Millionaire Mentor Update: Low-Priced Stocks Are Hot Again
Low-priced stocks are hot right now. But with opportunity also comes risk — as you’ll see with COWPP later in this post. To take advantage of the opportunities, you need to work first on your knowledge account. How? Apply for the Trading Challenge today.
If the idea of trading low price stocks is brand new to you … go through my FREE penny stock guide today.
Table of Contents
- 1 Family First Visit to Israel
- 2 Fighting for Brazil’s Beaches and Marine Life
- 3 Trading Lesson: Low-Priced OTC Stocks in Play
- 4 Questions From Students
- 4.1 “You mentioned $COWPP in your October 28 watchlist as a potential dip buy. It had a huge bounce off the morning panic, but you didn’t trade it. Was there a specific reason?”
- 4.2 “You focus on big percent gainers, then look at volume and catalysts. Sometimes you mention the dollar volume traded. Will you please explain?”
- 5 Millionaire Mentor Market Wrap
Family First Visit to Israel
From Bali, I made my way to Israel. I’m here with the fam. It’s the first time to Israel for us, and it’s been a very emotional trip. It took us too long to get here. Israel is so incredibly beautiful — another reminder that the world is fascinating.
I’m grateful for the opportunity to trade stocks and teach from all over the world. And I hope it inspires you. Go out and explore. Experience the world because you only get one life. Make it count! I teach because I want you to achieve financial freedom. Then you can go out and see the beauty the world has to offer.
My Bucket List Visit to the Dead Sea
So far, one of the highlights of the trip was our visit to the Dead Sea. It’s a bucket list item for me. The water is so salty you can actually float on top, and if it gets in your eyes it stings like crazy.
As always, I’m trading. Even from this very special office…
As you can see I already have some really amazing photos. I’ll continue to share on social media in the coming days. The salt water is killer on electronics — those weren’t the easiest photos to get.
Before I get to low-priced stocks that are hot again, there’s one more important thing…
Fighting for Brazil’s Beaches and Marine Life
I don’t know if you’re aware of this, but there’s a catastrophic oil spill in Brazil. For the past two months, oil has been washing up on Brazilian beaches. And for two months, the source of the spill was unknown. On November 1, the Brazilian government finally pointed the finger. At a ship carrying Venezuelan crude oil back in July.
No matter who’s to blame, the impact on Brazil’s beaches and marine wildlife is devastating as you can see below…
⚠WARNING GRAPHIC IMAGES⚠
There’s been very little international aid. And the Brazilian government hasn’t done enough to get the cleanup done fast. So Karmagawa is stepping in to help. We’ve created a limited edition black Save the Reef charity t-shirt. 100% of the profits go to charities working on the Brazil crisis.
Local communities and wildlife need urgent help now. Please join me in using social media platforms for good right now. Show your support: share this and get your limited edition Save the Reef shirt here.
Again, I feel it’s my duty, and I’m honored to be able to help. For me, it all started with gaining freedom through trading. With that in mind — back to the hottest niche in the market right now … low-priced stocks.
Trading Lesson: Low-Priced OTC Stocks in Play
Last week, a Trading Challenge student asked me this question…
“When you traded $KBLB on October 28, your entry comment mentioned this being a hot niche. Were you talking about low-priced OTCs?”
Exactly. A lot of 20–50 cent a share OTCs have been hot so I gave it a chance. Let’s take a look at the trade because the next student question is related to this one.
Kraig Biocraft Laboratories (OTCQB: KBLB)
On October 28, KBLB spiked on a press release about record production at its Vietnamese facility. My goal on this former supernova was to make 10%–20%. I only made a penny and a half per share — it didn’t get the real big pop.
Here’s the KBLB chart on October 28:
I still made $483 on the trade on a 7.32% gain** — so not the end of the world. Just not as much as I thought.
Profit.ly users Tommy_D and redwagonrider were following KBLB that day, as well:
Tommy_D $KBLB trying to breakout over multi-month resistance at .24. C’mon little guy, you can do it!
Redwagonrider $KBLB will you break the channel at .24.
I think there are a few reasons KBLB didn’t get the big pop. First, it’s been a while for the stock. It was a supernova back in May.
