With only 20 working days left to go at my day job, time is flying by fast and trading will commence on the 16th November 2015.
While I’m still at my day job it’s funny the reactions I get from different people when I tell them what I’m going to be doing instead. Some are genuinely excited for me and think it’s incredible what I’m about to embark on and wish me the very best, while others look down at me, laugh and think it’s all a joke!
One of the most important things in life that I’ve learnt is that no matter what anyone thinks or says about you, you MUST do what YOU are passionate about and believe in, and GO DO IT no matter what anyone else thinks!
I CHOOSE TO BE ME AND NOT THEM!
Those that knock me down in life do it because they’re jealous, scared, don’t understand, haven’t done it themselves or simply who knows why they do it and why should I care what they say or think?!….. Simply put; I don’t!
I don’t care what anyone thinks of my plan, because I will succeed or die trying is how hard I am willing to work and succeed at trading penny stocks as my source of income!
So as well as doing my homework and studying hard, I also like to keep myself in a positive frame of mind and block out all the negative effects in the world by watching videos of positive rewarding intent.
You look at Will Smith for example. He started with next to nothing and built his dream up by NOT quitting or stopping at any hurdles that tried to stop him from becoming the success he is today.
Another incredible story is that of the richest man in China who founded Alibaba Group.
My point is this; It does NOT matter how little money you have got, how much you lack in certain skills or even what you look like or where you are in the world.
All that matters is your desire, your willingness and hard work to make your ambitions come true. To make things happen you have GOT to educate and train yourself repeatedly and repeatedly and keep on trying until you succeed!
Watch this 7 minute video for a bit of inspiration and you need to understand and realise that your life is NOT to be dictated by anyone else’s beliefs.
My First Penny Stock Analysis will be one of my chosen strategies
If you go to my profitly profile page here, you can see that I’ve posted a couple ideas and what I’ve been looking at as I study and understand what to trade and more importantly how to trade it. Yes I am still learning and intend to learn something new every day I get up in the morning and so should you if you want to continually grow.
So this is one of my favourite trading tools that I use for screening stocks to show me which ones fit my searching criteria in order to implement the strategies I have learnt from Timothy Sykes. By selecting certain options, Finviz filters out certain criteria that I am looking for so that I can choose more selectively which stocks to trade.
It was by using this tool that I came across $OREX as it fitted the type of strategy that I am going to be using, once I start trading on the 16th November 2015.
Through studying and learning from Timothy Sykes “The Short Squeeze” is one of the main strategies that I am going to look for when I start.
It was actually a bit of a coincidence that I came across $OREX as when I was looking at all the data in front of me I took a peek at level 2 as well, and noticed right away that there was quite a bit of price action going on(lots of buyers and sellers trading). This was on October the 8th near closing market hours by the way, so this looked like the short sellers were possibly beginning to cover their trades or buyers were in the room.
The only thing that I couldn’t conclude to was to why the short sellers were possibly covering or buyers were buying, as there was no recent news or information to make this happen as such. I liked the chart pattern on this stock and the volume and price is very good as well.
The only thing that doesn’t fit my selective criteria on this stock is the size of the public float and the market capital.
Moving onto Friday the 9th October, just after the market close it is announced that Seth Klarman has bought 17% of the company and the stock spiked up to around $2.80 ish which then rolled back down the two following next trading days, but then found buying support around $2.45 ish which is a good sign and opportunity to dip buy the next day.
If you look at the simple chart below you can see “The Cup And Handle” pattern, which was an ideal time to Dip Buy around the $2.45 area or even the $2.80 area around market close the next day, in the anticipation of short sellers getting scared and covering their positions as it was starting to breakout. With the recent Seth Klarman Billionaire play news as well, which was the main catalyst that started this move, the potential of High reward and low risk are in your favour.
If you want to see the more important details on the Cup and Handle pattern, with what to look for and how to trade it then go over to this post HERE.
How far this stock goes is a guessing game now and I will not trade guessing games. Having said that there is resistance close to the $3.50 area, but it looks like the majority of short sellers have covered their positions so whether there are more spikes coming soon is hard to tell at this stage and I would only trade this if it dips and shows strong support at a lower price.
I’m not trading at the moment of course until the 16th November, but find it very educational to not only study charts, but write about them as well so that I train myself in the process and hopefully you can learn too.
Another possible trade that I spotted
Another small cap stock I came across, well it’s actually a nano cap, but that’s irrelevant anyway. The stock ticker symbol which is $PRSN I came across for a different reason.
$PRSN had it’s earnings release just about to be released which made me look at this stock that fits most of my selective criteria. Apart from the volume and lack of past activity of buyers, which is very low overall, I felt it’s quite relative for the size of the public float, but have actually learnt that it is a bad idea to base volume amounts on the relative size of the public float. The stock is either in demand or it is not, and this stock is NOT in demand overall.
How ever, looking at the data in front of me and the chart as well made me believe that there was potential for a small spike after their earnings release which was due out before market open on October 15th.
I noticed a rise in volume towards this date and figured it was worth watching, but for what ever reason there was and still is no news on their earnings report so there is no potential reaction to this stock yet.
What I don’t like about this stock though is that it’s in trouble financially and could be de-listed from the NASDAQ due to not meeting certain criteria like being under a dollar for a period of time. This makes me wonder if anything will happen to make them get out of trouble by somehow increasing the stock price with a good earnings report or any other good news. Looking at the past history of volume (buyers and sellers), there really isn’t that much going on overall other than sellers dominating this stock.
There was actually another Cup And Handle pattern on this stock starting around the 21st August and forming on the 15th September, with the opportunity of a dip buy on the 21st September. However, with the small amounts of volume going on which moved the price about 12 cents on the 21st it would have been quite a risky move on this stock, and worst of all there wasn’t really any juicy news or catalyst to think about this move so it would have been a risky trade with a stock like this, which is what I don’t want.
Keeping risk low and High reward consistent is the name of the game. The Risk/Reward ratio to this one is too uncertain, which makes a stock pick like this non-tradable unless some really decent news comes out.
So all in all I was pleased with my thesis on $PRSN that it could spike a little with earnings news, but after going over this pick in more detail I’m glad that I’ve learnt what NOT to pick with the de-listing possibility on this stock and lack of interest with buyers overall.
To top things off with this post I am very pleased about learning the Cup And Handle pattern which will be one of my main chosen trading strategies now, and I will explain in better detail about this strategy in another post.
For $OREX, with positive news and short sellers in play the Risk/Reward ratio is in your favour to profit from set ups like this. Just remember to be patient and Dip Buy.
~You Must Have Patience And Engage In Consistent Action~
On one final note here, no matter what anyone says or thinks about you, you are the ONLY one in control of your very own future.
Until next time, stay positive, believe in yourself and above ALL else take ACTION towards your future today.