$NEXI +100% at the open! transcript

all right well here we are it is Tuesday morning and finishing again in the green consistency is pretty solid so far this month but in my first trades I went red on the day and I was able to recoup that loss and finish green but not by a lot and I said you know what I think this is the moment where this is the right spot to walk away sometimes it's easy to look back and be like I should have walked away right there and today was one of those days where I said you know I I feel like I'm going to look back and say I should have walked away right here so I'm walking away now it's 10:30 I finished the the morning trading session at least the early morning session from 7:00 a.m. till 10: 10:30 and the fact is I would give today a rating again of like a two the thing is we had a couple of stocks that made big moves but they did it on super light volume which made it probably nearly impossible to make serious money on the move up because there wasn't enough liquidity to get in or out with big size and then they just kind of pulled back and just faded it just like the slow fade uh one of them ended up kind of going sideways in consolidation for a little while and I tried to take a trade in that range and that's where I lost $350 not a big deal I took a second trade on it made back like 200 bucks so I was down about $179 coming into the open and I sort of felt like you know yeah I'd give today a rating of a two down 179 this might be the place just to say hey like walk away here but it did end up taking one more trade so let's jump into the charts and screen share and I'll show you what I traded okay so I'm going to put my uh camera back up there you go so uh and you know it's winter because I'm wearing my Patagonia very trusty keeps me warm even when I'm sitting at my desk well you know it's cheaper than uh turning up the heat so and I'll just say for a moment there's a being hey I didn't get to be making this much money without making good financial decisions so being a little Frugal it's a it's a smart way to be with money because the fact is we know that a lot of the people that end up in debt credit card debt things like that they're living Way Beyond their means it's important to train yourself to live underneath your means and that's something that I've definitely um had trained and um built into my way of thinking since I was very young okay so uh so first we could just look at the overall Market S&P 500 S&P 500 uh nice nice big green day yesterday giving back some of it pre-market today and and so far just sort of holding about half a little over half of yesterday's gains but not bad so that's the big picture of the overall Market still strong nothing concerning there I sat down this morning and we're going to look actually at my um we're going to look at my top Gap scan so this is the scan of stocks as of 930 a.m. this morning and you'll see sntg was the leading gapper I didn't trade this you can see I'm up um 900 $69 all right so you know like I said it's not a big green day but green is good it's certainly better than red so I'm not going to complain all right so uh so that was the p&l I didn't trade sntg here was my problem with sntg sntg if you recall made a big move last week or maybe it was the week before it was the week before uh but in any case um very recently we had this really big move right here okay so the stock goes from like $2 all the way up to $10 a share this was impressive but it gave back the whole thing it tried to do like a little pop and that got slammed down too and then we had a couple more red days so when I saw it on the scans today initially and again you know my routine I kind of rolled over early and I saw let's see what time did this start popping up it was 6:15 so I saw sntg on the scan and I was like no no no no I don't care about this yes the price is fine yes the float is fine but the the relative volume well even that's not bad but unfortunately what I know about this is that it's on the backside of this big move here which means a lot of Traders are going to look at this well number one you're going to have traders who were in on that big day but because they're beginner Traders and they haven't learned how to manage their risk they didn't sell so they might have gotten in up here or up here or maybe they even got in down here but they didn't sell and it went lower and then it went even lower and they still didn't sell some of them will just throw out a sell order with their broker just be like sell the whole thing at $475 and so when you have a day where it gaps up you can run into those sell orders and they kind of create this upside resistance you're not as likely to have that on a stock like nexi which uh today made new highs relative to its daily chart right so this is you what you might have is the inverse you might have shorts who are like cover me here cover me here cover me here cover me here and that's when you can sometimes get these explosive moves but you know yeah you might have some profit taking but you're not going to have the bag holders it's the bag holders who take big size average down and then they're trying to get out on the offer gosh I've got a barking dog here all right so so that was sntg um so I I immediately was like I'm not interested in it but of course I pulled up the chart just to look at it a little bit more closely it did a nice sort of Po at 7: a.m. right here 7: a.m. is when a lot of