Warrior Trading Blog

Taking It Easy Today +$110 | Ross’ Trade Recap


Hey everyone. All right, so this morning, finishing another green day of trading, seventh green day in a row. Up only $110 but, hey, progress is being made. I’m totally okay with that. Today is the day where I wore red to remind myself to take it easy. Red flag is out, go easy. Monday, GNCA fell over, CTRM yesterday. Today, RWLK, well, it dropped significantly just before the bell, a headline at 9:15. I just felt like today was not the right day to be aggressive. I eased off the throttle. The only trade I took was with 1,000 shares. I made 11 cents per share, $110, and that’s it. I just didn’t feel that I could trust anything more than that.

Now, I tried to take a 3,000 share position. I only got a partial fill. That’s because the stock moved so quickly. That’s fine, that’s the way it goes sometimes. If I had taken the full 3,000 shares, maybe I would have had $300 or something like that, minus a little slippage but, again, it’s just a day of rest between strong momentum stocks. I think it’s just really important to be able to recognize the market that we’re in. When it’s hot, I’m going to be super aggressive. When it’s cooling off a little bit, I’m going to step back. I’m going to sit with a nice cushion of profits from a really great couple of weeks of trading, and I’m going to wait for the next [aquality 00:01:25] opportunities.

Reminder, tomorrow, 1:00 p.m Eastern, I’m going to host a free workshop where I’m going to break down the five criteria for a stock to have home run potential. I use those criteria to help me evaluate whether or not a stock is worth being aggressive on. This is a great time to attend that type of workshop. If you’re not able to attend the live event, you can still register. We’ll send you a replay, which is totally okay. This is a period of time when momentum is little slower, where you’ve got to be really selective. Trade the best, leave the rest. All right, see you guys first thing tomorrow morning.

All right everyone. We’re going to do our Midday Market Recap. I’m not going to take anymore trades. I see RWLK moving back up a little bit, but I’m not that interested in it. It’s at the 200 moving average daily resistance, 16 million shares of volume today. Of course, it was gapping up over 200% this morning, up at $11 and then, boom, dropped down to 750 on this news of exercising warrants resulting in cash proceeds of 10 million dollars. This, for me, I just didn’t see any good, low risk opportunities to trade it.

This morning, before I even came into the office, before I was even looking at any of the gap scanners, I put on this red sweatshirt and I told myself, “Go easy today.” Yesterday, Monday and Tuesday were both kind of orange flags. I think now there’s a red flag up. It’s because on Monday, we had GNCA which was a pretty weak Gap and Go stock, actually about as weak as it can get. It gapped up and sold off the entire day, closing at the lows.

What happened yesterday, CTRM did the same thing. When you have really obvious strong momentum stocks that get knocked down like that, it’s an indicator that momentum is starting to shift. Rather than just ignoring that and continuing to trade aggressively because, last week, the market was so hot, I really wanted to stay present with what’s going on right in front of me in the market and to adjust my strategy to this shift in momentum. I’m going to finish my seventh green day in a row here. Even though I’m only up $110, green is good. Progress is being made.

What’s great is that it’s not a red day. This was a day where I had a really high likelihood of being red. I didn’t want to lose sight of that. I didn’t want to forget about that. I wanted to be conservative. The first thing I did today was reduce my share size, my max share size, from 15,000 shares down to 6,000. Now, this says do not allow and I put it at 6,001, because I want to allow myself to take 6,000 shares but not more than. I put it at 6,001, so my max size is 6,000.

I reduced my share size today. Let’s not forget, we’ve had a fantastic last seven days of trading. I mean the market has been really, really good. These last two days were a little bit more difficult. As I came in, the first stock I was looking at was RWLK. When I was looking at the gap scanner at 9:15, I was like, “This is the one.” Let’s see, let’s do 9:10. At 9:10, this thing was gapping up 200%. Three million share flow, 2.5 million shares of pre-market volume. I was like, “This is the Gap and Go stock.”

