Chinese Stock Up 200% and Healthcare Stock Up 167% in 3hrs transcript

What's up everyone? It's Tuesday morning and we've got a penny stock squeezing up as we speak, up over 200% and continuing to move higher. This is a Chinese stock that came out with news. So, it's not a no news Chinese stock. It does have a headline and it promptly began squeezing. By the opening bell, over 120 million shares of volume have traded. Wow, that is a ton of volume. Which means with that amount of liquidity, it would have been easy to buy 100, 200, 300,000 share positions.

And the problem with that is with a 100,000 share position, every penny is a,000 bucks. Which means if you're at a commission-free broker, there's no doubt that people are buying and selling 100,000 shares just to make one penny of profit. And that means as soon as it pops up a penny, there's someone willing to sell. And the result is the stock has become very thickly traded. But there's another problem with it. If we jump onto the whiteboard, the problem is that yesterday the stock closed below 75 cents a share.

Which means during regular hours, the halt bands are every 15. Now, stocks that closed the prior day between 75 and $3 a share have halt bands that are 20%. Stocks above $3 a share, halt band is 10%. So let's do an example. So let's say we have a stock that's $2 a share. It's up over 100%. Yesterday closed below 75 cents a share. What's the halt band up? Is 215. If it goes to 215 in less than 5 minutes, it will halt up.

What about a stock that's also $2 a share, but yesterday was closed above 75 cents a share. Okay, halt bands 20%. That means it's going to go up to $2.40 before it halts. Or you have a stock that yesterday was $3 dropped back down is at $2 and the halt band is 220 10%. This is a very funny system because it's based on the prior day close. So you could have three stocks that are the exact same price but have different halt bands.

Now, the good news, if you're trading using the Warrior Trading Simulator or if you're using some of the more sophisticated brokers, you can actually see the halt bands. So, let's pull up a stock, GRML, for instance. Oh, this one's halted. Just luck of the draw. We'll pull up Decoy. So, Decoy, let's see. Oops. Let's pull this up. So, Decoy right now has a halt band. Let's just pull this down a little bit at $649. So that's the halt band 649 up and 443 down.

So if we look at uh Decoy and that's the stock that I made the most money on. You could see it's rallying up as we speak up 130%. This is a US company. It's a biotech stock. Um putting in a nice move here at the open. The prior day close as you can see was between 75 cents and $3 a share which means the halt bands are 20%. But that's 20% above the average price over the last 5 minutes because the price is obviously fluctuating.

That means the halt bands also fluctuate. Now the halt band has moved up to 664. But I can see where it's going to halt. Now you have access to that same data in the Warrior Trading Sim for those of you guys who are using it. So we're going to break down my trades from today. I'm going to walk you through the watch list that I was looking at essentially as I was sitting down this morning. Here's Decoy on uh the simulator and you can see the halt levels uh right down there.

You just have to adjust your charts a little bit. So I'll cancel that out. So now it's gone up to 674 in the Warrior Trading Sim. Okay. So this morning when I first sat down, we had um we had some lower price stocks were moving up and we also still had GRML, the Greenland mining stock from yesterday. This stock is on now day three of continuation. The move began on Friday after hours, continued into Monday, and has continued into Tuesday.

So, generally speaking, what I find is that the volume declines as the days go on. So, if we look at the volume profile on this stock, this was from the after hours move on Friday, which was light volume, but that's not surprising because it's after hours on a Friday. Volume really increased yesterday and then decreased as the day went on. And look at today. Today, the volume is significantly lower. And yet the price is going higher.

So we have a divergence. Volume declining price increasing. Going from $13 a share to nearly $16 is impressive. We love to see that. But we also have to recognize that this at this price range has bigger spreads and less liquidity than it had before. Which means if you were able to jump in and out of this with 20,000 shares yesterday with very little slippage, you wouldn't be able to do the same thing today. In fact, if you tried to trade, you know, 40, 50,000 shares, you'd probably get a lot of slippage on the stock.

