Warrior Trading Blog

Big Wins Baby +$9,516! | Ross’ Recap

ross recap 7/24

What’s up everyone? All right, so this is a surprise day. I wasn’t expecting a big green day today at all. I thought today was going to be, you know, the fourth day of kind of choppy momentum.

 

It was slow Thursday. It was slow Friday. Yesterday I lost $32.00 so I was like, “Well, we’re in a choppy market. We’re in a slow market. I’m going to have to take it really easy today, 7,500 shares, max size.”

All right, first trade, lost $600.00. Second trade, lost $1,300.00 and I’m thinking, “Even with 7,500 shares now I’m down $2,000.00 on the day. Man, I don’t know if I’m going to be able to get out of this. I’m probably going to be closing the day red. It’s probably going to be my third red day of the month.”

Then, I started to dig my way out of the hole. I had a $200.00 winner, so got out of the hole a little bit. Then another small winner, so then I’m down about $1,300.00 on the day, and I’m thinking, “All right, you know, let’s see, maybe I’ll actually get myself back to green today,” and boom red to green move pops up on the scans, and that was the big winner. I wasn’t expecting it at all. It was a higher priced stock. Got in at $9.65, with a total of 1,400 shares, so started with small size. It ends up getting halted. It opens higher. I add 2,500 shares at $10.50. It squeezes up to $11.00. I add another 2,500 shares at $11.00. Squeezes up to $11.20. I add another 1,300 shares, and now it’s halted on another circuit breaker. It resumes, and it’s a high of $12.88. Boom, $10,000.00 on that trade, just like that.

This is a go-to set up that we teach in the classes and I trade on a regular basis. It’s a reverse split momentum trade. Big winner and I needed it, so now I’m up $53,000.00 on the month, and $703,000.00 in the account that I started with less than $600.00 about 18 months ago. Just like that, from $600.00 to $700,000.00. That means I am 70% of the way to the big million dollar mark, $296,000.00 to go, five months to do it. I need to average $60,000.00 a month to get to one million dollars inside of two years. That’s the goal. We’ll see if it can be done.

Anyways, I hope you guys enjoyed the recap today. Any questions, any comments, leave them below, I’ll come back and answer them later. All right, enjoy.

All right everyone, so we’re going to do our midday market recap, go over the trades from today. Today was a crazy day. I mean really, out of nowhere a big green day. I really, I wasn’t expecting it. We’ve had the last three days slow, choppy markets, not very good follow through, and then all of the sudden today, one really big opportunity, so just like that things can turn around pretty quickly.

I’m just looking on Facebook and for some reason it looks like it’s broadcasting a black screen. Let me know if you guys can see me. It might just be my Facebook feed. I’ll just check on my computer also, my other laptop. Let’s see, you see me? Okay, all right, well that’s good then.

Yeah, so here we are today, up $9,516.31. I did not expect it at all. I thought today was going to be another slow, choppy day. It was slow and choppy on Thursday. Slow and choppy on Friday. Yesterday, I lost $32.00. I was expecting that it was going to be another slow day, and then all of the sudden, really out of nowhere, we had this one opportunity, so what’s really important is that in my first four trades today, I lost money and I was down $1,400.00 on the day, but I wasn’t at my max loss, so I was able to keep my losses small enough that I didn’t hit the max loss. If I had hit that max loss, I would have had to walk away for the day. I’d be done, and then I wouldn’t have been able then to get the one trade that gave me basically the rebound.

I always try to keep that last trade in my pocket if I can. Now if I end up blowing through my max loss, you know it happens sometimes, and it’s the way it goes, and the most disappointing thing is that it means I, even if a great opportunity shows up later in the day, I’m not going to be able to trade it, because you have to follow the max loss. You have rules and you’ve got to follow them, so red day minus 32, yeah. A green day plus 9,500, that’s a pretty good profit to loss ratio. I can definitely live with that, but I was down $1,900.00 today at the lowest, so my high water mark, as you’d say I guess, was negative $1,900.00.

I started with two losers, and I kind of have a rule of thumb that if I have three losers in a row, I’m done trading, and so I was pretty close to it. First loss was on RIS. Now this probably, for some of you guys watching in the chatroom, who are beginner traders, some of you guys who are on Facebook or YouTube, you’re like, “Geese Louise, $9,500.00 in one day, how is this possible? How is this happening? How is this the …” Let’s see, one, two, three, four, fifth, sixth day that I’ve made more than $8,000.00 this month. This is ridiculous. It really, I know that I kind of can make this look easy, and it’s because I’ve been doing this for a long time, but the reality is I’m doing the same thing every single day.