Second, it’s a real company. They’re growing their breed stock of spider-silk silkworms in the new facility. They expect to produce more spidey-silk in November than in the last 10 years. And they expect to start producing fabric from the specialized silk in 2020.
So the fact that they’re manufacturing — versus all these other runners that are just hype — it’s actually a negative thing. Real company stocks can’t spike as much because the company can’t grow as fast.
Let’s get on with some related student questions…
Questions From Students
“You mentioned $COWPP in your October 28 watchlist as a potential dip buy. It had a huge bounce off the morning panic, but you didn’t trade it. Was there a specific reason?”
Yeah, I probably should have traded it. But it’s so weird how this stock moves. It didn’t bounce right away. Sometimes low-priced stocks are unpredictable.
Check out the Canal Capital Corp. (OTCPK: COWPP) chart:
Even if I’d bought that first dip and caught the bottom at around 36 or 37 cents, at best I would have been out at 42 cents. But it’s more likely I would have gotten out there in the 38 or 39 cent range around 10:45. (Click on the chart to open full-size in a new tab.)
The big spike really happened randomly at around 11:30. My guess is some promotional emails went out. I can’t predict when promotional emails are going out.
So KBLB — for me — was the better spiker. It had the morning spike. It was an even better dip buy. If you go back to the KBLB chart, look at the bounce off the 10ish panic. And then it held pretty well the rest of the day.
COWPP Gets Caveat Emptor Designation
A quick note on COWPP. Yesterday, November 4, COWPP got the dreaded skull and crossbones. That’s the ‘Caveat Emptor’ designation from OTC Markets. The stock was suspended from trading. And that influenced other stocks to crash, like recent spiker DCGD (now trading as GRNF) and SBGD.
This is yet another example of why you should never hold and hope with penny stocks. The companies behind these low-priced stocks can, and do, fail regularly. I’ve said over and over again that 99.999% of these companies won’t make it.
That’s why when I take an overnight trade I’m meticulous with my preparation and planning. Even after 20 years. The last thing you want is to get stuck in a position you can’t get out of. Which I discovered firsthand — very painfully — back when I was running a start-up hedge fund.
You can read all about that in my best selling book “An American Hedge Fund.”
Stayed up till 11 pm reading an American Hedge Fund. Halfway through the book. Very good read.
— Steven Taylor (@StevenT60511933) November 2, 2019
Last question…
“You focus on big percent gainers, then look at volume and catalysts. Sometimes you mention the dollar volume traded. Will you please explain?”
That has a lot to do with the time of day. Some people say to me, “Why are you buying a stock like KBLB?”
I think it had traded a few hundred thousand shares when I took the trade. But I bought it near the market open. KBLB went on to trade 3.49 million shares on October 28. So a few million shares traded on the day is pretty good. But you kinda have to extrapolate.
If you’re trading right near the open and it’s a few hundred thousand shares…
… even though it’s not a few million, by the end of the day it will be. Versus buying near the open when only 10K or 20K shares have traded. That stock might only get up to 100K or 200K shares traded on the day. That’s not enough.
Then, sometimes people get confused with the number of shares traded when it’s a two-, three-, or five-cent junker. At 10 cents a share … even if it trades one million shares, that’s still only $100K worth of stock traded.
So sometimes with low-priced stocks, I focus on dollar volume. That’s because it can get confusing if you say something like, “Oh, just buy anything that trades a million shares.”
Sometimes there’s a stock trading at a penny. Not even close to 10 cents a share. And if it’s trading at a penny and trades one million shares … you’re talking about so little money it’s not worth trading. You have to think about that.
I suggest reading “The Complete Penny Stock Course” to get the basics together. Too many people want to latch on to one indicator — price, news catalyst, volume, or whatever. But you have to think about more than one thing. So get the book and read it. Take notes. Then a lot of these things will make more sense.
Millionaire Mentor Market Wrap
That’s another update in the books. Low-priced stocks are back in play, but be careful. If you trade any of these stocks, remember to sell into strength and follow rule #1: cut losses quickly.
More importantly, remember you do NOT have to trade every day. Learn to prepare and wait for the best patterns to come to you.
How do you learn my strategies? Subscribe to PennyStocking Silver or apply for the Trading Challenge. It won’t be easy. But it’s not rocket science. Just be willing to study your butt off. And be prepared to get out of your own way.
