Why PennyStocking Is Not An Optional Course, It’s Required
You know why I’m always promoting my 6-hour PennyStocking instructional DVD package? (See the first independent thorough review HERE) It’s definitely not about the money—not yet anyway—it’s to help teach you guys the rules of trading penny stocks that I’ve learned the hard way over the past 9 years. I’m giving you my battle-tested rules of engagement that I wish someone had given me when I first started or even now cuz anyone with a decade of market dominating success is someone worth listening to and learning from.
Don’t say you’re gonna dip your toe in penny stocks and make some amateur error, writing it off as “why penny stocks are like gambling” or how it’s “part of your penny stock 
education”. My DVD is your tuition—I should probly get it accredited or something—not the more expensive stupid trading losses!
You want some examples? Fine, I’ve got plenty of them (people, I’m gonna use your comments not to be mean but to make examples out of you…it’s not like any of you use your full name anyway!)
First that comes to mind is Wes shorting SIX after a morning panic 10% drop. Stupid stupid stupid…even though I occasionally short in morning, I don’t recommend it—there’s too many spikes, the afternoon is usually much more gradual. And, even when I do short, I short looking for that morning panic, NEVER after it!
As for shorting IAR, NLS, VNDA or SIX—I’ve repeatedly said I don’t short earnings plays and there is a reason why I avoid them. Cuz earnings plays actually DO deserve to surge higher cuz the company is doing well—or at least that’s the perception. While they could very dip—as they sometimes do—the odds of a big drop are miniscule, so with my poor timing skills—which you probly have too—there’s no reason to even consider shorting them. I post them on my watchlist as potential buys only. Stick to shorting failing companies, frauds and pump and dumps, then you have the odds on your side!
Whoever just shorted VRML at 3.50—that was just a stupid entry…in the 3.70s or 3.80s, at least you still had a chance to get some nice space between you and the support at 3.45, but if you’re betting it goes negative on the day, there’s no point in shorting that close to support until that support cracks—ideally you short, making it crack…tough lesson for people to learn that sometimes its better to short at a lower price or not at all…sure, it still looks good, but now its just a waiting game.
With today’s VRML’s 10% drop off its morning highs, whether or not I’ve screwed up or there weren’t share available to short, I’m now 4 for 4 in my calls in the last 4 days:
LGDI 10% morning drop on Monday
VRML Tuesday morning squeeze from $4 to $5, big 30% drop off from $5
Shorting into VRML’s Wednesday strength for a solid 15% price drop, which I posted play-by-play HERE, HERE and HERE
Basically, there is a high degree of predictability down here with the gutter stocks, buuuuut only in certain cases so you must learn about the variables so you can adapt to profit from those worthy opportunities. That is what my DVD focuses on, the variables that align to create these patterns, then I detail dozens of charts, then I share trading lessons learned. It’s elementary, but simple works best in this niche.
I’ve worked my ass off creating these products to give you a foundation off which to build so no, I’m not your normal patient polite trading coach cuz I have something that is unique, something that really works. Ask any of those polite professional “experts” to blog every second, answer questions and face up to all criticisms. They won’t. They can’t. they are snake oil selling scum. Advantage Sykes.
Below is a small clip…PS to all of you guys emailing me, don’t add to the clutter that is my email box with some whiny emails asking why I haven’t gotten back to you, I’m friggin 2 weeks behind cuz only a few of you are using the FORUMS like I asked!
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May 15, 2008Yup, by next Monday, everything's gonna be real working-like!
May 15, 2008PDO, up $4+ today, will teach you not to randomly short strong penny stocks, get in, get out then run...cuz sometimes they squeeze stubborn shorts to death!
May 15, 2008No ideal short plays today, check out these 2 interviews while we wait for price action perfection
I wish I'd listened to my own rulebook, instead got squeezed for $400 shorting blatant-fraud KYUS too early...someone needs a refresher course this weekend!
