0 Trades Recap for 10/29/2009 Posted by shawn | at 1:55 PM

OTC:GETA had some bad news this morning and saw a whopping drop from 0.60 to 0.17 and started basing around 0.10ish.  The drop is too big and without a doubt I knew it was going to rebound.  Bought at 0.12 and held for a crazy ride.  Sold at 0.25 at the first red candle.  After that I was done for the day :)

OTC:TNUS saw unusal heavy volume and bought at the open to see what it does.  No disappointment here.  Bought 0.64 and sold 0.79 when I saw volume dying down.

0 Trading is simple right? Posted by shawn | at 2:03 PM

Trading can be simple if you make it so.  People traded long before there were computers and indicators. So why do you have so many computers and indicators? Read some excellent words of wisdom below:

“Unless you experience the unpleasant symptoms of being wrong, your brain will never revise its models. Before your neurons can succeed, they must repeatedly fail. There are no shortcuts for this painstaking process.”

Pg 54 - HOW WE DECIDE

“Look, for example, at this elegant little experiment. A rat was put in a T-shaped maze with a few morsels of food placed on either the far right or left side of the enclosure. The placement of the food is randomly determined, but the dice is rigged: over the long run, the food was placed on the left side sixty per cent of the time. How did the rat respond? It quickly realized that the left side was more rewarding. As a result, it always went to the left, which resulted in a sixty percent success rate. The rat didn't strive for perfection. It didn't search for a Unified Theory of the T-shaped maze, or try to decipher the disorder. Instead, it accepted the inherent uncertainty of the reward and learned to settle for the best possible alternative.

The experiment was then repeated with Yale undergraduates. Unlike the rat, their swollen brains stubbornly searched for the elusive pattern that determined the placement of the reward. They made predictions and then tried to learn from their prediction errors. The problem was that there was nothing to predict: the randomness was real. Because the students refused to settle for a 60 percent success rate, they ended up with a 52 percent success rate. Although most of the students were convinced they were making progress towards identifying the underlying algorithm, they were actually being outsmarted by a rat.”

Pg 64 - HOW WE DECIDE

“Think about the stock market, which is a classic example of a “random walk,” since the past movement of any particular stock cannot be used to predict its future movement. The inherent randomness of the market was first proposed by the economist Eugene Fama, in the early 1960's. Fama looked at decades of stock market data in order to prove that no amount of knowledge or rational analysis could help you figure out what would happen next. All of the esoteric tools used by investors to make sense of the market were pure nonsense. Wall Street was like a slot machine.”

Pg 67 - HOW WE DECIDE

TRADING IS SIMPLE:

* Price either goes up or down.
* No one knows what will happen next.
* Keep losses small and let winners run.
* POSITION SIZE = RISK / STOP LOSS
* The reason you entered has no bearing on the outcome of your trade.
* You can control the size of your loss (skill) but you can't control the size of your win (luck).
* You need to know when to pick up your chips and cash them in.

Don't let the rat beat you.

“Since your mind is your most valuable asset and your most valuable lever, you need to be careful what you put in it. Sometimes it is even more difficult to get rid of thoughts and ideas that are already in your mind than it is to learn something new” - Pg 119 WHY WE WANT YOU TO BE RICH

F - Follow
O - One
C - Course
U - Until
S - Successful

- Pg 110 WHY WE WANT YOU TO BE RICH

If the rat is beating you, you are the reason why.

Here are some reading material:

• Fooled by Randomness: The Hidden Role of Chance in the Markets and in Life by Nassim Nicholas Taleb 
• The Black Swan: The Impact of the Highly Improbable by Nassim Nicholas Taleb
• How We Decide by Jonah Lehrer
• Trading in the Zone: Master the Market with Confidence, Discipline and a Winning Attitude by Mark Douglas
• The Disciplined Trader: Developing Winning Attitudes by Mark Douglas
• Why Smart People Make Big Money Mistakes And How To Correct Them: Lessons From The New Science Of Behavioral Economics by Gary Belsky & Thomas Gilovich

0 Trades Recap for 10/28/2009 Posted by shawn | at 1:30 PM

Three successful trades all executed during the open.  First up,

OTC:SUNV was alerted by investorsunderground chat.  Saw lot of volume and bought at 0.1475 sold 0.16 because it looked like it was topping.  I always sell quickly and it has faired well so far.

AMEX:TCX was alerted by pennystock prophet(PSP).  Bought at 0.53 and sold at 0.61 as soon as I saw volume was dying down and getting toppy.

