Chinese Stocks Are Today's BIGGEST Gainers transcript

all right everyone well we're back at it here Monday morning and today it's the last day of September so September is now in the books I am done trading not going to take any more trades today so that means September is locked up which is great and we've got a new month right around the corner so typically I get excited for the end of the year October November December this has always been the time of year that I get excited I think historically I I did better in the fall sort of you know I don't know just like there's more momentum in the market 's more action there's more news headlines Summer's always a little slow so you know this summer happened to be pretty good but that also gets me excited to think if the summer was good what's the fall going to be like so anyways we're coming to the end of September and locking up today uh another Green Day which is good nothing crazy base hit day for the most part green on four out of four stocks I traded I did uh trade a little bit more today than than a couple other days um you know the thing was well we'll get into it let's let's start with the first trade of the day all right so we'll go to the top of the list first trade of the day um zcmd so if you watched my uh game plan for the week ahead which of course I post um for you guys on um the YouTube channel uh and hopefully you guys saw it my game plan for the week ahead posted last night or yesterday afternoon I guess it was um in that episode I said I would be watching zcmd for possible continuation on Monday and the way I found it was by using my scanner here which is um my top after hours gainers where is it I always lose track of this um there it is after hours top gainers so zcmd was the after hours leader on Friday now I don't usually have a lot of interest in I I wouldn't hold something overnight from Friday to Monday I think most people probably wouldn't want to hold over a weekend it's kind of unnecessary risk um but but nonetheless uh it it was you know the leading gapper on Friday or after hours so I thought well I'll keep it on watch here Monday morning and maybe it'll continue uh into today so this morning when I first pulled up the scans it was about I don't know 6:30 6:45 I pull up the scans and I see zcmd as our leading Gainer at that point it was the leading Gainer on the day and we really didn't have much that looked great so I was like all right well you know okay this is zcmd now I I did note what some of you guys has said that although there wasn't a specific Catalyst on this we did have um the larger Catalyst of um economic stimulus coming out of China and so Chinese companies you know getting maybe just that sympathy boost in fact Duo which is up right now is also a Chinese stock so so that may in fact be um The Catalyst and and that's that's it because there's not a fresh Catal there's no there's no news uh otherwise but anyway so I sat down here at my desk around quarter a s pulled up charts scans and started to get kind of organized and that's when I saw zcmd doing this pattern now at this time here I looked at it and I thought well you know I don't know that I'm going to want to take a trade right here because that was at about um it's about 6:55 it was a little before 7 a.m. now at 7 a.m. look at the volume Spike big volume comes in right at 7 a.m. why because 7: a.m. is when retail trading brokers come online so thinker swim E Trade Etc you can't trade before 7 a. with a lot of those Brokers so this started to pull away before 7 am. but I was like I don't know I think I think I should kind of wait till like 7 a.m. so what I ended up doing was um it pops up here it pulls back and on this pullback right here this ended up forming our first micro pullback right there so it squeezes up it dips down and I got in at 248 now now with this one there was a little bit of an issue which is that well currently has 47 million shares of volume and it was pretty thickly traded so when I was looking at the level two at that point early this morning you know it was 248 246 sort of on the bid coming back down 249 on the ask and there were a lot of buyers on the bid but there were also a lot of sellers on the ask so the level two is pretty pretty thickly traded I'll show it to you um Let's see we actually um so will pull it up zcmd so right now it's it's still pretty thickly traded pretty stacked on the bid pretty stacked on the offer so for this stock I felt that I needed to take larger share size in order for the first trade in order in order to really make any money on it I didn't think this was the type of stock that was likely to drop 15 or 20 cents I also didn't think it was going to go up 15 or 20 cents so basically when I pulled it up I said well realistic Al I'm probably looking at 5 to 10 Cent Winners on this I'm thinking it's going to break 250 but I don't even know if it's going to get to 259 259 was the pre-market high right up here so even though that was my target that's only 9 cents a share so on this one I said I'm going to have to take larger share size and I had to ask myself is that is that okay you know your first trade on Monday taking bigger share size H that might be a little risky should you do it I'm not sure and when it was first moving right here I I as at 240 I was like no I don't think so but as it popped quite nicely up from about 230 to 250 I said you know what I'll give it a stab so I bought 7500 shares at 2 248 all right it breaks 250 it goes to 254 and then right at 700 a.m. when it breaks 255 I added another 5,000 shares it breaks 255 it