Why PennyStocking Is Comparable To Heroes The TV Show

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An incredible post on Muddy’s Blog written by Mikity Mike must be read everywhere cuz it’s got trading wisdom in it. Soooo many great and successful people practicing and writing about PennyStocking out there, it’s beginning to feel like Heroes the TV show…The series tells the stories of ordinary individuals who discover that there are incredible trading opportunities in low priced stocks, and also explores how these people adapt to the changes the market brings, and their roles in preventing losses and saving the 90% of traders who lose money.

Think I should pitch NBC?

All I know is that I’m beginning to feel like Mohinder Surhesh…my job is just to study and categorize this phenomenon in order to publish the profit serum that’s gonna save everyone…save the trader, save the industry kind of thing…enough from me, here’s Mike’s excellent post, maybe you should just refer to him as Hiro Nakamura:

I’m gonna try to put everything that I do to prepare for the next trading day, the scans I run and the different styles I use to chose stocks to trade both long and short. No doubt I will forget a few things and will update this post as I remember different things. I’m gonna try to get it all in this 1 post because the last month I’ve been asked by quite a few a bunch of questions regarding my trading style. Please note that very few of these ideas are mine. Most have come from Muddy and his blog. It took me many months but I think I’m on the track for a very bright trading future, thanks to him.

First, every weekend I run the top 40 dayrangers from last week:

“show stocks where the average day range(10) is above 8 percent and close price is between 1 and 10 and volume is above 300000.”

With this scan I have a column added ADR(30) and I rank the top 40 in order top to bottom highest ADR(30). For next week the list is:

DCR HYHY FPP LNG SSBX PFB WCI XRIT YTBLA TPLM SYNM KIRK SPF UNCL RTK ROIAK ICOG MMPI LCC TGC PEIX DCGN EEE UAUA XJT ENT QTWW KYUS NWA BSHF DSUP GFG CPSL BCON RCH EGR EBHI AKNS ATSG LGND

Next I scan for stocks over 8% gain from yesterday,this I run every night as opposed to once every week 40 dayrangers. These also ranked top to bottom ADR(30). The scan:

“show stocks where close gained more than 8 percent over the last one day and price is between 1 and 20…average day range is above 3″

Mondays list:

HYHY WCI KIRK UNCL ROYL EGR SWTX LGND PTEK CALC NCOC GLOB DGLY LLNW DPDW MERX MAG FRPT ALLI VITA NSU TRR JUPM ITI OZN QBIK COOL VVTV QUIK IDIX NENG EXAS HGRD TGX PLX SLTN FIRE VG SHFL MRVL

Next I scan for over 15% gainers over the last 2 days ranked top to bottom ADR(30):

“show stocks where close gained more than 15 percent over the last 2 days and price is between 1 and 20…average day range is above 3″

Mondays list:

HYHY SSBX UNCL MMPI DSUP PCSV EGR SWTX KOSN LGND TRX PTEK TRMP MAG FRPT ALLI TRR ITI QUIK ULBI HGRD TGX PLX FIRE SHFL MRVL TRIB WIND MESA GNTA NEXC HSOA GNLK SNUS CHTR SPSN SLTN QBIK COOL NENG

Next I run the The Combo scan which is stocks that have run the highest amount of times 10 to 19% in the last 100 days ranked in order of highest times to lowest times run.
On Stockfetcher.com it’s known as the RunForestRun scan.
I then cherrypick the ones over 9% in the ADR(30) column.
Thus the name Combo, combo of the RunForestRun scan ( found on Stockfetcher) and Muddys high ADR(30)

Here’s the SF code for the scan:
close is between 1 and 15
average volume(90) above 50000
average volume(10) above 250000
offset is 0

set{volcnt, count(volume above 50000, 100) }
set{volzero, count(volume equal 0, 100) }

set{x1, high - open}
set{Long_Profit, x1/open }

set{C1A, count(Long_Profit > .04 , 100)}
set{C2A, count(Long_Profit > .09, 100)}
set{C0010, C1A - C2A}

set{D1A, count(Long_Profit > .09 , 100)}
set{D2A, count(Long_Profit > .19, 100)}
set{D1020, D1A - D2A}

set{E1A, count(Long_Profit > .19 , 100)}
set{E2A, count(Long_Profit > .29, 100)}
set{E2030, E1A - E2A}

set{F1A, count(Long_Profit > .29 , 100)}
set{F2A, count(Long_Profit > .39, 100)}
set{F3040, F1A - F2A}

set{G1A, count(Long_Profit > .39 , 100)}

and add column daychg2
and add column C0010 {4_9}
and add column D1020 {10_19}
and add column E2030 {20_29}
and add column F3040 {30_39}
and add column G1A {40+}
and add column C1A {ttl}

sort column 6 descending]

I run this only once a week for it changes very little day to day.

Here’s this weeks watches:

SPF SYNM QTWW ABK DCR GETG ICOG UNCL RTK MBI XJT FBR NYNY FBTX EEE MMPI BDCO PKT FTWR KUN FPP ENT PFB KOG HDSN TNRO IMB WCI SSN ROIAK LGDI GFG ROYL HDY JAZ HEV GRZ NBF YTBLA LCC

Next I scan for red candles at, or even better, out of the UBB (called floaters). I use this for watches to short in addition to watching those to short from the 15%+ gains in 2 day scan mentioned above. I always watch the ones with a date offset of 1 also cause these tend to go down pretty nice over a few days period.

Here’s the scan:

stocks where close is above upper bollinger band(20) and close is below open and price is between .5 and 20 and volume is greater than 200000
offset is 0

Mondays watches:

WTSLA UFS CWTR COCO CKR CMGI SINO SCS NSIT STSI HRZ RDEN ITI TRMP PCSV SMRT MMSI CYBX TMM

Then I scan for the top 120 RunForestRun stocks for next week.You really need not do this but since I use 3 monitors, ONE IS ALWAYS RUNNING THE SCOTT SCROLLING HOD LIST, I can watch a bunch of stocks in seconds by flipping fast from watchlist to watchlist.

And then the morning an hour before open I begin loading the Premarket leaders from Interactive Brokers onto a watchlist as possible long/short opportunities.

It’s not as many watches as you might think because many of the stocks are on multiple lists.

Ok, now some of my thoughts on what is important to me for successful trading.

1. I can not live without the scrolling Scott hod lists.
Muddy showed me how it was possible to get 20,30,40,even over 50% profits in minutes to a few hours using this. Last week I caught MESA and LGND almost at the start of their runs.
Never had them on any lists,only saw them on the hod list,which brings me to this…….

17. As mentioned in the scans I run, I love to find red candles at the UBB and especially red “floaters” above the UBB. Then I wait for red the next day to go short. As Muddy used to tell me, “Red floaters kill!”

If I think of other tips that might be useful I will update on this post. I hope this will help clarify what I’ve been taught and how I try to put it into play for the average person just like me.
I feel I have a tremendous edge with this stuff, hope some of you find this helpful.

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