A dollar a share potentially of slippage depending on, you know, how much the market makers wanted to abuse your order if it was a marketable order. Now, this is approaching the daily 200 moving average. As you can see up there, if we type in GRML, we're showing a 587 resumption. So, it halted at 587 and right now is showing a resumption quote of exactly the same price. Often times when you halt up, we expect the stock to gap higher and continue.

So when it shows the exact same resumption price, what that tells us is there's actually a seller at 5.87 right now. There's not enough buyers that are able to move the price up even a penny higher. And so that can be a warning sign of a potential reversal on the resumption and then the risk of even a swing to the downside and a halt down which would be very discouraging. But I think we have to acknowledge that GRML has gone from $2 a share all the way up here now up nearly 500% but in three days.

So it's continuation over the course of several days having something like LHSW which peaked um this morning. This is actually pulling back a little bit here. This one went from a low um down there all the way up about 260% as it peaked at $158. That put in a decent move. So, I saw um so the first stock I was looking at this morning was GRML. Was aware of it, but thought day three a continuation probably going to be too risky.

You can see the resumption there and see how it's dropping back down. Halt down levels at 418. Halt up is now 1733. Oh, and now we're down to the halt halt down level which is at 418. So, you can see that volatility, but that was a warning sign. Now, if you appreciate those kind of observations, what I just did is I took 25 years of intuition that I built up in my years in the market and I was able to convert what I was seeing there as a sign into layman's terms that you could understand.

As a beginner, it's very hard to pick up on those subtle cues, which means the more time you have in the market, the more edge and advantage you will have as a trader. I like to share that with you as members of warrior trading. Now, right now I have John, my first student who ever made a million dollars, earned him his million-dollar badge. He's currently streaming and providing market commentary and because he trades the same strategy as me.

There's no doubt that he already communicated what I just shared with you, which was the risk of the halt down because of the flat resumption. So, make sure you guys check out the twoeek trial if you want to see what it's like to be part of our community. And during that trial, you not only get to listen to the broadcast that I put out, John puts out our mentor sessions, you also get to use the same software that I'm using every single day.

All right. So, with that, uh, GRML, I said, "Nah, I'm interested in it, but I just don't know if I could trust it." So, then the next stock that pops up on the scanners this morning, if we scroll back here, was NCT. NCT was very interesting because it moved up very quickly. As you could see here, it went from $6 to 14 and then back down to six. It's a Hong Kong company. Fits the profile of a Chinese stock popping up.

It's got a recent reverse split. And when this first popped up, I thought it's obviously very risky. U but it is interesting nonetheless. It popped up, it pulled back. Micro pullback, it pushes higher. No trade. Micro pullback. I jumped in right there at $1193 and it pops up to a high of $14.50 a share. I was up two points, but I didn't sell and it flushes back down right here. I ended up selling for a loss. Then it dips down right here and I bought off support down here for a curl back up.

I sold and got out right here and I'm finishing up $700 on NCT. So, a little bit of a a loss and then a recovery at the open. 50% accuracy on NCT. Two trades. Average winners are just a teeny bit bigger than the average losers. And so, I'm green on the stock. So, that was the first trade and that the first two trades and those were done by 731. Then, moments later, what hits the scanner? Decoy. We see it hit the scanner right here at $7.32.

It's got 20 times relative volume, light total volume. I click on it. I see it's a US biotech company. I'm thinking, okay, interesting. It's got a headline including non-dilutive funding. That means they found a way a way to raise money without diluting shareholder value, and that's a good thing. I look at the daily chart. No recent big red candles. Now, we've got room up to the 200 moving average. I like that. The float's pretty low.

I like that as well. And so, I pull up the chart. I'm looking for an entry. And let's get it back zoomed in to the very beginning of the move right here. You can see how this immediately squeezed all the way up to a high of 490. squeezes up, dips down. I buy the dip, get the pop. We do another dip. I get another pop right here, locking up some profit. Smaller trades because the volume was a little bit lighter. Then it pulls back here and is below VWAP.

