So many biotechs are in play now. SWBI EDUC, so many small-cap bios also.
August 14, 2020
FIT is getting bought out for $7.35 a share cash. It's currently in the $6.30s. That is a 15% spread. There is some uncertainty regarding it going through. It seems to be mostly concern in Europe I have been reading. I think the risk reward is there especially if it goes to a 20% return or more. I bought a little around here.
PRTS has now become my best performer ever with over a 1,000% return. I've been posting that one on Twitter for awhile. I believe initially it was around net tangible asset value when I found it in the $1 to $2 range. I noticed it as a turnaround play with focused management.
Awhile back for long-term positions I bought Carnival (CCL), Hotel (SOHO), RIG. More recently I added online education plays EDUC, TWOU, XOM for the dividend, gold/ silver via CEF and Smith and Wesson SWBI.
January 18, 2020
When I say penny stocks I mean like $0.50 to $10. The range of penny stocks is actually more like $.0001 to around $5 or so. I prefer the $0.50 to $10 most of the time. In 2008-09 a lot of "penny stocks" were actually mid and large caps that were just that beaten down though. So that's how I got into the low priced momentum stocks. There are many other things and ways to trade. It just made sense to me also to stick to a niche that has less big institutions competing against you. The stigma of penny stocks keeps people away too. it takes more resources and intellect to trade large-cap stocks against the big guys. More "edge" I think.
I scan for stocks in Stockfetcher with my custom scans I've accumulated over the years. I have 36 scans on there. Some are just new 52 week highs combined with other criteria and simply uptrend charts etc. Most days I will go through only a handful. Still to do it right I have to look at atleast 100 charts. When one scan is working I keep going back to it. Some pick up on sector rotation well and I want to be in the hot sector most times.
I have just been looking for long setups for awhile but I scan for short selling setups too. For long setups I have a keen eye for bull flags, high bull flags, long bull flags, trading range breakouts and triangular formations. I strictly use candlestick charts with a white to red contrast on the bars. White for positive, red for negative. The same goes for volume at the bottom of the chart. It's incredibly important for me to know which days were positive and which were negative.
For my first example I will use a recent runner PTI that I alerted on Twitter back in December. This is a high flag or high bull flag. It's characterized by a strong up day followed by only a couple or so sideways consolidation days. This one had 5 days until the big spike. It's still a high flag because price never moved down much all those days. It just hangs around the breakout area. It's a very strong momentum pattern. Notice the lack of any major selling volume on the bottom of the chart where I circled. If there aren't sellers it's still being accumulated. Another thing about flags is the consolidation days or rest days have to have low day range or volatility. It can't drop 20% then come back up and still be a flag. It's a battle between buyers and sellers and price stays about the same day after day.A high flag can be an ascending triangle formation. See the lines I drew to show the flag? Some high flags just consolidate downward after the run day for a couple days and don't look exactly like this one. High flags to me have a short consolidation period of 2 to about 6 days. Usually closer to 2 to 3.