Following Fannie Mae trade, I took a few days off to settle down, as that FNMA development (doubling up and getting out before it dropped) got my blood boiling with excitement 24/7 and I did not think that that was a productive mindset to go into a next trade with.
As very proud as I was of that realization, I was even more proud of the way I spent those following few days before my next trade. As mentioned earlier, I was very intrigued by Nate Michaud's InvestorsLive DVD, as well as some other trading gurus' services and instructions. After bothering some nice folks on twitter (@VeritasGreen - thank you for your time man!) in search of answers regarding Nate Michaud (@InvestorsLive), TimSykes, Superman etc., I finally gathered a critical mass of information and decided to go with Nate's - InvestorsLive DVD. As said earlier - it was pricey ($1k) but I have to say very much worth it. Within almost literally hours, I made that $1k back... almost 4 times over. Now to be clear - I am not a pumper for his service, I do not and have never worked for the guy, but I do give credit where its due. And his DVD does deserve it, no second thoughts about it. You should know that before I submitted myself to his DVD class, I did have just about one year's worth of experience with the market, investing some, trading some, but primarily learning bits and pieces about technical analysis from many random sources.
What that $1k bought me in that DVD was a horse dose of confidence. It defined very clearly high probability setups, and gave me a comprehensive overview of everything a trader should know, and more importantly should and shouldn't do. For someone like me who was self taught - the presentation of an organized system made all the difference in the world.
So then, last Friday (03/14), with a cool head and backed up by the lack of a feeling that I am winging it, I screened the charts and decided that GrowLife, Inc. (PHOT), even though coming off of a move up - still had more to go and was consolidating before the next leg up. Afterall, this is the time of weed stocks and they are practically flying from pennies to dollars overnight. I bought PHOT on Friday, held through the weekend. Got a nice little gap and run action out of it on Monday, before I sold it for about 20% gain, some ten percent short of its total day range - but hey - I was happy with that and I locked in profits before the ride got too turbulent. I was even more inclined to do so when I tried to exit my positions at the top of the first high of the day (HOD), and could not get it to fill my order. It was an OTC penny stock afterall and apparently these types of things happen more often than not in OTC stocks. The following day (Tuesday 03/18), PHOT gapped down at open, went down almost 20%, and closed 11% down. To say that I was really happy with my timing would be a gross understatement.
Finally - sitting all cash on the sidelines today and browsing my watchlist at market open, I noticed mCig, Inc. (MCIG), another weed stock, inch its way towards the critical area of resistance. As it was moving with some momentum, I anticipated its move, set my order just to where the breakout was confirmed and watched it as it took me on one helluva rollercoaster all day, which ended in almost 12% gain for the day, on more than double 50 day average volume. I am holding it overnight expecting gap and go play in the morning.
One of the biggest things that finally clicked in my head recently is the importance of finding tickers whose charts look similar on multiple time frames i.e. weekly as well as daily. The best way I can describe it is that having the weekly chart line up with the daily is like having your big brother watch your back in a fight. It takes the level of uncertainty out of the equation, therefore justifiably increasing your risk tolerance.
Some of the other stocks I am looking at the moment:
CTIC, AEGY, PEIX, AGIO, DANG, GLCO, Z, WWE, BIG, INO, TRTC, PHOT, FROZ, MJNA, SKTO.
Please be advised that I am NOT a professional trader, nor the financial advisor of any kind. Expressed opinions about stocks are my own interpretations and not trade reccomendations in any way.
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