Day Trading Watch List for Monday! transcript

What's up everyone? All right, well, it's a rainy day here in New England and a good time for me to sit down and record my watch list for Monday morning and a game plan for the week ahead. This is actually going to be our first full week for the month of September. The first week of September started on a Tuesday, so it was a 4-day week. We still had the last day of August, but that was a little funny. So, uh, kind of it was a slow start to September, those first four days because we were going into a holiday weekend, which was Labor Day weekend.

So then last week was a 4-day week and volume was light. There weren't a lot of good opportunities. So that was tricky. This will now be starting September 14th. Our first full week for the month of September. All right. So I need to play a little bit of catchup. I had a red day on Friday. Max loss red in both the small account and the big account. I I really I don't have anything to show for last week. It was kind of discouraging.

And I don't have much to show for the first week of September. kind of in the trenches here on a little bit of a lull in the market and I'll be excited when things start to open back up. Sometimes it feels like someone just turned off the switch like we are not seeing good catalyst and then because we don't have good catalyst we're not seeing big moves. So, you know, we sort of sit down each morning and it's like leading gainers are up 30 40%.

They're light volume. There's nothing really there. They're cheaper stocks and we're not seeing good volatility. And then all of a sudden you get a stock with a good catalyst that goes up three 400%. And you see the way they trade and the price action is so clean. You get a rally up and then you get a first pullback and a rally higher, another pullback, another leg up. It's clean price action. We are craving that as momentum traders.

And it's not just long bias traders, short sellers as well. When it's this slow, there's not volatility. And if there's not volatility, well, it's pretty hard to make money. So, we're definitely in the trenches right now. Um, you know, but as always, I show up every day and uh although I was disappointed to have a red day on Friday on TN um you know, showing up is important. My challenge that, you know, I kind of have always had as a trader is that I'm not as good at taking my foot off the gas when things start to slow down.

I wish I, you know, I always say I could have, would have, should have, you know, size down sooner, taking money out of my account, this and that. Um, I think I actually will drop down my account balance because I just I don't think that I need the buying power right now. And so it's an opportunity cost to leave all that money in my account when I could invest it and then have it working in the long-term direction and, you know, beginning to earn interest and then benefit from compound interest and everything else.

So, I only keep the extra funds in my small account or in my regular trading account when I feel like I could legitimately use that buying power because one day that I need the buying power where I'm able to make a hundred or $200,000 day trading more than makes up for the opportunity cost of not having that same money, you know, in the market at 10% a year or something like that, you know. But on the other hand, if you go weeks without using extra buying power, it does kind of make sense to put it somewhere where you can earn a little bit of a passive return on it.

So, I think I'm going to probably do that um this week. Now, TN was the stock I trade on Friday and uh I lost 44,000 on it in my Roth and I lost 3,000 on it in my small account. And that was on um this rejection candle right here. It ended up coming back up having another rejection right here. So we had rejection one, rejection two, rejection three. Then it sells off at the open. Then it rips into a halt up, does a dip and a rip into a second halt.

Then it opens and then halts down, flushes, then rallies back up to here, unwinds, and then boom, news comes out in the afternoon of a secondary offering. We shouldn't be surprised. We knew it was coming. I don't even know why I bothered trading this one on Friday. I don't know why I thought it would do anything other than this secondary offering. I I'm annoyed with myself. Um, and I guess this is a trade that I kind of took a little bit out of boredom and a little bit sort of out of a feeling of um I I guess like disappointment in myself that I hadn't had any good trades last week and so we were sort of running out of time.

And as I kind of saw the window closing, I was finally just like, you know what, screw it. I'm taking a trade on TN. And then I was like, well, I wish I hadn't done that. So, anyways, that was Friday. Um, we did have a couple other stocks that moved on Friday. If we go back uh to our high day momentum scanner here, obviously we had TN and then as uh the bell rang, we ended up getting a little bit of a move on FTFT. So, you know, FTFT I I sort of looked at it and I said, I really just don't think it's going to work that well.