goes up to 266 and it squeezes up to a high of 269 and right into that squeeze I took my profit off the table so on 12,000 shares it was a 12,500 shares I pulled um well $1,600 a profit out of the market which is yeah 121 so yeah about 12 cents a share that's not bad I mean to be honest that's better than I expected and I did it without really taking what I felt was more than a couple hundred of risk cuz when I was in at 248 right my entry here two 48 we had 247 on the bid and I was thinking hard I mean for me I was thinking 7500 share position 7500 shares which dollar size is not that big it's not even a $225,000 trade but I'm thinking all right I'm in here at 48 stop I was sort of thinking 245 right because we had buyers at 46 so 241 this is a stock that had 1 cent spreads so it wasn't like it was jumping you know all the way down or dropping all the way down potentially 235 225 215 so for that reason I felt confident um but I also uh 249 250 251 you know seeing the level two stacked up like this I just didn't know if we were even going to get that move to 259 so we ended up getting it broke the ice first trade of the day $1600 of profit that was the only trade I took on zcmd that was it just one trade and then when it pulled back here um I was thinking all right well unfortunately now it's starting to look like a head and shoulders pattern so the head and shoulders is uh this first move up bull flag move higher and then stalling out and coming all the way back down to the previous level right so kind of like this and then like that and then dropping back down uh and that's ended up you know not exactly what happened but it wasn't able to get back up so that was zcmd one trade on it that was it and that was right at 7:00 a.m. so then after that I was like okay good job broke the ice that was your cushion and then I didn't take any trades at 7 a.m. after that because there was nothing else at 7 a.m. the top of the hour with breaking news that I liked so I was waiting for news didn't see anything I liked so no trades 7:30 same thing nothing with breaking news no trades coming up to 8:00 a.m. all of a emkr starts hitting my scanner emkr I pull it up I pull up the level I pull up the chart while the chart's loading I'm pulling up the level two and what I see on it in instantly is that it's spiking up and I'm like whoa hello this is this is a pretty serious move that we've got right now so let me Zoom this in uh so this basically as you can see in 10 seconds shoots up from a120 doll2 it goes up to two bucks then it goes up to$ 250 to $3 hits 350 dips down right here I bought this dip right there with 5,000 shares it pops back up to 350 I'm holding for the break of 350 and then I see someone post hey the news is that it's a buyout and so I said oh all right I'm getting out so typically when we get a headline of a buyout this is a buyout offer it's not a confirmed buyout but it's a buyout offer sores after Mobic Labs offers to buy the company at $380 per share typically when you have a buyout offer or and certainly a confirmed buyout but a buyout offer usually the stock goes pretty much to that level a buyout that's confirmed the stock goes to that level And Trades exactly at that price or within you know a percent or two of that price sometimes it trades at a little bit of a discount because if you like let's say let's say for instance you had a stock that you know let's just say the buyout is $5 a share just for instance and you know so it's trading at 350 and immediately spikes up to let's say you know 475 some people be like why wait a second why is it not trading exactly at five why is it trading at 475 well you could buy it at 475 you know you could buy 10,000 shares this at$ 475 and just wait and when the buyout goes through you'll get you'll your stock will be bought out at $5 which means you'll have $2,500 per share or or total profit 25 cents $2,500 but you've got to wait you've got to wait till the till the buyout gets confirmed or till the buyout finally goes through and then you have to wait to receive the settlement so it takes some time and during that time you have some risk and the risk is that well what if some company some you know someone sues someone sues the board of directors and says this buyout deal is unfair it's not fair to shareholders what if shareholders sue you know what if what if the Department of Justice or you know some regulator comes in and says nah we can't we can't approve this merger this will create a monopoly now that's probably not going to happen on a small cap stock but let's just say if it does then all of a sudden what's going to happen Boom the price is probably going to go back more or less to where it was before the buyout so to make $2500 on 10,000 shares while risking you know potentially well what could this be a loss back down $220,000 the risk to reward ratio not really great combined with the fact that the longer you're holding the stock the more you're just exposing yourself to your cash is tied up you know it's a risk so for that reason they often do trade a little bit of a discount to the actual buyout price and some people take that risk and say yeah I'm I'm fine with it it works nine out of 10 times a buyout goes through I get my money and then the one time it drops maybe they have a tight stop with a stop order and it takes them out so however you do it is fine but it's not surprising that the stock may not trade exactly at the buyout but this was surprising to me that when it pulled pulled back so I got out I was like all right well it's a buyout so it's not going to go any further