I nailed NCOC's 20% rise today in my pre-market post, but I was too biased against buying little breakouts, learn from my mistakes!
May 15, 2008Lots and lots of new sketchy stocks to watch
Stock Watchlist
| XRM | $4.54 | |
| SSBX | $3.25 | |
| APWR | $22.15 | |
| VRML | $2.54 | |
| NTHH.OB | $0.21 | |
| DPDW.OB | $1.04 | |
| CROX | $10.97 | |
| SUNV.OB | $1.45 | |
| AYSI.OB | $2.10 | |
| FORC.OB | $2.29 | |
| CNEX.PK | $4.10 |
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1JensGould(TIMBUCKS: $37)
May 8th, 2008 at 12:43 pm
All good points Tim. Well done.
2YngvaiMalmsteve
May 8th, 2008 at 12:50 pm
Something I’ve found that helps me is to make a list of rules and WRITE THEM DOWN. Then whenever you’re about to enter a trade, make sure the trade fits within those rules. If it doesn’t, then it may be a trade that’s better avoided. This can help establish discipline.
3Christopher Cianci(TIMBUCKS: $16)
May 8th, 2008 at 12:56 pm
Waiting on taxes to come in - first purchase: DVD
4timothysykes
May 8th, 2008 at 12:59 pm
Yngvai, yeah I actually rewatch my DVd cuz it includes all my points!
VRML is showing nice nice action, wall of sellers now at $3.70, pushing down on the buyers in the $3.50s…$3.40 is still cracking point, dont know if it’ll happen today, tomorrow or next week, but I mean where’s it gonna go? Barring miraculous FDA news, volue’s fading, sellers gonna keep getting more confident, buyers–whoever’s crazy enough to buy a stock up 350%+ on no news–should weaken and eventually panic should set in
5Matt(TIMBUCKS: $5)
May 8th, 2008 at 1:00 pm
I’m going through the blog and copy/pasting the important stuff, in addition to my notes from the dvd. There are a lot of “gotchas” to look out for, and I’m using paper money on TOS until I understand what’s going on. The only problem is I can’t reserve shares :)
6Bob the VC
May 8th, 2008 at 1:23 pm
Good points all. My entry into VRML sucked (I didn’t realize just how close to support I was), but my exit was a total accident. I had a stop limit placed with an activation of 3.70. The order right before mine (according to my last sale indicator) was only 3.679.. How the hell it triggered my stop I have no idea.. It was still much lower then I should have set it, but I really expected to have time to adjust it..
7Dan-O
May 8th, 2008 at 1:45 pm
Here’s a useful quote:
“Anytime you find yourself hoping in this business, the odds are that you are on the wrong path — or that you did something stupid that needs to be corrected”
- Richard Russell
8Dan-O
May 8th, 2008 at 1:46 pm
Yngvai, do you keep a trading journal?
9YngvaiMalmsteve
May 8th, 2008 at 1:47 pm
No, I currently don’t keep a journal. I just modify and update my rules list as I make mistakes, perfecting my own rules.
10timothysykes
May 8th, 2008 at 1:56 pm
can u guys see this post okay, some people apparently had errors so we fixed it a bit
11Tony Ellis(TIMBUCKS: $24)
May 8th, 2008 at 1:57 pm
dsti…breakout inverse head and shoulders
12Dan-O
May 8th, 2008 at 1:58 pm
I was one of the people that reported the error, it looks fine now.
13Dan-O
May 8th, 2008 at 1:59 pm
Short Squeeeeze is on with CTDC
14Blithe(TIMBUCKS: $43)
May 8th, 2008 at 2:04 pm
Tim, at the end of your post you say “Below is a small clip…”, were you referring to something in “Related Reading”?
15timothysykes
May 8th, 2008 at 2:05 pm
nah took out the utube clip cuz it was havng problems
16Davey(TIMBUCKS: $132)
May 8th, 2008 at 2:07 pm
What a hideous spread on VRML, there is almost a .20 cent difference between the bid and ask.