It's a continuation setup. The problem with these types of continuation setups is that typically they have lower relative volume and although you can get a little bit of a push higher, it's usually not that impressive. And so this is what ended up happening. Uh we had this double top up here, it rallies back up. It can't even get all the way to that double top and that was the high of day and that was it. So I don't think I missed much by not trading that one.

Um then we had um F feim. This one hit the scanners was moving up a little bit. Um you could see this one obviously is um priced too high. So no trades on that of course. Then we had PCLA. This one uh slightly lighter volume rallied up right here and then sells off and goes red on the day. Just terrible. We had let's see SXTC. This one went up a little bit sort of rallying and then selling off and then coming back up.

Double top. Couldn't break that level. We've seen a lot of these double tops that don't break. SWRD, one of these stocks that halts up, opens higher, and there really wasn't much opportunity to trade this to the long side because it just went up so quickly and then came back down and that was it. Higher float on it as well at 89 million shares. Um, so then yeah, PCLA was back on the scan a little bit later in the day.

U SXTC was back on the scans. Let's see. These ones were the I'm looking at the column here for the percentage gain and most of these ones were smaller percentage gains. So, not as interesting. BDRX cheaper stock, but this one did get a squeeze uh later in the morning and into the afternoon, early afternoon, but ended up selling off a little bit as well and is on the cheaper side anyways for me. TN as I'd already mentioned.

FGL, this is one of those stocks that pops up, gives it all back. It's done that several times. It's a Malaysian listed security, not one that I trust. Uh, so not interested in that. You know, I suppose if it had a very clear news catalyst, but even then, it's hard to trust it. So, the bulk of the day we had um, you know, just sort of a few random stocks that were moving. None of them were that interesting. Uh, then we go into the closing bell.

After hours, you get a little pop of momentum on a couple different names. SCNI and I usually begin um my watch list for Monday morning by looking at the after hours top gainer scanner. So right here our after hours top gainers. So SCNI was the first one that started to pop up. Very low float right here as you could see. Israeli biotech stock. You know these ones haven't been doing that well as of late. So in any case popped up about 25% 30% then softened a little bit closing up 22%.

TJGC. This one pops up, sells off, and those types of moves are impossible to trust. It's a Hong Kong stock with no news. Just that big pop and the rejection. I'm not interested in trying to trade that. I I'm just leaving those alone. I'm waiting for something that pops up and actually holds for the next leg higher and then holds for the third leg higher or so on and so forth. So, that's what I'm waiting for. And we certainly didn't get it on TJGC.

Now, I have noticed um you know, we've had some stocks that have popped up um quickly, but that's not enough. It needs to be able to hold up. Now, CRBP is also um a biotech stock right here. 13.8 million share float. Pops, drops, then comes right back up, closes at 1044 at the highs. You know, it's hard to get excited about it. The percentage gain is 26%. It's not that substantial. And this is kind of the issue going into Monday is that although there were a few stocks that moved in the after hours session, none of them really moved enough to feel like, oh, this is a super obvious setup for Monday morning.

So, we've got um CR, sorry, CRBP, SNI, VSME. This one, it's a little cheaper. I don't know. Not that interested in it. It's just it's just not enough range for me. Um maybe with a commission free broker you could do better on something like that. But um yeah, so unfortunately we don't have anything from our after hours scan that are giving us um potential ideas for Monday morning. And then a continuation scanner SWVL.

This is a stock that as we know, you know, has made a big move over the last few sessions. But notice on the daily chart how we have a divergence, increasing price, declining volume. I don't usually like trading when you have that divergence because the liquidity is drying up. And although the price is going higher, it's usually quite difficult to get in and out and you get caught in a bad in a bad spot when suddenly someone who is holding from this day back here starts to dump their shares.

No trades on that. No interest in it. AEL. This one is 1.3 million share float. It's a stock that on the daily chart has had some high volume days back here. Uh if I hide the 200 moving average and then click auto, we'll be able to scale the chart a little bit better. So, you know, it had a time back here in May June where we got this big move and then this has all been on the backside and we haven't been able to really put in a new rally in earnest in spite of some higher volume days.