if the buy out's at 380 up here at 350 that's probably it so I ended up getting out at about 340 and then drops down to three and then drops down 275 260 I said that's weird what you know it's kind of odd you know typically I would expect this to trade a little bit closer to that level I mean this the only question is is this a fake offer is this not a real offer is there any reason the company wouldn't accept this offer um you know I mean generally when you have a good buyout offer they they do get accepted now this company might say no we're not well look we're not going to sell you know 380 I mean that's for shareholders that only gets back to where we were in February right which well you know if the company was better it wouldn't have dropped this much and look some people would be happy to get out at four times the current trading price this is what the market currently values a stock at someone's giving you an offer for four times that take the offer right but nonetheless for whatever reason uh the prices started to come back down so I find it surprising a little bit confusing we'll be interesting to see what happens so at this point now this is presented to the board of directors who then presented to shareholders and well they could you know they they are working on behalf of shareholders so they could approve it and then shareholder I don't know it depends I guess on the bylaws and whether or not shareholders are required to vote on this buyout but I think the board directors is probably authorized to approve it and and then if shareholders dispute that could result in litigation but but probably you know it's if it's a good offer you'd think they would accept it so anyways I don't know what's going to happen but this was kind of confusing nonetheless the trade was $1,000 of profit and I don't have any problem with the trade because I bought that dip off of three pulls back to three stop at three squeezing back up and in those first moments that actually highlights the fact that when we first get that momentum when these first start squeezing you know the actual catalyst isn't as important as the fact that you've got rate of change now eventually long term that Catalyst does matter by the way just watching xhg which is my biggest winner today it's currently just uh hit a high of 196% and I saw 230,000 share seller come out on the level two there um so this one's interesting because there's been a lot of selling it's a Chinese stock up on no news all right so you know again 67,000 share seller right there this thing literally was at a dollar a share this morning goes up to A110 15 drops or $140 drops all the way back to a dollar then rips through $150 goes up to $1.75 pulls back goes up to two let's start talking about it this is the one that I made the most money on and as it turns out I left some money on the table but I'm walking away here in the green and I'm pretty happy with that because it you know locks up um the month of September so all right so let's look at xhg xhg first hits the scanner this morning when it pops up right here to a140 and when it popped up right here to a140 the initial response was oh it's a Chinese stock with no news except for Chinese stimulus stuff like that so I don't know ends up dropping does a full round trip goes from a140 all the way back down to a15 all right then it bounces bounces off this level and squeezes back up to a140 and goes up to a high of a$1 52 as it pulls back right here here I got in uh right here it was actually on this pullback right here I bought that pullback right there I I probably should have bought this one I was just a little too slow I was like I don't know if it's going to work it's kind of cheap is it going to work but it ends up breaking this level I jumped in right there that was my first entry in at about $165 goes up to $1.75 goes up to A180 I take my profit off the table then it pulls back right here I bought this dip at a about a166 right here it pops back up to 75 I get out at like 71 it's like 4 cents a share of profit comes back down I get back in at 60 double bottom and on that one it kind of just bounced like two cents a share it was a small bounce it goes up to 75 and then it dumps down to 55 kind of a false breakout and the thing on this one was I was really hoping that this was going to create our first one minute candle to make a new high cuz on the one minute we have green candles remember every Six 10sec Candles forms a one minute candle so so green candles and then we had a red candle and then this was red but with a bottoming tail kind of like that so I was looking for this next candle right here to break and squeeze back to $185 $1.90 that's what I wanted to see happen instead it ends up dropping lower so it goes lower goes sideways and then right here I get back in and look at this candle holy smokes this thing goes to $1.90 it then dumps to $155 I'm holding my full position it comes back up I got out $180 I was like whoa that was close I was not expecting that kind of whip that's a 40 C whip on a $2 stock it then comes back up and I nervously with small size got back in at 190 for the Breakthrough two it goes to 205 it pulls back I then get back in at 205 right here it drops back down I then get back in the third attempt or second attempt over 205 it goes to 210 215 220 and there it pops up to 230 best exit the high was 228 best exit was probably 225 and then it starts pulling back a little bit so I I traded it quite a bit I even traded it through this area looking for that second break through the high and I kind of uh you know I kind of