The only difference between me making $9,000.00 today and one of you making maybe $900.00 is share size and the conviction to sometimes hold through dips because I’ve been in the market long enough that intuition can sometimes guide me through those tough moments, where you have to decide, “Do I bail out or do I hold on?” I’m going to leave this here for right now. We’ll come back and look at the PNLs.

Today started the same as any other day, looking at the high a day momentum scanner. All right, so this is our GAP Scanner, so we’ll run this scan for 9:00 a.m. All right, so 9:00 a.m. this morning, we’ve got a few stocks on the watch list. All right, so SCON is the leading gapper in the entire market right here, and I’ll be honest, I wasn’t interested in it. I wasn’t interested because I thought it was too expensive. Now, when I was looking at it, to me it just sort of was like, “Well, I don’t know. It just seems too expensive. I just don’t think that I can trust it. I’ve not had a good run the last three or four days. It’s not worth pushing my luck on a $10.00 stock. I’ll just look for something else.”

Initially I was like, “No, don’t like it. IG, no don’t like it. It’s too cheap. PLX, too cheap. MARA, kind of a little too cheap. I don’t really like it. ACET, not enough volume. TOPS, don’t like that stock and it’s too cheap. RIOT, that’s the first one on the list that I like, right here.” RIOT was number one, so this stock is gapping up 15%, all right? That’s a pretty substantial gap. It’s not as big as SCON, but it’s a substantial gap, so it’s gapping up 15%. It ends up squeezing up to a pre-market high of 784, so when the bell rings, it shows a little bit of weakness, and then it pops up.

I’m going to back this out to a 10 second chart. I don’t use 10 second charts while I’m trading, but sometimes I’ll show them to you as just sort of an example of what I was seeing in the first few minutes because it’s so volatile. All right, so now you can kind of get this picture. It dips down, and as it surges back up, I got in at 68, so I jump in this at 768 with 5,000 shares. All right, so 5,000 shares times $7.00, it’s like a $35,000.00 position, so you know, dollar amount, decent size position. It pops up to a high of $7.77, so I sold half. I was like, “Okay, I’m going to take some profit. I’m going to sell half.” I sell half, and then it drops all the way back down here, and I sold the rest at $7.38, and I ended up losing on that trade $670.00. You can see here, I’m in at 70. I sell half at 74, 75, and I sell the rest at 38, so boom. That’s a real bummer, so that was disappointing. Starting the day red $670.00, that’s not what I wanted, so that was trade number one. I didn’t get back in it. It didn’t give us another opportunity. It’s just been weak, basically for the rest of the day, so disappointing there.

First strike, all right, you’re out, so that’s one, so strike one, RIOT. Strike two, HJLI, so I take this trade and I lose $1,300.00 on it. Okay, so this one, it hits the scanners, or no sorry, I don’t think this one was on the scanners. I think someone called this one out in the chatroom, and I pulled up the chart and I was like, “Okay, you know it actually looks interesting. It’s a recent IPO stock,” and what we know about recent IPO stocks is that they can be pretty volatile, and in the past they’ve made big moves, so I was definitely interested.

It pops up to a high of 38, and it’s doing a one minute micro pull back right here, so as it’s doing that pull back, that’s when I decided to add for the break over 38. Okay, so on this one I ended up adding, let’s see, right here at 38, and then I guess I filled at 34. I don’t know why, and I tried to add at the half dollar, only filled 300 shares. Tried to sell half, 54, didn’t fill. Tried to sell some at 53, and then I ended up stopping out of the whole thing at 20 and 13, so basically bailing out in this candles it dropped back down. It just didn’t hold up, and as you can see, it just ended up going lower and lower, and lower, and hasn’t been a very good stock today, so disappointing there. You know that’s $1,300.00 in the red, so $1,300.00 on that, plus $670.00 on RIOT.

At this point, I’m down almost $2,000.00 on the day, and I’m starting to think, “Okay, well this day is getting a little out of control. This would be my second biggest red day of the month if it keeps going in this direction.” I was sort of like, “All right, I really need to turn it around.” I see PIXIE, now someone calls out PIXIE in the chatroom. They’re like, “Hey, take a look at PIXIE, it’s popping up,” so I see it popping up, and I jump in it, and even though I told myself today, I wasn’t going to trade more than 7,500 shares, I jumped in PIXIE with 12,500 shares. This is, I’m so bad at not doing that. This is where it really gets me because if PIXIE had gone the wrong direction really fast, probably would have lost $1,500.00 on it, and had been down $3,500.00 on the day, and that would have been my third loss, and I would have been out.

