The Daily PennyStocking Roundups Begin Now!
Posted by timothysykes on Mon 19th of May, 2008 06:21:24 PM
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Based on my book/DVD sales, email list and website subscribers, there’s now a few thousand of you out there who are playing these trashy low priced stocks based on my PennyStocking strategies, which obviously makes me Naismith-like proud. Don’t get me wrong, I didn’t invent making $ from buying and shorting these corrupt companies, I’m just gonna be the one to popularize it! Especially Short Selling these suckers!
Since there’s sooo many different players trading sooo many hot stocks now, I thought we’d have a daily roundup post like this that will benefit us all. Forget about just my trades/lessons and gains/losses, I want you guys to share your daily moves too! If we all share our thoughts/trades openly, everyone benefits and can better be able to adapt to the current environment/evolving patterns. 90% of traders lose $, so if we can reduce that number here to say 20-30%, we’re not only profiting, we’re doing something helpful/meaningful. (These kinds of posts are just the beginning)
So, this morning–no matter that I’ve repeatedly stated it’s wrong to short into a morning spike cuz they always go further than anyone expects–I broke my own rules and shorted, current Supernova-forming FPP. Even though it was a commodity play–which I hate–and an earnings play–which I also hate, emotion got the best of me as I shorted 1,500 shares at $3.92, expecting the wall of sellers at $4 to hold and for me to scalp my way to $300-ish profits rather quickly.
From the get go, FPP didn’t cooperate, holding steady near its highs, within 5 minutes taking out the 15k sellers at $4 and surging straight to $4.25….as this was happening, all its fellow oil and gas plays like PDO and MXC were making ridiculous runs, so FPP seemed the cheap way to get in on that momentum–aka the upside appeared bright.
I immediately covered half my position at $4.25, waiting to see if I could get a better exit on the remaining 700 shares, since despite the breakout and its momentum, there were sellers as this is a stock that had already squeezed shorts on Friday and normally never moves more than 25 cents/day…I was right yo hold and within minutes I covered my remaining short at $4.01, total loss of $350ish, but saving an unnecessary additional $175 loss.
I was right to suspect a morning pullback, but it went further than I expected and a 25 cent pullback on an AMEX stock is not enough to EVER warrant a short, risk-reward-wise…later in the day it pulled back 50 cents off its $4.50 high…$4 acting as support yet again…just the latest lesson how it’s easier to short in the afternoon, even if you’re wrong–as the stock bounced off support and finished at $4.28…even more important a lesson, just go long the momentum, short only when it goes red on the day, preferably in the afternoon, which could happen tomorrow or Wednesday or Thursday…who knows.
Next, I looked to short directly into every short seller’s nightmare, MXC. I wanted to wait til the afternoon–honestly I did–but with its illiquidity and blatantly obvious Supernova chart, I knew from experience it’s best to short right into that kind of absurd move and just hold on for your life. So, I shorted 200 shares at $27.08…nice seemingly solid wall of sellers at $27.50…within minutes it was at $26ish…thought about covering, but the price spread made it tough, a quick ask in at $25.50 coulda woulda shoulda been $1.50/share gain, but I wanted more, like $3-$5/share…so I held.
But the weakness was brief and although the sllers look determined, the bids keept increasing and I knew with my recent losses I had to protec tmy tiny account from getting tinier…after all, once the wall at $27.50 and $28 fell there could be a monster short squeeze to $30+…I’ve seen it happen before…no thanks…covered at $27.50, just before that wall came tumbling down…stoc continued getting stronger…surprisingly…then it got halted just under $28!
At first I thought it was the standard SEC questioning the company for more info, company would deny any new news, stock would tank, but lo and behold MXC came out with drilling news…it’s debatable whether or not the stock will spike or tank, but it is actual news for this still only $50 mill company, albeit, slightly fluffy, ‘m glad I’m not in it…ideally there’ll be more opportunities to short this sucker, we’ll see.
Total loss on the day, $58, including commissions…for all my hard work, a loss of $205 on the month. Buuuuuuut the good news is I’ve learned to cut my losses hardcore and protect my account. When I do my monthly review, you’ll see I’ve made just about every mistake in the book and yet I’m down like 1%??!?!? Yup, it’s good to cut your losses, you do that well, it’s extremelyyyyy tough to be one of those 90% of traders losing $.
Let’s hear how you guys did, trades, lessons, gains/losses…let’s round ‘em up…and please for learning sake, be honest! (don’t be afraid to post stocks you’re watching too, crap like CWSI are great finds!)
Now you can Twitter any questions/comments to TIMhelp and obviously you can follow TIM on twitter too!
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TIM Alerts
View All| Date | Stock | Position | Ideal Exit | % Gain |
|---|---|---|---|---|
| Nov 24 | KVHI | Short | $3.70 | 18% |
| Nov 20 | STSX | Short | $3.10 | 11% |
| Nov 18 | PERY | Short | $3.75 | 25% |
| Nov 11 | IIJI | Short | $2.80 | 5% |
| Nov 6 | CVI | Short | $4 | 15% |
| Nov 5 | MECA | Short | $1.95 | 51% |
| Nov 4 | CVI | Short | $4.81 | 4% |
| Nov 3 | NAK | Short | $3.20 | 5% |
| Oct 29 | EVC | Short | $2 | 26% |
| Oct 28 | HSNI | Short | $6.80 | 7% |
| Oct 28 | HSNI | Short | $5.75 | 4% |
November: 9 alerts, 15% avg gain
October: 11 alerts, 14% avg gain
Short shot, what is your basis on shorting RAME??
WES?! Wow, you’re brave. I would never buy that high.
target aquired…will BIOF be the next PEIX goin’ uuupppp!!!!! need a dip to buy into
MXC and PDO are on crack!!!
nononono me fuck up. XNL is the play I want
holy crap Wes! Get out now with a nice 30%!!!
new post is up:
http://www.timothysykes.com/20.....g-returns/
keith, horrible trade, this blog exists to prevent trades like that
wes, u got balls of steel, great entry on MXC
Quick note to all if you don’t happen across Stocks in Play for all the traders out there why not stay a personal log on that forum and keep it updated as you make your trades.
Quoting you as saying So, “I shorted 200 shares at $27.08
level 2 quotes, i’ll do a post about it soon