So, no interest in that one. Um, VIOT rallying up off the low a little bit, floats a bit higher. No interest there. TN already discussed it. DBGI, this one sort of similar to TN in a way, this sort of selloff on the daily and then a bounce, but unfortunately it's um it's kind of hard to trust it because um it keeps popping up and reversing. And that's what we've seen on the chart is that yes, we get a pop um but then it gives it all back, right? pop gives it back.

So, you know, why why would it work on Monday? You know, again, if it had a really good catalyst, but I think that's a bit unlikely. So, right now, the biggest issue that we're having is that we're in between themes. We don't have a hot theme in the market that, you know, we can look at and say, "Oh, man. The next stock that comes out with XYZ headline, I'm all in on." We have markets where that's the case and usually that's a market where I can do pretty well because I know exactly what headline to look for, to scan for.

I've got the tools to do it. So then I just have to wait for that company to put out that headline and boom, I jump in, get a couple great trades. Do that a few times a week and I'm doing really well. You know, that's where I'm, you know, potentially uh having, you know, my $20,000 daily average, $100,000 week, sometimes even higher. But right now, we don't have that clear catalyst. So the catalyst that we can depend on but the the frequency of them is a bit more sporadic is number one a stock with a really good a biotech stock with a really good catalyst.

So clinical trials that are really positive and not just like one or two people but a real clinical trial with a good pool of people and the results are positive that can be a big catalyst for a biotech stock. A private placement for a biotech stock can also be a pretty big catalyst because it means the company will not be likely to sell shares on the open market since they've done it through privately through an institutional investor.

So, and that means that institutional investor vetted the company enough to write them a big check. So, that's a big vote of confidence. So, a big private placement, big biotech catalyst, those are two that can be really good. Then you know we always have the possibility of a no news move and they can surprise traders because it's like gez this doesn't make sense. So shorts keep adding but it keeps going higher and this is typically more common on foreign listed securities that are tightly held and so the float is controlled.

A lot of the shares outstanding even in the public float are held by insiders. Now you might think why would that be the case? Well think about it like this for a second. If you've got a company that, let's just say they issued um 10 million shares, well, and this is very similar to SpaceX. SpaceX has issued billions of shares, but the public market is only about 6% of all the shares that are outstanding. So, let's say you have a company that's issued 10 million shares and 95% of it are held by insiders that are part of the company.

So, CEO, CFO, COO, etc. Uh, and the remaining 5% of the shares, 500,000 are part of the public float. Well, because those insiders already have such a huge position in the company, what they could do if they wanted to control market price is they could decide to lock up the float and to start actually buying back shares that are on the market. Now, you have to file disclosures if you're going to do that. But with these foreign listed securities, those rules don't always seem to be followed.

So whether it's this the insiders individually or it's people they're affiliated with that they instruct to buy up the float, by buying up the float, they're now locking it up. There are now very few shares available to short. And so essentially, you have a stock that although the float might say X, actually trades like it's a much lower float. And in essence, if they put out a good news catalyst, they could start buying the stock up to start trying to push it higher.

And if all of a sudden it gets on the radar of all the other traders out there and you have a day where it does 150 million shares of volume or 434 million shares of volume, all they had to do was sort of light the match to get the fire started. And then once the fire started, the stock has a life of its own. And that gives them the liquidity if they choose to that they could sell. Now they might not. Some of these companies let their price go higher and higher and higher as we've seen with HKD, which was a foreign listed security that went all the way up to like $2,500 a share.

It was insane. It It was totally crazy. But it had a very small float. It was pretty much locked up. And so anyone who tried to short it just got run over very quickly. If you wanted to borrow more shares, well, tough luck. There weren't shares available. When you have a very limited float and that float is held by people who are sort of in the no with the company, they can opt out their shares of being used to lend out to other investors and traders.

So those shares will never be available to borrow. Any of us can do that. We can affirmatively opt out our shares from being borrowed, but most traders, you know, retail traders don't know how to do that. And so any position that we're holding, our broker lends out those shares to other people, which is bad because it essentially allows other traders to use our position to bet against our own position. It's not in our benefit.

