The Art Of Short Selling When The Hype Wears Off
Posted by Timothy Sykes on Mon 7th of Jan, 2008 02:23:00 PM
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TIM $14,552, Up $477 on the Day
No Positions, Not By Choice!
Saturday marked my 2nd month on Covestor, a cool stock social networking site, so now I’m in their rankings and guess what I’m #1 with an annualized return of 800% compared to the next closest guy at 225%! (Although the system is a little flawed because I only take 1-2 positions at a time and they count that as 50-100% of assets even though it’s really only 20-50%. LOL Is my strategy really that unorthodox?) You can track my trades here (although not real-time…yet)
As you saw in my last post, I had a great morning, but in the afternoon, I couldn’t day trade, so I wanted to short something into the close. Even though the market was down big on Friday, today is the first big down days for most solars (what’s always worked for me and as preached in my dvd, short into the close on the first down day – very simple, very effective).
The problem being that I like to short stocks that haven’t tanked hard – I like gradual droppers because panic hasn’t taken out the stop losses yet (I wanna be short when that happens). In the morning SOLF dropped $9, CSIQ dropped $4, CSUN $3, ASTI $3, HOKU $2, ESLR $1 and DSTI 75 cents—the resulting price action all VERY typical. The ones that didn’t drop much – SEED and AKNS – those would be my afternoon shorts.
The morning low for SEED was $9.23 and AKNS was $14.01, so when those prices cracked, or if the stocks were close to those levels, I’d short. These were perfectly downtrending stocks, their afternoon fades were niiiiice. With 30 min. to go before the close, both lows cracked and I placed 2 short sell orders.
Both were REJECTED?!?!?!?
Unfortunately, my freewheeling day trading caught up to me and sapped all my available day trading buying power. Idiot. Even though these would be overnight holds, I was done for the day.
There’s nothing worse than a missed trade. Look at the intraday charts below (Note how SOLF bounced when it couldn’t take out the morning low, none of you random market BullShippers can tell me these charts are random!), SEED continued to fall perfectly, basing lower for the rest of the day, closing down at $8.42 (an easy 60 cents plus the probable gap down tomorrow!?!?!?!) while AKNS was a little different, crashing quickly to $13.38 before rebounding $1 (entire market spiked) then dropping yet again to close at $14. SEED, I’ll never be able to get back, but I’ll probly have another shot at AKNS tomorrow. C’mon morning spiker!
(Nasdaq: ITMN) – big up day into an ugly, ugly chart. Good drug news, wanted to buy into the close, probable multi-day runner (damn my lack of buying power!?!?!) hopefully it can continue squeezing the 8 million shorts, then it’ll be a good short, ideally in the mid $20s.
Makemadmoneywork.com thinks my book is “…a great depiction of a real trader.” I’ll take it!
(NYSE: CC) – I like the strength, but up 20 cents is too little for me and it still might roll over, aka not worth buying or shorting.
Speaking of social networks, this study shows how they are the future – another cool one is MyWallSt.net. It’s crazy that 1/3 of my website’s traffic comes from my MySpace profile, even though I put little to no effort there (I prefer Facebook). Head’s up on (Other OTC: SMXT.PK) soon to be renamed College Tonight, a wannabe Facebook for college students. Sounds very pumpable, right? Hopefully it can get on the OTCBBs though.
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Related Reading
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TIM Trades
View All| Date | Stock | Buy | Sell | Net |
|---|---|---|---|---|
| Nov 19 | AENY | $2.80 | $3.02 | $1148 |
| Nov 18 | NLST | $4.16 | $4.40 | $947 |
| Nov 18 | IMGG | $1.42 | $1.64 | $2094 |
| Nov 17 | NLST | $5.04 | $5.59 | $2195 |
| Nov 13 | VRMLQ | $21.50 | $22.97 | $2901 |
| Nov 11 | EONC | $2.61 | $2.80 | $687 |
| Nov 10 | EONC | $2.74 | $3.36 | $9784 |
| Nov 6 | QXM | $4.31 | $4.80 | $1936 |
| Nov 4 | COT | $8.66 | $8.88 | $642 |
| Nov 4 | QXM | $4.61 | $4.89 | $822 |
| Oct 30 | DDRX | $25.70 | $26.53 | $812 |
| Oct 29 | CTDC | $4.00 | $4.42 | $781 |
| Oct 26 | AWSL | $3.24 | $4.10 | $2516 |
| Oct 23 | RODM | $5.27 | $5.23 | $301 |
| Oct 22 | AMLM | $2.69 | $2.97 | $820 |
| Oct 22 | USEG | $6.12 | $6.09 | $85 |
| Oct 20 | CBOU | $8.93 | $9.06 | $243 |
| Oct 16 | VRMLQ | $16.79 | $18.65 | $2773 |
| Oct 13 | YONG | $11.05 | $11.66 | $1202 |
| Oct 13 | NPHC | $0.59 | $0.71 | $583 |
| Oct 12 | IMGG | $0.60 | $0.70 | $682 |
| Oct 9 | ZAGG | $5.50 | $6.10 | $2380 |
| Oct 7 | GVBP | $0.03 | $0.27 | $702 |
| Oct 1 | NPHC | $0.70 | $0.85 | $1482 |
Total: $98,094 (681%)