retail Brokers come online and Traders jumped into it it went from 380 up to 480 so that was actually the cleanest move of the day I didn't really expect it false breakout right here you see that candle false break there sells off under vwap gets above it back below it back above it pull back and now it's doing a little pattern of like three candles up three candles down three candles up two candles down three candles up couple candles sideways and and then at the open predictably it crashed it sold off I just didn't think this was good now some people would say Ross if you were so confident that it wasn't going to be a good long why didn't you short it well so two things just because something isn't a good long doesn't by default make it the inverse it can be neither good for long or short that's very possible now in this case we look at the chart it's like oh that was a better short okay fair enough so let's say in this case this was a better short what I know about myself is that I really see the market better to the long side now by seeing the market to the long side you can certainly interpret oh this isn't a long this probably is a short and maybe I think that sometimes I do but I don't take the trades because I just know that that's not that's it's like that's not my go-to strategy it's not what I've gotten really good at what I've gotten really good at is trading with relatively small accounts and trading to the long side and so if I start to focus my time on trying to get better at shorting these stocks or something like that that's taking away my attention from the next trade that I could be buying to the long side and then secondly because my primary trading account is a retirement account I can't trade to the short side you cannot short stocks in a retirement account so the nice thing for me is that this profit there's no tax no tax it's taxfree so I have over $6 million of profit just in this account alone that is taxfree if I had made all that profit to the short side if you made 6 million in one year trading to the short side you you'd Ow like $3 million in tax depending on your state up to $3 million in tax so in a sense you could say that I make twice what someone would make to the short side just because I trade in a retirement account and because they trade in the short side they're they're losing it to tax so in any case I focus on trading the long side that's that's my wheelhouse and that's also the same reason I don't focus on trading you know Nvidia or trading Apple or Tesla are these stocks volatile do they move around sure sure they do but what I got really good at was trading in small accounts and when you're trading in a small account you're not going to be trading this kind of stuff when you're in a small account you're trading stocks like nexi you're trading stocks that can go up 100% in one day there's a limit to scalability on these types of stocks but these are the types of stocks you're going to trade and yes I did trade in the small account today I'll have an upload uh later this week for um episode two of the small count challenge to keep you guys up updated all right so oh so anyways nice to see nexi coming back up here but now it sort of has this little bit of a devil look to it um right so you've got these you know kind of little ears almost like a little fox this is it's going to be tricky and one of the issues is that you've got the high volume red candles right there so on nexi anyway so I explained as sntg I expected it to fade at the open I wasn't sure but I sort of thought it might I didn't take any trades on it no trades on uh sntg btbd we'll look at this one first btbd uh this one is one of the ones that made a big move early pre-market but it did it on pretty light volume so it squeezes up from $3 to like seven bucks it sort of gets jammed up and then comes all the way back down this was the period where it was sideways and that's where I lost my $179 I took two trades in this little range lost on the first one 350 got back in the second one made some money but net negative still on the stock and then once it broke down below about 425 it just faded uh you know it's also worth noting that one of the risks of course with shorting is that you do have infinite loss potential and we had that stock the other week that you know halted down a couple times then halted back up and resumed at $500 a share and you'd think like that's got to be like you know they wouldn't seriously let you lose like $10 million on that trade I assure you they would they would let you lose that much they would take that money right out of your pocket so you know as much of a anomaly Black Swan that that might be it is not worth it to me so this one you know I thought when I looked at the daily chart I was like okay so it had basically zero volume yesterday um and then out of nowhere you know makes a squeeze up it was Blue Sky alltime Highs it had potential but unfortunately I think what happened on this one was it just moved so fast um and maybe it's because it was early I don't know it say 745 is not super early but it moves so fast on such light volume I didn't even see it I didn't I you know this stock had such light volume I didn't even see it until it was back here so I think a lot of people just missed it you know and when and unfortunately when you have that kind of candle it's just it's like I can't really trust that so you know trading it in this area to see okay is it going