How I Screwed Up Shorting Cannon Exploration Inc (CNEX), Down 40% Today, While My Readers Are Making Tens Of Thousands

Where do I even begin on this one. Like my previous near-perfect call on fellow joke of a company pump and dump VRML, my readers made much more $ than I did. In fact, I lost a bundle shorting CNEX the other day at $6, admittedly too early/forced to due to the circumstances, covering at $7.20 yesterday, not wanting to risk a big-time gap higher/possible short squeeze today. Fortunately for me, there were shares available to short this morning so I reserved 500 and as I posted HERE, I planned on watching this one all day, shorting only when the pattern was to my liking.

After a slight gap higher, the buyers were drowned by sellers—we’re talking 10k volume here folks, nothing major—so I quickly placed an order to short sell with a limit of $7 when the price was $7.25 x $7.30…3 minutes later the priced had cracked big-time below my limit and it appeared I hadn’t gotten my execution. Damnit! Having been in this spot many times before, I knew it’s tough shorting into probable morning dumps so I lowered my limit to $6.50…nope, still no execution…20 seconds later and the stock was testing $6.  

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How I Broke My Rules And Lost Short Selling A Fraud, Cannon Exploration Inc (CNEX)

Just about everyone and their mother understands Cannon Exploration Inc (CNEX) is a an outright fraud. Whether you look at PinkSheets.com displaying a skull and cross bones with the tagline “Caveat Emptor” next to its stock quote, its now $470 million marketcap (at $7.25 stock price), the blatant pumping by all the usual suspects and the fact that this company has no business of any kind and has now septupled (7x) in price in 5 days all due to a fluffy PR announcing a new website and a sketchy letter of intent to acquire a seemingly real business, no doubt in exchange for pumped up shares.

Knowing all that, you might understand why I shorted 600 shares yesterday at $6/share half expecting it to go higher—with the goal of averaging my cost basis up too—but never excluding the possibility of a quick $1-2 drop in price.

That’s all well and good, but as a PennyStocker, I have no excuse and my $760 loss (I just covered at $7.20), including commissions, is well deserved. Because while this company is scummier than most, it’s just the latest pump and dump that can—and often do—run further than anyone thinks possible so I still should’ve played by the rules I myself created! Rule #1, don’t short randomly strong penny stocks, you gotta wait for the price action to concur with your thesis. Usually it’s best to short into the market close of the first down day of a big runup, but sometimes that’s too late, so shorting in the afternoon when this kind of a stock goes from positive to negative often opens the door to a big afternoon dump.  

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Lessons Of A Publisher/Video Blogger/Trader (In That Order)

Looks like I should’ve scheduled my video interview for after hours because I got back after the market close to find myself down 40 cents/share on CNEX—which practically guarantees a higher opening tomorrow (even if the bid is pretty much where I shorted), I missed on NNVC’s perfect afternoon 25 cent/share fade (any of you guys get in on that?), which shoulda woulda coulda been a solid profit on my 2,000 shares (reserved earlier).

And just to rub it in, I missed out on PDO squeezing the stubborn shorts (who obviously haven’t watched PennyStocking or else they’d be out looooong ago, as I was) into the market close (I saw the morning spike above previous high of $9, but I don’t like buying, let alone buying morning spikes), which coulda woulda shoulda been bought for a probable gap-up/possible big-time morning spike tomorrow.  

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Trading Means Never Having To Say You’re Sorry

It’s trades like MXC that really make my blood boil. While PDO was a near perfect trade—even though I profited 30 cents/share, it’s now down $1.25ish just 1 day later (gotta love not being willing to risk it while traveling!)—as I posted, I never meant to enter MXC at all so this morning I just played it safe—as usual, lately—covering at the open at $10.50. Sure, now it’s already dropped down to $9.25 and this could be the ultimate top, but also at the open, somebody bought 10k at $10.80 and there was no telling if a big squeeze would be on or not and since it’s definitely not an ideal trade, I wasn’t about to double up.