Now, I thought that there was a risk that it could sell off, like GNCA and CTRM. I thought at least it would give a good Gap and Go setup. Then, right at 9:15, news comes out, pre-market was right there and the stock drops back down. One of the reasons we don’t take pre-market trades. Drops down and then, yes, bounce off the low but I just didn’t trust it. I didn’t want to push my luck on it. That one was off the watch list by 9:15, 9:30. This one didn’t have enough volume. This one was too cheap and the float was too high. This one doesn’t have enough volume. This only had 300 shares. This, 72 shares.

Pretty quickly, you’re seeing that, wow, there’s not a lot that looks good this morning. Floats too high, floats too high, too cheap, too expensive, too expensive. SOLY is on the more expensive side. Of course, it was a five, $6 stock a couple of weeks ago. I guess actually the low was $5. Yes, it’s gapped up here and been holding this level relatively well, but lots of dojis, one, two, three, four, five dojis including today. It’s just not easy stock to trade. I’m leaving that one alone. Pretty much, that was it.

There was nothing on my scanners this morning for a Gap and Go trade. That’s okay. Some days are like that. I would say four out of five days each week, I am able to find a good Gap and Go trade. Today, I wasn’t. Given the fact that we had a couple of close calls yesterday, the day before, and today, clearly, I had no Gap and Go trade, I decided that I would just sit tight and wait. Basically today, I could have easily gone without taking any trades. RWLK was on the scans, kind of popping back up. Obviously hindsight 20/20, it did move. I just thought that this price action was a little bit more difficult.

I didn’t really want to do a red to green type of setup on it, because I just felt like there was too much weakness from this drop. Did break over $9 right here and sort of struggled at the VWAP. You could have traded it. There was some opportunity. I saw some of you guys did trade it and made some money, so good job for those that did. For me, I just felt the risk was a little too high.

Watching stocks on the scanner, IFMK, lower priced, wasn’t that interested. There really just wasn’t a lot here that looked great. GNCA popping up here, 1036, potentially moving up but it’s going to run into resistance up at this moving average. The only stock I ended up trading was [COOL 00:08:25]. This one was kind of funny, because it’s actually a reverse split. The stock did reverse split, as you can see right here, and I was like, “All right. I’ll keep an eye on it. We’ll see if it does something interesting here.” It pops up to a high of $2.95 right here. It then pulls back. It ends up breaking over that level.

I prepared an order at 310 for 3,000 shares. I pressed the buy button and it popped up before I could even… I mean I only got 1,000 shares of that order filled. I left the order there. I was like, “Oh maybe it’ll fill the rest of it.” It didn’t. I was like, “Well, okay. 1,000 shares, do I want to add to it? Or do I just want to leave it alone?” I decided just to not add to it. It popped up to 333, dropped back down and I stopped out with a small profit.

GNCA looks like it’s about to get halted right here at 65. I think what you’ve got going on here are traders jumping on momentum stock or former momentum stock. Unfortunately, for me, when you have a stock that’s in the shadow of this big, red day, it feels hard to trust. There’s a 75,000 share sell order that just flashed there, 750. You’re going to have sell orders lined up on this thing. It might gap up a little bit. It might make a move up towards seven. It’s possible that traders will end up jumping on it just because, hey, something’s finally moving today.

You can see how it hit the scanners, people started noticing it, volume increasing. Stock starts moving up, so this is a high day scanner type of alert. I just feel like the risk, I don’t know, especially now at this time of day at 10:30 as we get further and further away from the open, is just too high. For myself, one of the things I will say is that when I’m having a day like today where it’s 10:30 and I’m only up $110, that, by itself, is an indicator that I should just get as far away from the computer as possible. I should not keep trading today.