to break back up through and you know grind up maybe maybe but no it couldn't so and then if we look at the five minute chart you see the candle is uh very unappealing when you're zoomed in on it so it's this huge shooting star so that's what we were sort of even when I was trading in here I was like man I just don't know I don't know if we can recoup that so we and we couldn't uh that was that all right so anyways no big deal um so that was btbd so both of these were big gappers but neither of them uh to me were worth trading mcrb floats too high s s y um this one it's a little too cheap for me uh float's okay but a little too cheap go look at the chart it had made a move early and then sold off as well so we didn't really get a good follow through on that one looks like the move started after hours jnpr down 20% I don't know nothing sorry up 20% but moving down the scan right now price is too high floats too high nkk I saw this on the scans um popped up to 270 drops all the way back down here so pretty nasty rejection and there were a few others anyways nothing that exciting and then um cutr this one ended up making a move at the open bit of a grinder a little more thickly traded but it moved nicely and nexi is up 85% so this one you know I we traded it I think it was last week yeah this day here um had a couple days recently where it's popped up and sold off but gave some nice action high volume it sells off and then starts grinding back up this morning it comes back up and I kind of am a little annoyed about it um because you know I had sort of the right idea but I got a little timid on it so it ends up popping up here to a high of 975 it then pulls back right here and uh it then halts up once twice and then dip and rip up to a almost a third Halt and then comes back down now it's grinding back up but now it almost looks a little like sntg it's kind of this this was the high it's grinding back up volume's coming back in but we do have a highest volume being red highest candle highest volume candle red so you know it's kind of a light volume squeeze it had a nice daily chart the stock has a particularly low float and you know I think all of that combined to give it um the ability to put in this nice this nice move but is it going to give us more I don't think it I don't really know I don't think so it's holding up better than I thought though it is above vwap so the longer it stays above vwap the better that looks maybe for a curl later in the day but the fact is I'm not in a position where I can take the risk so the window is closed for me I got to knock myself out for today and you know I can come back and try again tomorrow we do have a Chinese IPO happening today Roma you know there's a part of me that's like Should I stick around for it um it's I think it's a 3 million share IPO was priced between like $ four and5 it's showing a $9 price right now the thing is you know these Chinese IPOs can be so sketchy a lot of them I mean we've had some big moves on them but day one of the IPO can be really wild uh and I actually noticed that the there are shares available to borrow on this which is kind of rare for day one IPO but um um they are available so maybe it's best just to steer clear this one and you know hey if it makes a huge move that's awesome but at the end of the day I've got to manage my risk I've got to preserve Capital I'm locking up a small green day it's not huge but the average is obviously going to be better if I have fewer red days you know the fewer negative red days I have negative days the better my daily average is going to be so I want to boost up that daily average and part of me thinks that I can do it by sticking around a little less trading aggressively during my window and then just at that certain point saying you know what this is the point where I'm going to walk and so that's what I'm doing today and it's going to be very easy for me because I'm just going to close this all down and I'm not going to look back I don't have to look at charts for the rest of the day so I'm going to shut that down there close my broker account close this and now whatever happens for the rest of the day it's out of sight out of in mind I won't even know about till tomorrow so that's a little strategy that you can use just to help yourself disconnect shut it down turn it off walk away and now you're actually booking your profits they're done they're locked and you'll come back and try again tomorrow so I'm not going to have fomo whatever happens for the rest of the day doesn't matter because I have other things that I want to do I will come back tomorrow and I'll make the most of tomorrow in my window where I usually trade the best and you know we could get in a cycle where we're seeing more moves in the afternoon than we are in the morning you know always changes but my window has been consistent for such a long time I'm going to keep focusing on trading in that 7:00 a.m. to 11: a.m. window and making the most I can on days where it is super super hot I'll keep trading until it gets cool but it did cool off today and I didn't make a ton so anyways that's it for me reminder as always trading is risky my results aren't typical and there's no guarantee you'll find success whether you trade on your own or you learn from me so manage your risk and please practice in a simulator before you put real money on the line all right I'll see you guys back here for the cap bright and early tomorrow