What I saw on this that I really liked was the daily chart, and I thought, “This looks good as it’s kind of curling up here, possibly retest of 446,” so I jump back in it. Now again, 12,000 shares of this stock is like a $50,000.00 position, so putting a good amount of cash into it, and you can see it pops up here. It squeezes up to a high of 84, and I’m able to sell and take some profit, so $550.00 profit. Actually, I was up more like $1,000.00, or maybe $700.00, and then I sold the rest as it came back down, scaling out some break even, and then the rest at a loss. This was disappointing because I was like, “You know, look at this, another one that’s not holding up,” and so at that point I was down, I want to say like $1,300.00 on the day, or something like that. Recovered some of the loss, but not all of it.

BLIN, I jumped in that one. Jill was in, I think Jill was taking that one as a trade today. I got in for the break of $2.00, at $1.95. It’s a whole dollar break out set up. That was right here, and it hit $2.00 and then sold off, so 7,500 shares on that. I only made $180.00. With that, I was sitting down around $1,200.00, $1,300.00, and then in the room you guys were like, “Okay, take a look at SCON because it’s a reverse split, and it sold off but it’s starting to bounce back up.” I look at it and I was like, “Okay, I see how it is starting to bounce back up here.” You can see right in here, it’s starting to curl. It broke over 9, and some volume came in. It just started to ease back up, and the high a day was 950, so as I saw that, I was like, “Okay, this one, this may be worth watching for a red to green move.” It is a reverse split today.

For those of you that haven’t heard of this term, so reverse split, all stocks on the big exchanges, like NYSE and AMEX, and whatever, they have to maintain $1.00 per share. They have a minimum price that has to be above a dollar, so if the stock is below a dollar for a long period of time, they can get a delisting notice from the exchange. The exchange is like, “Hey, you’re not in compliance,” or whatever, “You need to get above this level.” There’s only two ways to do that, either the company does something amazing, really good earnings or whatever, the price goes up, or they do a reverse split.

When they do a reverse split, it you’re holding 1,000 shares of this stock yesterday at 90 cents, then today you’d be holding 100 shares at $9.00. What they do is for let’s say the whole float was I believe 12 million shares, so the float’s 12 million shares, so they take back the 12 million shares basically. They change the price from 90 cents to $9.00, and then they give back 1.2 million shares, so what it does is it cuts the flow down by 90%. What’s really common is that these stocks will do a reverse split, and then, now that it’s a more reasonable price, you’ll see, it’s very common to see a headline come out, and so the fact that reverse splits and headlines often, not in this case, but often come hand in hand, has created the effect that a lot of times a reverse split will result in a big move. It’s not just because of the reverse split, it’s because of the news that’s usually associated with it, but when these two patterns sort of become combined, it becomes hard to tell, “is this happening because of the split or is it happening because of the news,” and traders are looking for opportunity, so when you see a stock starting to move, and you recognize it was a reverse split, it’s just sort of like, “This is an opportunity.”

I see it squeezing up, and I take a starter of 1,000 shares at $10.50. Now I only took 1,000 shares because I was looking at this, and I was like, “Honestly, I think there’s a decent amount of risk on this trade. I’m not sure that it’s going to be safe,” and I didn’t get filled at 50. I got filled at 65. Let me reset my screen share here. I got filled at 965, with my first 1,000 shares, and then as it broke over 65, it hit 75, I added at 88, so I had 1,400 shares at an average price of, I think it was $9.71, right around $9.71.

All right, so then it pops up here, so it gets halted at a high of $9.88, so I’m like, “Okay the stock is halted. I’m holding 1,400 shares, whatever. I’m down $1,400.00 on the day.” I’m not expecting that this is going to be a home run or anything like that, but I’m thinking first step would be maybe a test of the pre-market highs or a test of the 200 moving average, which is 1089, so this purple line right here. That’s kind of what I’m looking at as being maybe where I’d want to be, seeing a potential profit.

