06/25 – TRXC nail ‘n bail

I started my day trading career with Tim Sykes and when I wanted  to learn more, I joined Investors Underground. The DVD’s that helped me the most were Tim Grittani’s Trading Tickers and Nate Michaud’s Tandem Trader.  Software that has helped me in my early years was: Trade Ideas software. Now I use FINVIZ ELITE.


 

Pre-market watchlist for today:  TRXC, AXON, GERN, TRVG, ENPH, CASI, ARQL, VSTM, VKTX

BACK FROM HOLIDAYS

Was out of the office for two weeks to rejuvenate. Well.. my S/o more then me I guess, but I tag along anyway to freshen up, chill a bit and come back smashing the markets. I am back now, full of energy!

The day so far

There wasn’t that much that interested me. My current baby TRXC was down so I had to check that out. Other then this, I did not see anything exciting. ENPH moved up on my list, but volume wasn’t all that. CLNE was breaking out, but I was in TRXC so I skipped this move. AXON needs room to breath a little so I skipped that ticker too.

TRXC

As the header said that this was a nail ‘n bail type of move.  Fridays resistance was at 4.80 so this was the point I was eyeing. However, 4.50 was heavy so I started my attack there. Then the ticker moved again from 4.40 to 4.60 and failed again! so I added AGAIN at 4.50 and covered into that 4.40 – 4.35 wash. Nothing really excited about this, apart from the stuff move, double top at 4.60. It is testing that number right now and I might enter AGAIN! at 4.50. Rinse and repeat I guess. FWIW, I was expecting 4.30 to fail as this was previous support. But that 4.40 actually held too so that kind of scared me. What I am wondering now is if TRXC can actually go red to green from here. I am not a long biased trader and I have no clue what can happen as both a double top and double bottom happened. But the volume is there and there is interest for both a gap fill to 5.00 and a potential break out from 5.00, the 52 week highs. This could be quite interesting!

SWINGING

TRXC is holding trend. You can see, from the reversal from 05/04/2018, that TRXC has followed its tend numerously till date, holding significant key levels like 3.00 and 3.50 on 06/21. It seems to hold 4.00 well as well. I might build a long position to swing a bit from 4.80’s, if this level ever starts to base. This chart isn’t that different from I or HEAR in terms of following trend.

BIGGER PICTURE MOVES

As my strategy revolves around stocks that are over extended, I also have to look at the bigger picture of a stock. First I look at the daily chart and review the support and resistance levels. Questions I ask myself are, what have they done in the past? And what can be expected from these support and resistance levels? Where is the stock going? and what is the overall trend.?

In case of TRXC, the trend is upwards towards that 5.00 dollars 52 week high. As mentioned before, it has held support in the past. however, I also see a a few stuff moves happening at key levels too, like at 4.00 and 4.80. I also keep in mind that 4.30 was support in the past so this was an important level for me t attack with shorts.

The stochastic were telling me, however, that this stock is over bought and that there is a big chance that resistance will be heavy. When a stock is not overbought (below 80) there is room for more continuation. Not that this is THE indicator. But it does give a slight idea that there is either room for an upwards or a downwards continuation. TRXC is very overbought at this point, so my plan is to wait a bit and see what happens after the 52 week breakout. I might sit by the sidelines and wait for this upward trend to slow down and start shorting that 4.80 support area.

HOW DO I APPROACH A STOCK?

There is a massive gap down potential too on TRXC. Some traders have eyes for this like Steven Dux as example. These big boys like to short the first red day as this has a 80% win rate short setup. I, however, like to wait a little and see what happens when that high of day, on the first red day, is re-tested. That is where I love to attack with shorts. In this case I will wait a few days and see of any levels seem to base. These are the levels I have my eyes on. Either a push towards the recent highs or a gap down towards the recent support. My dream trades are when a stock is testing highs, but fails. Stuffs and fails every key level below that like VWAP, 50 day EMA, Green to red moves and preferably previous key support levels failing. All these levels tell me to add to my short and add, add and add some more to build a decent position. I plan my risk according to my size and previous resistance levels. I will exit any major washes as stocks tend to reverse after a wash. A significant wash is a key indicator to get out of my position or cover the larger part of my position. Keep in mind I do not go ALL IN. That’s just crazy. What has saved me loads of times is to have a mental stop based on a % of your overall capital. Some traders use support and resistance levels as risk, but this did not work for me. When support fails, the ticker almost always drops significantly. And even worse, when you are short, with size, and resistance does fail, you can easily blow your account!

STYLE OF TRADER

I cannot really define my style of trading. Sometimes I scalp, sometimes I swing and sometimes I nail ‘n bail. Nail ‘n bail, for me, means to hold until an intraday gap up or intraday support / resistance fails. This method has helped me to protect my cash and protect me. I am also the type of trader that leaves the computer before lull sets in. After market closes, I do update my spreadsheets and review which setups have worked and if I can spot any new setups that might be interesting.

I take my time, okay? And so should you! Learn, study, practice and plan. That is all. This takes time. But with time, you will get there. Even with a stupid $500 account. If you are patient, even such a stupid amount can make you a millionaire. It will take time. Maybe even 10 years. But with these strategies that  Tim Sykes and Investors Underground offer, you will be able to get there. Just trade carefully and cut your losses quickly. You can always try again!

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