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What My Friends In Town, Upcoming University Speech And Website Launch Mean To You

I can’t even imagine how Arrington copes. Right now I’m blogging, researching potential trades, executing trades working on the new site and answering on average 300+ emails/day (no matter that I’ve repeatedly asked you guys to ask questions HERE) and I still can’t keep up. I think I’ve spoiled you; nay, I know I have. So for the next week or so, you’re gonna have to deal with my crazy schedule, friends, university speeches (University of Minnesota whaaaaaat!) and the launching of THIS new site on May 1st because I’m gonna be overwhelmed. My apologies in advance.

The good news is that once the new site is up and running smoothly, probly in the next month or so, and all the lazy people inevitably choose summer fun over hardcore learning and research, everything will be back to normal—nay, better than normal cuz the new site has a lot of features to make this more understandable to beginners—so celebrate!

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Just Who The Hell Do I Think I Am And Why Should You Care?

It’s astounding how many lazy people refuse to click the ABOUT tab on this site when they want to know more about me. Instead I get anywhere from one to three dozen daily emails asking me—since I have an answer every email policy, I’m beyond tired of this. Guys, chicos, if you want to know how I got started, what kinds of stocks I trade, how I made so much $ so quickly, my life is an open book—literally–An American Hedge Fund. Hopefully this post can save me a few emails so here’s a quick rundown of my journey and how I’m gonna help you:

-My obsession to become the best tennis player led to a career-ending injury senior year of high school in 1999. Since I’d already gotten in to college early and the doctors orders were to rest, I had nothing to do so my parents gave me control of my $12,415 in Bar Mitzvah gift money to play around with and I opened a discount online brokerage account.

-My parents thought I’d lose everything, but after concluding all the most popular stocks were too expensive / random for me, I became a penny stock day trader and turned my little account into $2 million by the end of 2004 (no leverage used). The first $1 million was pretty much all buying breakouts (I focused on chart patterns, little did I know why the charts were so perfect), the second $1 million was pretty much all short selling (when I discovered their charts were perfect for a reason, manipulation!). (Trades, strategies used and lessons learned are all detailed in my instructional DVD PennyStocking)  

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Did I Do That? Pump & Dump Exposes And Revolutionary Finance Websites

With my CNOA pump and dump expose last night and it’s 25% tankage today, I gotta wonder:

Possibly, probly, who knows…too bad I wasn’t short the stock myself—gotta learn to short sell these suckers BEFORE I chop ‘em to pieces, a la business models of Citron Research and Mark Cuban’s ShareSleuth.com

Nahhhhhhhh a.) it didn’t fit my pattern and b.) it’s more fun to write brutally truthful articles about stocks in which you have no positions, you do it just cuz it’s the right thing to do

I’ll tell you one thing I definitely did do right, that’s hiring and tirelessly working with Pallian to design the new site, which is looking redonkulous! I mean the guy is an Indian Picasso, he should be called Ghandcasso or Picandhi. To you lucky 50, advertisers and bloggers, the beta invites are being emailed out, so def. let me know what you think—what you like and don’t like, the site is for you—and for everyone else, you gotta wait til May 1st and settle for clicking the little thumbnail below:

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First Quarter 2008 Review: Earn 21% Every 3 Months And You’ll Live A Happy Life

Coming off my best week since I started TIM 5+ months ago ($900-ish profits), it’s good to review past successes and mistakes. Without further ado, I give you the first quarter of 2008 in a nutshell, where TIM used small account size–finishing at $17,388–combined with PennyStocking to thoroughly dominate the performance of ALL major indexes, even while making tons of mistakes. Follow along and learn to do the same…already 5% higher in April and I’m just getting warmed up…

Successes:

How I Made An 8% Return Before Lunch

How I Made 25% Just By Holding A Distinct Pattern Overnight

How I Made 8% In One Morning, Leaving 40%+ On The Table One Day Later

Why My Strategy Works Even For Stupid People

God, I Love Short Selling Penny Stocks!  

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Short Selling Penny Stocks: Decent Profits But The Mistakes Remain

Late Wednesday, when I posted this article predicting a 25% drop in (PSTI), I thought it’d be over and done with by Thursday. But that move didn’t complete itself til today, my baaaaaaaaaaaaaad!

Can’t believe I covered my short above $4, too much of a lil bitch to hold this sucka. Sure, hindsight is easy, but look at the eerily similar price action after the last spike…probly more downside Monday. How about this, I’ll just go on predicting, you guys handle the trading, deal? :)

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