Okay, so it’s halted for ten minutes. It resumes, and then it … Let’s see, on the resumption it dips down for a second, and then it surges up to a high of 1132, so it starts squeezing up. Basically, the way I trade stocks that are halted is when we’re about to resume, I do one of three things. The first is if it opens lower and starts going down, I usually sell and take a loss. Okay, so that’s option number one.

If it opens slightly higher, and is kind of showing weakness, I’ll usually sell half, and if it comes back down to my entry, I sell the rest. If it opens that way, and I sell half, and then it surges back up, I add back what I sold, because now it’s showing strength. When it opens substantially higher, like this opened at 10.29, so it opened 50 cents higher, so when it opens that much higher, I’m just like, “Okay, I’m already up so much on this that I’m just going to give it a second. I don’t need to sell right away, I’m just going to hold the whole thing, and if it curls up, then I’m going to add to my position.”

That’s exactly what I did, so on this one, where is this? Okay so that’s where I added. Okay, so here’s my first entry, so 9.65, I added 1,000 shares, 9.88 I add another 400, so I’ve only got 1,400 shares. I’m not even trading with big size, but it opens higher, and so then I use my hot key to add 2,500 shares at 10.50 when it’s showing strength. I get a partial fill of 1,700 shares, and it surges right to 11.00, so now I’m like, “I’m in the driver’s seat and this thing is strong.” I add another 2,500 shares at 11.00 because now I’m seeing this thing is obviously taking off, so I’m going to be aggressive. It squeezes up to 11.00, I add another 1,000 at 11.20, and now it’s halted on a circuit breaker.

Now I have 6,900 shares, and my average price is 10.61. Now I’m in right about here, and now it’s halted at 11.32, so I’m up 60 cents per share on 7,000 shares, so I’m already up $3,000.00. It’s halted, it resumes and squeezes up to a high of 12.88. Now, when it squeezed up, on this one I didn’t want to add coming out of the second halt, right away. I wanted to start taking some profit, and so I sold, I tried to sell at 53. I tried to sell the whole thing actually at 53, and it didn’t get filled, so then I hit the bid and sold at 19, because I was like, “You know what,” I kind of like was flustered. I wasn’t paying attention to the level two. I was looking at something else, and then all of the sudden I look back and it’s trading, and I’m like, “Oh my God, what did I miss? What price is this at?”

It’s really kind of strange, but I just got distracted for a second and next thing I know it’s resumed trading, and so I immediately switched over and was like, “Take profit, lock up some profit.” It then starts to curl back up, and so I add back 2,500 shares. I got filled 1,100 at 12.63. All right, so 12.63 and then I stop out of that at $12.00 because it didn’t hold up very well. It ended up being a $10,000.00 winner, despite giving back the little profit off the top.

This is, I’ve set up, we’ve got some live examples in the classes of this reverse set up. We’ve seen a couple of incredible moves come off reverse splits. KBSF is just one that I’m thinking of off the top of my head. I think TENX was one. INMT maybe, there’s just been so many, and so I jumped in quickly, was able to capitalize on these, basically $4.00 per share of profit, and out of nowhere I made $10,000.00.

Now, if I had not added at 10.50 and 11.00, and 11.20, then I would have just been holding my 1,400 shares from 9.60, and I could have sold them at 12.00, so from 9.60 to 10.60, to 11.60 would be $2,800.00, so probably would have been like a $3,000.00 winner, right around $3,000.00 of profit. What I decided to do instead was add. What I was risking was that potential profit would have gone to zero because adding brings up my cost basis, and so I could have gotten stopped out break even, so I was risking unrealized profit, but the potential, being that this was a reverse split, and it was squeezing up, and moving quickly, was that it could be a big winner.

I think what this also had going for it today was the fact that really nothing else was that active, so I think traders were more likely, as soon as something started to move, to jump on it a little bit more quickly, just because we’re always looking for opportunity, and there wasn’t a lot of it today, so once there was a little piece of something, it was worth jumping on fast, so this ended up being a pretty decent trade. However, what I’m disappointed with is that it’s really not holding up well at all. We’ve seen this happen, we’ve seen it happen both ways where we see a recent reverse split, we traded on day one, and by day three it’s up at $20.00 a share. It takes off and continues higher and other times it does this.

