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I was willing to not trade during the conference. Attendees seemed a little disappointed. But if there’s no perfect trade … there’s no perfect trade.

Then, in the last hour of the trading day, Dan Bilzerian posted on his Instagram story. The post said that his company’s stock was available on the U.S. market. And that created an informational inefficiency. Many people who wanted to invest were waiting. Until that day they didn’t know it was possible.

A Perfect First Green Day Setup

Take a look at the BILZF chart below. It shows a perfect OTC first green day setup for the overnight hold. Notice the huge morning spike, too. I underestimated how high it could go.

BILZF chart: Sept. 23–24, 2019, OTC first green day, gap up to supernova — courtesy of StocksToTrade.com

I made $3,921 on this OTC first green day play. (Starting stake: $9,240.) And I also made $1,042 on the dip buy. (Starting stake: $11,950.) The first trade turned out to be one of my best trades in years. It fit my indicators perfectly and went up another $2 per share after I sold.

A few things about this particular first green day trade…

Moving Pieces: Understand the Nuances of Individual Trades

Given the situation, the setup, and the price action, it was a good buying opportunity in the $1.20s or $1.30s. But there were a lot of moving pieces…

Fills were tough. I tried to buy in the $1.20s and managed to get filled at a $1.32 average. Then I ended up with a bigger position than I wanted. I’m pretty sure my order got executed right away but with delayed reporting.

Not knowing whether you’re in a trade can cause problems.

It was an afternoon dip buy of a strong first green day. That provided some protection in case I was wrong. There was support and a clear risk level in the range where I bought it.

As usual, I sold too soon but was happy with a 43% overnight win. Recognizing that it was a good opportunity was the best thing about the trade. And it was cool that everyone at the conference got to see it in real time.

Why I Love Penny Stocks

BILZF was a nice refresher about the potential for penny stocks. It’s also a reminder that focusing on ideal setups can help reduce frustration. Most traders face losing odds every day.

So focus on your perfect trading setups. Then rinse and repeat.

Here’s a more recent example of a first green day…

NanoMobile Healthcare Inc (OTCPK: VNTH)

VNTH had a perfect multiday breakout on October 13, 2021. It was a solid first green day OTC play so I bought a dip off the highs. Here’s the chart with my trade…

VNTH chart
VNTH chart: 10/13-14/2021, OTC first green day — courtesy of StocksToTrade.com

VNTH gapped up the next day and I sold for a solid $497 win on a very small position. (Starting stake: $6,680.)

A Trading Challenge student asked how VNTH was a first green day when it was the second green daily candle. Check it out…

VNTH chart: 3-month to October 14, 2021, OTC first green day with pluses — courtesy of StocksToTrade.com

Was the circled day a first green day? It’s open for interpretation. Yes, the color of the candle is green. So, technically, the next day was a second green day.

But look at the volume. The questionable first green day had low volume. And it only finished up roughly 7% on the day.

On the meaningful first green day, VNTH had…

  • A big percent gain — finishing up 23% on the day
  • A big volume spike — more than double the previous day
  • It closed near the HOD
  • PLUS: a beautiful chart with a multiday breakout
  • PLUS: heavy promoter activity (it was a big Twitter pump)

The only thing missing to make this a perfect first green day setup was a news catalyst. But promoters, press release rumors, and a multiday breakout outweighed the missing news.

Here’s another example of an almost perfect first green day setup…

Cyberlux Corp. (OTCPK: CYBL)

An October 6 company tweet started with “Quick update: The dots do connect.” That led to a strong first green day on October 7 for this former runner. Then, at 3:42 p.m. Eastern, Cyberlux teased acquisition news. As always, thanks to StocksToTrade Breaking News for alerting this tweet.

The stock started running and broke out over the earlier HOD. It was a little risky, but I took a position. My plan was to hold it overnight, but CYBL had a massive runup into the close. So I reduced my position size. Later that night, the company confirmed the acquisition.

Here’s my trade…

CYBL chart: October 7–8, 2021, perfect OTC first green day setup — courtesy of StocksToTrade.com

It was a beautiful gap-up for a $1,541 win. (Starting stake: $11,046.) To recap — CYBL’s first green day had…

  • A big percent gain — it was up 25% when I bought and closed up 36%
  • Upcoming news in the form of a self-promoting tweet
  • It closed near the HOD
  • After-hours confirmation of the news — again, that creates an informational inefficiency, and less meticulous traders place buy orders overnight
  • PLUS: it had a clean intraday breakout
  • PLUS: heavy promoter activity

It didn’t have a big volume spike. But it still traded 239 million shares on the day. And it was a perfect #5 from my 7-step pennystocking framework.

What Defines An OTC First Green Day

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Again, I like to see a big percent gain and big volume. Ideally, there’s a news catalyst. And I like to see the stock holding at, or near, its highs into the close. A multiday or multi-week breakout is a plus. Heavy promoter activity is also a plus in the current market.

Why OTC First Green Days Work

They don’t always work. But when they do, it’s because most people aren’t meticulous. They see the spike and news overnight and get encouraged to place buy orders at the open. The OTC first green day setup is about being early and recognizing that.

Final thoughts on this setup…

Learn the OTC First Green Day Setup

Trading random patterns leads to frustration. Inevitably people say, “Hey, I don’t wanna trade as much. I don’t wanna feel frustrated all the time.”

Focus on patterns that make sense. It’s not an exact science, but the OTC first green day setup happens based on specific indicators. Once you learn to recognize them, you put yourself in a position to trade them.

If you’re still under the PDT, the first green day pattern is one way to grow a small account. Holding overnight doesn’t use a day trade.

Want to learn how to recognize solid setups like an OTC first green day? 

Apply For the Trading Challenge Today 

The question is, will you learn from someone with experience and a track record, or learn the hard way? It’s your choice.

What do you think of the OTC FGD setup? Comment below, I love to hear from all my readers!

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Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”