17J-Mo
May 8th, 2008 at 2:08 pm
Tony, where do you see DSTI going from here?
18Dan-O
May 8th, 2008 at 2:09 pm
Anyone looking at CTDC?
19timothysykes
May 8th, 2008 at 2:12 pm
yah ctdc is a great pennystocking play, i have no trades today so its out of the question :(
20Bob the VC
May 8th, 2008 at 2:13 pm
I see ya Timmay..
Surprisingly my short at $3.7 was part-filled for 633 shares. That probably means this stock is about to go through the roof!
21timothysykes
May 8th, 2008 at 2:13 pm
tony, never trust a solar breakout, as csiq, solf, akns have taught us
22Goose(TIMBUCKS: $33)
May 8th, 2008 at 2:17 pm
ENT - breaking $3 pivotal point. Keep an eye out.
23J-Mo
May 8th, 2008 at 2:19 pm
Tim, on ctdc, when would you see the ‘whites of their eyes’ in that play?
24Dan-O
May 8th, 2008 at 2:20 pm
Tim, CTDC would make a great lesson on why you do not short after the move.
25AP
May 8th, 2008 at 2:20 pm
Page is working for me now.
26Dan-O
May 8th, 2008 at 2:22 pm
I wasn’t shorting it, I took a small long position when it dipped at 6.20
27Dan-O
May 8th, 2008 at 2:23 pm
Just to be clear, the company is a POS.
28monkiman(TIMBUCKS: $31)
May 8th, 2008 at 2:30 pm
GPCB…. make a few centz on that, wasn’t worth my time, as it was slow like a turtle. SWS was a nice uptrend stock, I got into very late, but still made $109…
29Dan-O
May 8th, 2008 at 2:36 pm
I’m out of CTDC, didn’t make much. TOS says it’s hard to borrow, oh well.
30nsaflyer(TIMBUCKS: $11)
May 8th, 2008 at 2:38 pm
SUNV, time to short again?
31Dan-O
May 8th, 2008 at 2:44 pm
I checked with TOS again (that chat feature is awesome), they have at least 1K available. I haven’t funded my TOS account yet so I can’t trade.
I wish you all the best of luck though.
32Mark
May 8th, 2008 at 2:48 pm
THINK OR SWIM doesn’t have any the stocks we want to borrow. What are we gonna do?
33RGIlles(TIMBUCKS: $16)
May 8th, 2008 at 2:50 pm
CTDC looks like it’s going to be a nice one
34mattiefattie
May 8th, 2008 at 2:51 pm
Advantage sykes haha. u having flashbacks to ur state championship high school tennis days???
35Dan-O
May 8th, 2008 at 2:53 pm
I wouldn’t short it here (only the second day up, another 500K shares still short), the squeeze will continue and there is not telling how high it will go.
The veteran traders know this but I worry about the rookies.
36codyhof(TIMBUCKS: $26)
May 8th, 2008 at 2:56 pm
Would like others opinion on SUNV… it feels like this pump hasnt slowed down.
37Goose(TIMBUCKS: $33)
May 8th, 2008 at 2:58 pm
ENT - going higher
38J-Mo
May 8th, 2008 at 2:59 pm
Is ASIA doin a cup and handle breakout like it did several days ago? around
39YngvaiMalmsteve
May 8th, 2008 at 3:00 pm
I reserved 50 shares of CTDC at $11 LIMIT so it won’t execute, then made it GTC so I’ll have it tomorrow. Can’t take a bigger position because of my limited buying power. Buying power should be better over the next few days so I’ll add to my position if things look promising.
40Mark
May 8th, 2008 at 3:01 pm
Think of Swim Suuuuuuuuuuuuuuuuucks!