Unless you get the, you know, the circumstance of a big short squeeze, but because those don't happen, you know, on quite a regular basis, it would be better to affirmatively opt out of the lending program of letting your shares be lent out. So depending on what broker you're in or you're using and if you do hold long-term positions, that's something you could look into is opting out so your shares can't be borrowed.

This was a big topic during the GameStop short squeeze because everyone said if you hold shares of GameStop, call your broker right now and tell them you do not authorize them to lend out your shares. Because if your shares are currently being lent out and you say, "I no longer allow it," then your shares have to be returned to you. And what would that force? It would force either the broker to find different shares that they could allow the short seller to sort of swap so they don't have to cover or if they can't find additional shares because everyone's opted their shares out the short has to cover that means buying and that means the price is squeezing higher.

So, you know, so again, not to get overly complicated, but you could have a scenario, and we've se certainly seen this before during a cold market where suddenly you have a foreign listed security with a really low float that squeezes and it makes no sense at all. Shorts get stubborn, but the thing just keeps going higher. And usually there's something going on behind the scenes that could help explain that, which we can speculate as to what it is exactly in that particular instance, but which we probably won't know with certainty.

So we've got that scenario or we've got the private placement catalyst or you know the great biotech news catalyst. Um and there could be other catalysts as well in the tech space but right now I would not be interested in stock uh on Monday morning for instance just in the energy sector. You know although we have had crude oil um you know moving higher in price United States oil fund uh dip down a little bit here. Um I I don't usually like trading energy stocks.

So energy catalysts, either fossil fuels or renewable energies, not interested in trying to trade those companies. Not interested in real estate investment trusts, REITs, they don't usually trade very well. Not interested typically in banks. They don't trade well. Not interested in utility companies. Those are essentially regulated monopolies. They don't really perform that well in stock price. So the type of stocks I tend to trade more would be would be biotech, pharmaceutical and um and different types of tech stocks which over the years have included AI, uh cryptocurrency, blockchain and you know that sort of thing.

So those are sort of the sectors that I'm either not interested or more interested in. And so when I first see something hit my scanners and I click on it, you know, I could pretty quickly tell, you know, where's where's it located? Okay, China. Is there any news? It's a no news stock. Okay, so it's a no news Chinese stock. What's the float? Says it's ridiculously low. So, is this going to be one of those ones that does something crazy?

I don't know, but that would be my sort of possible thought. Here's one, you know, US company. Okay, so what was the recent headline D? So, you've got um hosting a conference to discuss topline data from um clinical trial and potential D for obesity. So, okay. So, that's the headline that was driving it higher. So then you sort of get the flavor of that's that type of stock and that's what I'm doing a lot of is trying to understand you know location sector is there news and then what are the dynamics of the stock what's the float and do I need to go into the SEC filings to better understand um you know their current financial status so I can see oh you know this is a company that's carrying a lot of debt or this is a company that um has a lot of cash on their balance sheet they're actually in a good position they don't need to raise money so those are the decisions that you know or those are the things I'm checking as I'm working my way through making a decision of whether or not I'll take a trade on any particular stock.

So, tomorrow morning I'll be streaming starting at 7 a.m. and my eyes will be on this scan right here to see what is leading the way and if we continue to see 30 40% gainers, you know, and then maybe one outlier that's a cheaper stock, yeah, it's probably going to continue to be slow. Uh, but this is the way it is. The market is cyclical. We have hot cycles and cold cycles. So, if you're in the market trading every day that during this cold cycle, it's a good time to study and to learn.

Study the live archives from when it was hotter. So, the next time it heats up, you'll be able to better capitalize on those opportunities. That's the best way you can spend your time. So, I'll remind you guys as always, there's a link for the twoe trial pinned at the top of the comments. And trading is risky. My results aren't typical. And there's no guarantee you'll find success whether you trade with me or you learn on your own.

So, please manage your risk and always practice trading in a simulator before putting real money on the line. With that, I'll see you guys bright and early tomorrow morning streaming at 7