By this time, I should be above my daily goal of 2,000. Now, if I keep trading, there’s a very good chance that I’m going to go red on the day. It’s just not worth it. Whatever, I’m just going to leave this alone and not give into FOMO. That means one of the best things I can do is going to be to shut it down, close down eSignal, close down my charts, not sit here and stare at the market. That’ll get me looking at stuff, so I’m just going to shut it down.

Now, remember guys, tomorrow, 1:00 p.m. Eastern, I’m going to host a free workshop where I’m going to walk through my five criteria for evaluating a stock for whether or not it has home run potential. That’s the reason I only took one trade today. That’s the reason, in the last seven days of trading, I’m up over $30,000. It’s because I’m very selective about what I’m willing to trade. Learning to be selective will help you hone in on the stocks with a lot of potential and avoid the stocks that just don’t have as much going for them. I’ll post the link here in the chatroom for you guys. You can reserve your seat there.

Tomorrow, June 6th, 1:00 p.m. Eastern, I’m looking forward to that workshop. We’ll do our regular morning routine. We’ll trade from 9:30 until 10:00, 10:30, whatever the case is. Then, Midday Recap, and then I’ll switch gears around 11:00 and start getting organized for the workshop at one o’clock. This stock, GNCA, the time stamp of the last trade right here is at 10:38 and eight seconds. That means it should resume at 10:43 and eight seconds. It should be a five minute long halt.

I would expect this will be a five minute long halt. I don’t think it’ll be difficult to match orders. You’re going to have bag holders who likely just left sell orders out at random places. As the stock gets ready to resume, they’ve got to balance and match the sell orders with the current buy orders. Let’s say someone did a market order going into this halt, or let’s say someone has an order right now. I could put an order on this thing, 650, and press the buy button. That’s going to be a live order that, on resumption, they’re going to need to try to match with a sell order. Right?

On resumption, orders match and if they can’t match those orders in five minutes, then the halt continues for another five minutes. Then, you’ve got a 10 minute long circuit breaker halt. Typically, when stocks are halted for 10 minutes, they open significantly higher than when they’re halted for only five minutes. Let’s look back on SOLY while we wait for this to resume. I’ll let it resume just so we can watch it. Resumption here, if it’s a five minute long halt, in a little less than a minute.

All right. SOLY, we’re going to go back on this one to the day that it made the big move, which is right here. No, one more day. Where was this? All right. On this one, you can see the stock squeezed up to a high of 683 and then resumed at 740. It resumed 10% higher meaning if you bought going into the halt, it was an instant 10% winner. The stock at that time didn’t have a lot of previous action, and so it was able to just really take off. Let’s watch this, resumption should be here. Okay, hasn’t resumed yet.

There’s resumption and it’s resuming just a little lower. Right? Not surprising. Now, the [inaudible 00:14:48] is where I would be a buyer typically over 65. I’m not going to do that on this trade. The high is 65. As I said, I think that this is too much risk with this shadow of this red candle here. I was able to avoid a 10,000 share position and potential $3,000 loss on this, because I knew that this stock didn’t meet my criteria. That’s that dip buy opportunity right there. Again, you’ve got a high of 85. The fact that it didn’t open higher for me, I wouldn’t usually do a dip buy on it.

I do a dip buy when they open higher and dip down. When they open flat and dip down, I, personally, don’t take that trade because it has too much risk. Could I have taken it and quickly gotten in and out? Maybe, but it wouldn’t have been easy. This is part of the deal of learning how to trade, being able to navigate through choppy waters, being able to identify stocks with home run potential and avoid ones that have a very high likelihood of giving you a fake out and then unnecessary loss.

All right, so that’s it for me. 10:45 here, going to shut it down. Live to trade another day, be back at it tomorrow. Hopefully, we have a good gap scan in the morning, make some money in the first five minutes, and then build a cushion and use that to take trades two, three, four five as we get further into the morning through the opening range and up to 10:00, 10:30. All right, I’ll see you guys all first thing tomorrow morning, 9:15, for pre-market analysis. Bye everyone.

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