41YngvaiMalmsteve
May 8th, 2008 at 3:01 pm
Yeah, Goose, I’m long ENT right now and making a nice gain on it
42Mark
May 8th, 2008 at 3:03 pm
Think OR Swim I mean. (Just wanna make it clear who I’m talking about)
43Davey(TIMBUCKS: $132)
May 8th, 2008 at 3:04 pm
50 shares…You should be paper trading for now…commissions are gonna kill you, and I’m pretty sure you can’t hold reserved shares overnight, even if you have a GTC order working at TOS. You have to use them in the day you reserved them or reserve them again the next morning.
44jesseb(TIMBUCKS: $34)
May 8th, 2008 at 3:05 pm
Hey Tim, a new version of Wordpress is available…your website wanted me to tell you :P
45RGIlles(TIMBUCKS: $16)
May 8th, 2008 at 3:05 pm
Why do they suck Mark? Be specific
46timothysykes
May 8th, 2008 at 3:06 pm
LOL classic pumper tricks on VRML, faking big buy order, trying to squeeze shorts, then in 1 big order take out all the buyers, just as we did at $3.60, then buy 100 shares back at $3.80…friggin amateurs!
CTDc, i wouldnt short anytime soon
47burky(TIMBUCKS: $16)
May 8th, 2008 at 3:07 pm
VSCI - does a flag pattern mean anything intra-day?
48YngvaiMalmsteve
May 8th, 2008 at 3:07 pm
Hey, Davey, thanks. I didn’t know you can’t hold shares overnight.
I only have a $2500 account right now, and was looking for a potential $1 drop. That would still be a $40 profit after commissions, a 2% return on my total account.
I’ll cancel the order and try in the morning. Buying power for me will much be better tomorrow anyway so I’ll be able to reserve a much bigger chunk of shares.
49novalis78(TIMBUCKS: $27)
May 8th, 2008 at 3:08 pm
yes, ENT and GTXO had a nice run up today…unfortunately, for me only on WSS.
50jesseb(TIMBUCKS: $34)
May 8th, 2008 at 3:08 pm
And why do I have 2 timbucks? I just registered ;)
51timothysykes
May 8th, 2008 at 3:09 pm
this is the new wordpress
52J-Mo
May 8th, 2008 at 3:09 pm
So Tim, I’m assuming by the lack of posts, you’re gonna hold onto your VRML short at least until tomorrow? Unless it drops below $3 in the next hour right?
53Davey(TIMBUCKS: $132)
May 8th, 2008 at 3:11 pm
YngvaiMalmsteve,
Just to be clear, it’s only reserved shares that aren’t filled that aren’t carried over. If you actually use your shares you can hold them as long as you want.
54will_the_thrill(TIMBUCKS: $36)
May 8th, 2008 at 3:15 pm
are we watchin bpsg?
55Dan_O(TIMBUCKS: $50)
May 8th, 2008 at 3:17 pm
Burky, I usually take it to mean a consolidation point.
Just my opinion of course, but regardless of the time frame the flag pattern doesn’t mean much to me until it resolves up or down.
I think it’s pretty cool that VSCI found support at the previous high. I like the illusion of an orderly world.
I’d watch this for a double top and maybe a possible retesting of those lows.
WTF do I know… I might just be a drunk, stumbing around in the dark. Don’t buy or sell anything based on what I write.
56YngvaiMalmsteve
May 8th, 2008 at 3:19 pm
Hey, Davey, thanks for the info. I knew about the day but didn’t know you couldn’t hold them overnight. That makes sense, otherwise people would be reserving shares days ahead of time.
57Mark
May 8th, 2008 at 3:20 pm
Think Or Swim sucks because I haven’t been able to borrow any of the shares I wanted the last two days, and apparently a lot of other people are having the same problem. If it would help to go to another OTC-friendly broker I will.
58Tony Ellis(TIMBUCKS: $24)
May 8th, 2008 at 3:20 pm
lol…i won’t be holding overnight.