OTC:LFBG was tipped off from twitter of having possible news.  Bought at 0.0223 and sold 0.03 20k shares.  Lots of volume came in after I bought and pushed it higher.  It looks like I sold at the top on this one.

0 Trades Recap for 10/26/2009 Posted by shawn | at 6:25 PM

Two trade alerts and both were pump and dumps.  First one was alerted by stockpreacher, NASDAQ:OOIL.  Caught it at the open and quick scalp of 6 cents, not much but with the stockpreacher trades I'm always trading like a scared castrated choir boy as Tim says HA!

Second play was NASDAQ:LBIX which was alerted by PSP ( Penny stock prophet), caught this early at 0.62 and sold 0.73 when it started to show weakness.  Looking at the chart looks like I caught the top..phew, lucky!

0 Trades Recap for 10/23/2009 Posted by shawn | at 9:13 PM

Just two trades today:

NYSE:GBE was a pre-leader long and bought few to see what it does. The action didn't happen till noon when there was news (Grubb & Ellis Company Announces $90 Million Preferred Equity Transaction) I'm holding this position over the weekend.

NASDAQ:ICOP was a penny stock prophet pick.  The alert came at 9:30 and grabbed shares at 0.72 and sold mid-morning at 0.85.

0 Great Profits Found AfterHours Posted by shawn | at 6:05 PM

Instead of shutting off your computer after markets close, stick around as there is a lot of money to be made, especially the earnings play. Great profits found in after hours, plays such as $EBAY $LTM $UTA $SPWRA $YAHO.  Check out the charts below that explain great bounce plays, courtesy of Stockguy22

Nice bounce off the fib levels:

0 Three Stock Brokerages I use and Why Posted by shawn | at 5:11 PM

I have accounts with all three stock brokerages (Interactive Brokers, ThinkorSwim and Questrade) I highly recommend all three and feel free to contact me for a referral credit.  I recommend having multiple brokerage accounts because some will have shares to short while others wouldn't.

Interactive Brokers Canada:

• Ridiculously crazy low trading commissions(1$/100 Shares however anything under 1 dollar they use a different pricing structure) Not recommended for trading pennystocks
• Minimum to open an account is 10k but you can also open one with 5k using my workaround
• Direct Access platform which means the orders get executed in fraction of a second
• Platform is awesome. I use Booktrader for scalping.
• If you are looking to short, more likely Interactive Brokers will have the shares to short than others
• Low Margin Rates
• Super low exchange rates (1 basis point = 0.0001 (0.01%) with a min. commission of $2.50USD)
• Min commissions are $10USD/mo. If you don’t trade at least this amount per month, they will take the difference from your account.
• EFT deposits are FREE, along with the first monthly withdrawal. Fees apply after first withdrawal(Deposits take 5 days to get approved (through EFT)
• Offer only non-registered accounts, that means no RRSP, TFSA, 401k etc.
• Follows the SEC Pattern day trader rule ( 25k min to required to make more than 4 day trades in 5 business days)

ThinkorSwim (TOS) Canada:

• Fair trading commisions( $0.015/share ($5 min) or$9.95 / trade (5000 shares max), however if you trade frequently you can negotiate a better deal. Currently I pay 7$ flat for unlimited shares for all exchanges(OTCBB, Pinksheets) including pre-market and after-hours trading. Highly recommend for trading pennystocks.
• Platform is one of the best I have ever used
• Minimum to open account $2500 USD
• Cannot hold Canadian currency within a Think or Swim Account.
• Only offer margin accounts not registered accounts ( i.e. RRSP, TFSA)
• They do not follow the SEC Pattern day trader rule ( 25k min to required to make more than 4 day trades in 5 business days)

Questrade:

• $4.95 -9.95 per trade ( add 5$ on top if you are trading US Stocks in a registered account i.e. RRSP, TFSA etc.)
• Basic free platform is terrible but if you are cheap you will work around it.
• Direct Access platform which means the orders get executed in fraction of a second
• Minimum to open account is $1000
• EFT Deposits/Transfers are FREE!
• Offer margin and registered accounts ( RRSP, TFSA etc. )
• You need to remember three passwords - MyQuestrade (for adding, withdrawing, exchanging funds, requesting help etc.), WebTrader (the trading platform) and Penson Financial (for accessing account history etc.)
• They do not follow the SEC Pattern day trader rule ( 25k min to required to make more than 4 day trades in 5 business days)