got a little burnt out on it because I kept getting in getting out and I just felt like I was pushing my luck now I traded it through this first leg of the move going up right here and then right about here we had the Mac D crossover what's my drawing tool my drawing tool is not working whatever so right about here we have the macd crossover macd crosses over and in spite of that I did take this trade with smaller size and the reason I took this trade here with smaller size was because I thought even though the macd was crossing over it was pretty strong it was pretty obvious I should give it a a chance so small siiz trade but it didn't work it wasn't a significant loser but it was just a small trade and then at the open pops drops no trades no trades sells off no trades and then all of a sudden 10 a.m. rips through and halts up opens dips I was like is it going to dip and rip and it kind of hesitated for a second and then it rips up to 5660 pulls back up to 65 pulls back no trades in it here watching it rejection and then ripping back up and now rejecting again so you know what I I'm not up that much on it all things considered but I am green I really shouldn't complain at all because green is is always good and I I followed my rules of being aggressive on more or less the front side of the move and one of the things and you know Duo is just continuing to push higher and this is a stock by the way that um has a a history of making some big moves but has also done a bunch of reverse splits and you know could almost say is I don't know if too many people would connect to this these two lines but um I mean maybe you'll have ascending resistance in there you don't usually see that on these charts usually it's descending but um anyway so you know I I think for me the interesting thing that we noticed in my metrics from last week was that last week I took about 76 trades accuracy was 82% and profit loss ratio I want to say it was close to it was 3:1 it was more than 3: one that was last week the week before um so the week before I took about 208 trades I had something like was like 58% accuracy a one: one profit loss ratio and uh even though I traded a lot more I made less money so this was about I think it was $15,000 average profit over the three weeks prior and this was um I can't remember what I did last week it was was it 30,000 it was 30,000 I think so what's interesting here is more profit on fewer trades but with much higher accuracy and a much better profit to loss ratio so today you know I I did take a few more trades I I have a bit of confidence here coming in Monday morning after a good week last week and I thought all right you know look first trade of the day 1,600 bucks that's great let's see what I can do and you know traded xhg pretty aggressively I I did the best I could on it but I wasn't able to do anything crazy you know I didn't double my daily goal I didn't it ends up that today is just more or less a base hit day and I think that today probably we would see that my um accuracy is a little lower because of some of these quick entries and exits on xhg so I think my accuracy is a little lower today my profit loss ratio might also be a little lower today because I really didn't have big Winners I mean I had two $1,00 winners and then I guess my Biggest Loser was probably like $500 um on xhg so I guess it's probably a decent profit loss ratio but I also had a couple small winners like grr those are those were one small winner one small loser it's just like a $60 winner then a $40 loser um em KR that's a decent winner but I also had some really small winners on xhg so this is the stock I traded the most by far and considering how much I traded it I don't feel like I really have a lot to show for it and it wouldn't be hard with one trade of 15,000 shares on a 20 cent whip to give back everything I made on it and that that's kind of why I'm like you know I don't want to overstay my welcome so green is good I'm grateful to be in the position I'm at um and you know now look we've got the opportunity to start a brand new month so for October what's the game plan well my plan for the month ahead I'm expecting that for October we're going to continue to see volatility at the open well sorry pre-market based exactly on when breaking news comes out so breaking news that's going to Tri trigger momentum and then at the open it's going to be continuation on the stocks that have been the strongest from pre-market with the exception of maybe some surprise uh stocks have breaking news at the open or stocks that just kind of all of a sudden get some momentum at the open but weren't strong pre-market which happened on prtg or maybe it was glmd last month or well early September but it's not as common so yeah so the game plan for the month ahead is going to continue to be aggressive trading when breaking news comes out and for those of you guys that want to watch over my shoulder through the month of October make sure you check out uh the two-e trial the two-e pro preview trial gives you a experience of what it's like to be a warrior Pro member uh here at Warrior trading so check that out link will be pinned at the top of the comments and in the description let's get October off to a great start I'm looking forward to seeing you guys bright and early tomorrow morning I'll be tuning in around 6:45 7: a.m. and hopefully we have some good uh stocks on the scanners all right that's it for me reminder as always trading is risky my results aren't typical so manage your risk take it slow and let's see you guys back here first thing tomorrow morning