59Goose(TIMBUCKS: $33)
May 8th, 2008 at 3:20 pm
IAR - can’t help but say this one just tanked crazy. Probably a lil too late to hop in for a quick gain.
60Adam(TIMBUCKS: $2)
May 8th, 2008 at 3:21 pm
Buy the DVD. Rewinding to better understand something is invaluable. Plus the binder with the entire DVD presentation and charts was an unexpected bonus that I thought was a huge help.
61Dan_O(TIMBUCKS: $50)
May 8th, 2008 at 3:24 pm
Homebuilders are getting f’n killed.
62Davey(TIMBUCKS: $132)
May 8th, 2008 at 3:27 pm
I use TOS, but I used Trade King before they have cheap commission and usually had all the stocks that we play here. Also I think Ameritrade allows shorting most stocks. I’m throwing them out there so we can all at least have a chance at getting these shares. There are only so many shares that each broker has of these hard to borrow stocks.
63TradeWizard
May 8th, 2008 at 3:30 pm
Whats up Tim? Just barely started looking at all your stuff and you are pretty amazing at what you do, I’m stoked that you put up for yourself and let everyone know there is a lot of BS out there on Wall St. Thanks for mentorship, I just started trading options late last year… Ever trade options Tim? Or are you a straight up penny stock shorter?
64nsaflyer(TIMBUCKS: $11)
May 8th, 2008 at 3:30 pm
Ameritrade doesnt have any CTDC but they do have IAR
65novalis78(TIMBUCKS: $27)
May 8th, 2008 at 3:32 pm
IAR - a fickle thing. Me in it goes out. Me out, it goes up. Me short, it goes up. Me cover, it goes down. Don’t you love this. Tim will dip my head under water :-)
66JensGould(TIMBUCKS: $37)
May 8th, 2008 at 3:32 pm
Here’s your hourly update on LGDI more big selling!! Every hour on the hour…
67Dan_O(TIMBUCKS: $50)
May 8th, 2008 at 3:34 pm
No offense, but I wouldn’t touch IAR. It’s at support and probably going to go sideways and chop.
68timothysykes
May 8th, 2008 at 3:34 pm
FYI guys that kind of breakdown after a slight breakout that ENT is is displaying is oh soooooooooooo common. there is a reason why i avoid certain patterns and this is one of them
69timothysykes
May 8th, 2008 at 3:37 pm
don’t draw any conclusions for the VSCI bounce, i’ve found time and again after those kinds of panic selloffs, the bounces dont matter, it takes all the wind out of the sails.
yes i’m holding VRML overnight,unless it tanks–really encouraging afternoon action here, just gotta take out $3.40 and i’ll be all set
70Webster(TIMBUCKS: $2)
May 8th, 2008 at 3:38 pm
Well I am in on my first short. VRML at 3.75 Ameritrade finally let me do one of these. Hoping to clear the 3.40 range and see it slide. Tim thanks for this site!
71Stoquer1(TIMBUCKS: $11)
May 8th, 2008 at 3:38 pm
I here ya Novalis
72timothysykes
May 8th, 2008 at 3:39 pm
if u think you’re gonna get borrows every time, you’re sadly mistaken. thinkorswim does a great job, but u gotta get up early and or have a specialty broker (who requires $250k) to get the best borrows. dont cry, many times where u cant find any shares, its good cuz the shorts get squeezed. vrml was scary there for a while…as to what other stocks u’re trying to borrow, i have no idea, no other supernovas on my watchlist
73JensGould(TIMBUCKS: $37)
May 8th, 2008 at 3:41 pm
Tim what pattern on ENT do you mean? The breakout after the downturn its had?
74timothysykes
May 8th, 2008 at 3:41 pm
thanks TW, just a penny stock shorter, read my book and u’ll see why–its where all my experience is
75TradeWizard
May 8th, 2008 at 3:42 pm
How is your day going today Tim?