So now I'm not sure if we're going to get really any more action. It comes all the way back down to here. But what I observed on the one minute chart was the beginning of a head and shoulders formation. The head and then the shoulder coming back up. I did not take that trade. I just wasn't sure it would work because it pulled back so much. Drew this ascending support line as you could see right here. It shows support right on this area.

Comes up to 518, pulls back. I take a trade right through here. It's going to be in a minute. Right up here. It doesn't quite work right. It comes up, it rejects, it drops back down, tries again, fails. This ascending support line, it broke and becomes resistance. Resistance here. And now it would still be resistance, but the price is far below it. As we curled up closer to the open, I just didn't trust taking any more trades on it.

So, my last trades were actually in this area here, hoping that we would pull away, but we just weren't able to. It got pretty thickly traded, which was unfortunate. Nonetheless, I was able to lock up just under $10,000 of profit on decoy, trading with relatively small position sizes, breaking the ice, getting in, getting green, getting out. As you can see right now, you're getting a little bit of a jack knife. the pop, the drop, the recovery, then does it go?

Maybe. Does it flush back down? This is very difficult to trade in here. In fact, we saw a lot of big sellers on decoy, which were definitely making me a little bit nervous. But the volume profile is solid. More more buying volume than selling volume. And so, at a certain point, will shorts give up? They seem to be pretty powerful right now as every time it pops, you get a topping tail and the drop back down. So, I gave up on decoy.

I said enough's enough. And then I switched over to LHSW. This put in uh a couple of really nice patterns right here. Nice pullback, nice pullback. I missed the first one. I traded the second one and that gave me $2,94.84. So, finishing the day at $13,542.73, I'd say, is pretty good. I'm leaving with money in my pocket. Now, I may be leaving a little money on the table by not taking any trades on decoy at the open or leaving GRML alone.

I think GRML, realistically, I would have lost money on that if I traded at the open. Decoy, you know, it's hard to say. Hindsight's 2020. You always look at them and say, I would have crushed it. And I'm telling you, I've traded moves like this and managed to be a loser. So, I'm going to be grateful to walk away with a little more profit in my account than I had 3 hours ago at the beginning of the day. This is consistency.

Coming in every day, getting green, and getting out. And if I'm red, respecting my max loss, and walking away before it becomes a bigger red day than it needs to be. I never want to lose more in one day than I can make in a good day. So, right now, this week, you know, green days are averaging 10,000 yesterday, 13,000 today. We look at the gains from last week, I was up 78,000. So, you know, this pretty solid week last week, 15,000 a day. uh you know, so at this point, if I'm averaging about 12 to $13,000 a day for the last 7 days, I just want to make sure I don't lose more than that on a red day.

I don't want to lose more than I can make on the next good day. That's that's kind of my my attitude because if I lose 5,000, 10,000, I can make it back in one day and it's water under the bridge. I don't have to be stressed out or frustrated about it. It doesn't really matter. Now, if I lose, you know, a million dollars, well, that's different because that's far more than I can make in one good day. So, now I have to think, gosh, I just lost a million bucks.

It's going to take me, you know, how many months of really focused, slow and steady trading to make that back. It could be done. I've had big draw downs before and I've made it back. It can be done, but it becomes a mental battle and one I'd rather not face if I can avoid it. So, staying calm, cool, collected, stepping up to the plate with bigger size when it is worthy, when a stock is worthy of it. LHSW, I took 60,000 shares.

Liquidity was great. Was able to jump in with that, jump out, no problem. It's got right now 163 million shares of volume. Decoy was smaller size and NCT was smaller size. Uh, and I think that that was appropriate. So, with that, I want to remind you guys to check out the twoe trial. Link is pinned at the top of the comments and in the description. And I'll remind you as always that my results are not 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 in a simulator before putting real money on the line. With that, I will see you guys bright and early streaming at 7 a.m.