CHFS, I’m trying to remember when the split was. I can see the splits on my chart here. Let’s see, yeah, so look at this one. Here’s a day where it squeezed from $3.00 to $25.00. That’s a huge move. It was a recent reverse split when that had happened. Here’s another day, a reverse split gave way to this big move. Oh no, that was before it, so that was different. KBSF, this one I know did a reverse split break out, at least once. There you go, there’s a reverse split break out. That’s one, was there another one? No, that might have been the only one, so it’s really common to see the set up, and I’m definitely pretty aggressive whenever it starts to form. TENX, I’m trying to remember. This one did a reverse split break out in March. You can see right here, so we see these pretty regularly.

BLXL was the last stock I traded today. This one was a recent IPO break out. As you can see here, that’s the set up I was thinking would happen on HJLI but it didn’t, but this one started to pop up, and I jumped in at 4.82, right here, and 4.78, I guess. I added at 32 and 39, and sold at 50, and then added back at 50, and sold at 44, and then the rest coming down at 4.91, so that was kind of a sloppy trade, had some profit but gave it back. I think at that point I was pushing it a little bit too hard. I was trying to really maybe turn this into a big, big day, and I just don’t think it was really in the cards, so not a $10,000.00 day, but $9,516.00. Green is good, and you know, definitely a surprise day.

Again, going back to the fact that this morning I started with small share size because I expected the market would be a little choppy, having been choppy Thursday, Friday and Monday, so didn’t expect to see a lot of follow through. It was choppy to start. I was down $2,000.00, and then all of the sudden there was this big turn around, and boom, took off and made some good money on it. The most disappointing thing is that the two stocks that I traded, those two didn’t hold up very well, and that’s in keeping with the fact that in general, most of the stocks we’re watching today haven’t held up well.

The market is still on the weak side for these small cap stocks. A couple opportunities, but staying power has been a little bit more difficult. It looks like BLIN’s holding up the best of all of them, but it’s been a slower mover. I would say tomorrow, I’m still going to keep 7,500 shares as my starter size, out of the gates, and if we see things open up like we did today, or an opportunity strike, I’ll be aggressive, but again, 6,000, 7,000 shares of this SCON, for me is still not even big size.

Big size would have been taking 10 or 15,000 share of it, so in a stronger market, I would have been more aggressive and in a stronger market we might have seen more buying volume. We might have seen it move up to 15, so despite a good trade, I think the market is still a little slow, and I think we still have to be a little bit careful. We’ll try to be smart tomorrow. We’ve got one, two, three, four, five days left in the month, and right now I’m crossing over $53,000.00 of profit on the month, which is pretty awesome. $53,000.00 on the month, $368,000.00 on the year.

I’m about, let’s see, I’m actually only about $10,000.00 off last year’s highs, so I’m getting very close to breaking last year’s total profit and it’s only July, which is awesome. That means anything from, you know, this point forward, from August forward is just extra profit. Sitting at $703,000.00 in my account that I started with $583.00 about a year and a half ago, so $296,000.00 to go before I cross the one million dollar mark. That means I need to average $3,087.00 per day for the rest of the year. It’s a marathon, but I’m now 70% of the way there. We’ll keep it going, and again, I know for some of you guys this all seems crazy, the market’s moving so fast. You might feel a little overwhelmed, and that’s okay to feel that way at first. It’s a learning curve, and I don’t want you guys just to try to be in the chatroom following me.

I say it every day, but that’s not a sustainable method. You’re not going to make money doing that. You need to learn why I take the trades I take, why I get in where I get in, because the reality is the difference in one second can be the difference between getting in at 9.50 or getting in at 10.00 with some of these stocks, so you need to be able to execute 100% on your own, just the latency between when I’m talking, through the mic and stuff, this needs to be real time.

You need to be able to act, so my goal is that I’m able to teach you and sort of guide you, show you what’s moving, and that you’re able to execute and make those decisions yourself. I saw a lot of you guys did. A lot of you guys have great trades today, but some of you guys also got in, you might have missed the first opportunities, got into BOXL, where I added, up at the half dollar, and then stopped out, coming back down. That’s what happened to me, I lost money on that drop, but I had a profit cushion to take the risk, so that’s where I was like, “Okay, I feel comfortable taking the risk because of where I’m at on the day.”

Anyway, that all comes with experience and you know, this is a job where survive til you thrive. All right, so writing it down, the 134th day of the year, almost $10,000.00. Green is good, all right? I hope you guys enjoy the afternoon. Get some rest, study up a little bit and we’ll be back at it first thing tomorrow morning, bright and early, 9:00, 9:15 for our pre-market analysis. All right, see you guys in the morning.

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