Like Twitter user @TupuolaTeo:
Wooh! nice $419 on $CHFS, after a terrible October full of FOMO trading & terrible loss cutting. I was down $552, took a step back to revise my trades. Was pretty difficult to tell myself I was wrong, but I watched some @timothysykes and it got me right back to studying! pic.twitter.com/GpOBkaCMii
— Jonathan Tupuola-Teo (@TupuolaTeo) November 1, 2019
What Students Are Saying
There have been quite a few low price tickers on the move. Here are some recent low-priced stock comments and trades from the Trading Challenge and TIMalerts chat rooms. Oh, and Twitter:
Trading Challenge Chat
RD52 In $COWPP .4802 out .4487. 3k shares. Loss of $96. Two wins and one loss today. Up about $200 for the day.
Mt380 Made my first day trade today as a newbie. $COWPP. In at .365 and out at .46. I wanted 2500 but only 400 filled. I was very pleased with a 25% profit. Just with the $ amount would have been higher.
QuattroEd Sold my long $UNRG in @0.085 yesterday out at 0.14 a nice 65%.
Jspinoza3 bought 7517 ALPP @.088 sold at .1095, $162 profit.
Jackaroo sold ALPP from .07 haha locked in +$920.
Lorenzo14 Sold ALPP from 0.093, 70k shares just like Tim lol, got weirded out by the price action should have held longer probably. nice 700$ win.
TIMalerts Chat
Bmann ALPP In .205 out at .219 left a lot on table. Finished strong.
Arturoil710 After ALPP running 40%+ from the breakout ill definitely be on the lookout for more OTC breakouts.
lgz $ALPP still in @.093 small position. nailed the dip this morning. prob my best trade so far. Thanks Tim.
And some recent Tweets from students trading low-priced stocks…
@JennyPenny50
I dip bought $ALPP @ $0.29, a few mins later I added 1k shares to my original position. Amazing volatility! I stuck with it until the very end and tapped out @ 0.402, for $501 profit. Thank you @timothysykes
— Jeannette Feliciano (@JennyPenny50) November 4, 2019
@cris_9080
nice trade today on $ALPP for 20%. in at .31 out at .375. Crap company. The logic on the trade was onpoint tho.Alot of ppl hyping it up on twitter the whole morning, volume was strong w/good price action. Lol i just hopped on&offthe hype train before it crashes. @timothysykes
— Juan Ramirez (@cris_9080) November 4, 2019
And finally…
@AceBoogie2488 gets penny stocks…
This is why I love pennystocks. 22% in a few hours. $ALPP. @timothysykes pic.twitter.com/gDYNssPIZq
— Roland Brown (@AceBoogie2488) November 2, 2019
[Students’ results aren’t typical. These students put in the time and dedication and have exceptional skills and knowledge. Most traders lose money. Always remember trading is risky … never risk more than you can afford.]
What do you think about this post and all the low-priced stocks in play? Comment below — I love to hear from all my readers!
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Hey Everyone,
As many of you already know I grew up in a middle class family and didn't have many luxuries. But through trading I was able to change my circumstances --not just for me -- but for my parents as well. I now want to help you and thousands of other people from all around the world achieve similar results!
Which is why I've launched my Trading Challenge. I’m extremely determined to create a millionaire trader out of one my students and hopefully it will be you.
So when you get a chance make sure you check it out.
PS: Don't forget to check out my free Penny Stock Guide, it will teach you everything you need to know about trading. :)
Well Tim, what is learnt can not be expected, the markets are Living and breathing, set ups change and challenge the mind set and education.
One of the biggest lessons that I am learning is, You can not subject your will on the market, and if you do, it will Laugh in your face, you can’t just Trade a setup or a pattern and expect it to come through, you can Learn what you can learn, it may be a great Company with all the trimmings, does the market care… expect the unexpected, so cut your losses Early!! Don’t trade every setup that comes along. Trade those that matter, those that are the best setups with the highest probabilities, those that check all the box’s, will you be right, this does not matter, just learn to cut your losses early so you can TRADE another day!!!!
Another words, we do not know what will come though, what will work, what won’t, who cares take your profits when they are there to be taken, not when you are looking for them!! Cut your losers EARLY, who cares if you have won or lost, it should be all about, education and ability to act in the correct fashion!!!!!!
Thanks Tim!!