76TradeWizard
May 8th, 2008 at 3:44 pm
Read your book American Fund manager? is that the one you are talking about? I would love to, where’s the best place to purchase?
77timothysykes
May 8th, 2008 at 3:46 pm
lgdi and vrml have the same kind of sideways price action, difference is VRML is up on hype, LGDI is up on contracts and manipulation…i choose hype
78TradeWizard
May 8th, 2008 at 3:46 pm
Oh yeah, Tim what trading platform do you use? Or what do you recommend?
79novalis78(TIMBUCKS: $27)
May 8th, 2008 at 3:47 pm
Stoquer1, hi there. My timing is even worse than Tim’s ;-). I hope you got out of IAR safely.
80Joseph
May 8th, 2008 at 3:51 pm
Trading Platform: ThinkOrSwim
BOOK : An American Hedge Fund (it’s on your right)
81Dan_O(TIMBUCKS: $50)
May 8th, 2008 at 3:54 pm
FYI, J. Lebed’s contract with PSTI is over tomorrow.
82timothysykes
May 8th, 2008 at 3:55 pm
day’s going well, thanks VRML’s fluffy PR delayed the inevitable, but i have some crazy stuff going in the background, wish i could tell u guys about it, but not yet…
yes, my book An American Hedge Fund shows u why i’ve come to short these penny stocks and only that:
http://www.amazon.com/exec/obi.....hysykes-20
83Goose(TIMBUCKS: $33)
May 8th, 2008 at 3:57 pm
VRML has a stinky spread.. Still a good play?
84timothysykes
May 8th, 2008 at 3:58 pm
thanks dano–good info about PSTI!
85J-Mo
May 8th, 2008 at 3:58 pm
VRML dropping…dropping…
86Dan_O(TIMBUCKS: $50)
May 8th, 2008 at 4:03 pm
Hey man, that’s what were here to do!
By the way it was you who told me about J. Lebed’s Ultra-Annoying newsletter.
FYI he stipulates the contract date in the closing part of the e-mail, so I just put it into my outlook reminders.
I’m looking to short PSTI if it can resolve past the 50DMA, there are (what I believe) phantom buy orders @ 2.98 and 3.00 which should scare some people off. I’m looking for .50 to a 1.00 move on that bad boy.
87TradeWizard
May 8th, 2008 at 4:03 pm
You dont just use think or swim do you Tim? Is that direct access or what?
88timothysykes
May 8th, 2008 at 4:08 pm
right now i’m only using thinkorswim, will also soon account at speedtrader
89TradeWizard
May 8th, 2008 at 4:11 pm
Awesome thanks for the info Tim.. It would be really cool to sit down and meet with you sometime and go out to lunch or something to get some of your ideas on the market! Maybe a possibility in the future?! I’m new to the whole trading scene but so far I am loving it and I would love to learn from one of the best as yourself! Let me know man! Your a badass Tim, totally got me inspired to be successful at this business!
90Goose(TIMBUCKS: $33)
May 8th, 2008 at 4:15 pm
MESA touched .84 whoever mentioned it about shorting when it falls below that..I want to know what ur action is tmr altho AH is up a bit.
91Jeff C(TIMBUCKS: $30)
May 8th, 2008 at 4:20 pm
Tim, what common pattern are you speaking of with ENT…thanks. Also, Only your latest radio interview is available to play, it automatically plays without the choice of selecting the other interview (Fous is the one I’m trying to hear)
92timothysykes
May 8th, 2008 at 4:25 pm
new post:
http://timothysykes.com/2008/0.....nce-books/
93Fantom
May 8th, 2008 at 4:28 pm
Besides Tim, anyone here hit a 100k yet?
94folding(TIMBUCKS: $2)
May 8th, 2008 at 6:25 pm
Already ordered the DVD. Just waiting for it now.
How long does it usually take to arrive?