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How To Prepare For Your First Day of Trading

Nick P — Tue, 14 Dec 2021 15:16:55 +0000

Wondering what it’s like to day trade for the first time?

As a newcomer to this industry, you will have tons of mixed emotions approaching your first day in action.

You don’t want to show up to your first day fearful and scared. If you prepare and get educated, you will come in as a trader, NOT a gambler.

Today we wanted to make a guide that will help calm the nerves on your first day at the screens and will help you prepare for a successful jumpstart to your career.

Learn Before You Earn

Success is made through education and practice. A lot of new students come into our programs with no experience at all, watch one video, and BAM, start trading the next day. 99% of the time, those traders get wiped out and take a huge confidence hit.

To prepare successfully for your first day means to study beforehand. Make sure you have completed a full study course, not skipped around any areas, have all of your boxes checked on the educational side of things, and know a core set of THREE strategies/patterns max you are going to look for.

Study for weeks before your first day, get a grip on your trading strategy and plan, and then you can hit the trading desk.

Just take it from one of our students here, Bobby, who realized that education comes FIRST, trading comes SECOND!

Practice on a Simulator

While it won’t accurately simulate the real emotions of trading, simulated trading will help you get the basic mechanics down. Learn how to trade your strategy in real-time. Learn how to execute orders, buy, sell, stop loss. There is no point in trading real money until you are at least profitable on a simulator.

Play What Is Moving

When you are a new trader it can be hard to gauge which stocks or setups have momentum. A lot of experienced traders just have that feeling that can help them feel when ‘mojo’ is coming into a stock at a given point. To avoid looking all day at dead setups that have no potential, as a new trader you want to focus your attention on stocks that have already traded over 1 million shares for the day, and trade consistent volume every day.

You don’t want to look to trade the stock on your first day that traded 7k shares yesterday and 50k today. Make sure your scanners are set to only show you stocks that have volume and activity so you don’t get caught in low liquidity traps. Watch this video below to learn more about how to scan for the best stocks to trade:

Set Your Platforms Up

Don’t do this at 9:25 AM. You’ll want to have your charting platform and order entry system all set up and on your screens the night before. Tomorrow is your first day remember, so you want to be as prepared as possible. Make sure your charts have all the indicators they need, look good, your level 2s are up, hotkeys ready and programmed (if you are using them), and all your windows are in the correct spots. This will save you tons of time and frustration the following morning by having everything already there and set for yourself. You want to be as clear-minded and sharp today as possible. Limit distractions.

Make a Watchlist

Take an hour the night before and create a watchlist. Get at least 3-5 stocks ready for the bell tomorrow so at least you have something to look for if the gappers and morning section is light. Doing this the night before when you are relaxed and your mind is clear will create a good habit and routine and also help you choose clearer setups. Watch this video below to learn how to build a successful watch list:

Get Your Mind Right

While we have been preparing for this huge day, you have to also take a step back and realize this is a long journey. It is a marathon, not a sprint. You don’t have to become a millionaire today. You have time to learn, grow, adapt, and scale your account steadily. Don’t rush things on your first day and have ridiculous expectations. Whether you are green or red on your first trading day does not determine the fate of your trading career!

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6 Signs You’re Trading Too Much Size

Nick P — Wed, 01 Sep 2021 16:12:40 +0000

More size means more profits right?

Most of the time, this is not the case for new traders. Money creates emotions. If you increase your size too much, it becomes difficult to control and manage your emotions.

Emotions will be in your trading no matter what. Succesful trading requires not the elimination of emotions, but management.

If any of these signs sound familiar, you need to start reducing your trading position size:

You Focus on Your PNL All the Time

You chase PNL, it runs. This is one of the most common errors a new trader makes: They constantly pay attention to how much they are up or down in a trade.

This causes poor decision-making because you’re making decisions based on your PNL instead of the market trend.

Pro tip: Hide your unrealized PNL on a trade. This will help keep your focus on what matters: The charts.

You Cannot Leave the Computer

A trade shouldn’t chain you to your computer to your phone. You should be able to comfortably leave for a minute or two without panicking. If you feel too scared to leave a position unwatched for a few minutes, you’re trading too large.

You Take Profits Too Soon

That’s my mortgage. That’s my car payment. That’s a week’s worth of groceries.

When you assign value to unrealized gains in the markets, it can cause you to take profits when you shouldn’t. While this is effective for curtailing greed, in the long run, early profit-taking has disastrous consequences for your long-term PNL. Learn to find that “sweet spot” with your position sizing:

Take profits based on price action, not what the unrealized gain is.

You Stop Out Prematurely

Have you stopped out before because you were scared, just to watch the stock reversed on you and go to the moon!

If you’re jumping in and out of positions, it’s because you’re fearful of the money being risked. Cut down your size to eliminate this fear. Pre-define your risk before every trade: Are you truly okay with losing $200? If that makes you nervous, lower that number.

Losses Cause You to Adjust Spending Habits

Only risk what you can afford to lose. A trading loss should not cause you to change what type of fuel you get at the gas station. Or what type of food you buy.

You can only be a successful trader if you trade what you can afford to lose. NEVER trade with money you need to survive on. You will not be able to view the market objectively and let our trades play out.

Anything can happen in a trade. Even a strategy with an 80% win rate has a 20% of losing on any given trade. Trading with money you can afford to lose allows you sit back and view markets objectively.

You’re Afraid to Take a Loss

We’ve seen it happen too many times. Traders freeze up, and the loss gets so big that they cannot bear to realize it. Eventually, usually by force from the broker, the trader is liquidated and realizes a massive loss.

This is the opposite of what can go wrong with stopping out pre-maturely. Stopping out too late. This ties back into trading with money you can afford to lose: What you are risking on a trade shouldn’t make you so emotional that you freeze up.

Struggling with managing your trading positions correctly? We have multiple classes dedicated to this important topic in our 60 Day Live Trading Boot Camp:

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How to Trade “Sell the News” Plays | $SPCE Example

Kunal Desai — Mon, 12 Jul 2021 22:05:31 +0000

Buy Virgin Galactic at the open today expecting it would go to the moon? The stock had great news, why did it tank today?

The stock market isn’t that simple. Get familiar with this phrase: “Buy the rumor, sell the news”.

This is one of the most counterintuitive aspects for new and inexperienced traders. Today’s blog will clear up your confusion:

What is “Sell the News”?

One of the most important lessons you need to learn as a trader or investor in the stock market, no matter what time frame you trade on: Price action is always king.

I’ve seen stocks rally on some of the most horrendous news you can think of. I’ve seen stocks tank after reporting blow-up earnings reports. “Sell the news” events are when the stock rallies leading up into a positive company event, like an earnings release for example, and then sells off as soon as the event occurs.

The stock will often gap up during pre-market once the press release hits, and then reverse as soon as the market opens as sellers enter the market. This is called a “gap and crap”. Here are all 6 types of stock gaps you will see at the market open:

So what causes stocks to abruptly reverse at these key moments when the outlook of the company has never looked better?

What Moves Markets

Markets are moved by supply and demand. News can cause shifts in supply and demand, but the news itself is not what moves markets.

Often the good news will already be priced into the stock BEFORE the event happens. By the time the event happens, the stock has become a crowded trade. The edge becomes to do the opposite of the crowd.

$SPCE Example

Richard Branson flew into Space yesterday in the world’s first space tourism flight. An insane accomplishment, and seemingly positive news for his company Virgin Galactic.

But look what the stock did as soon as the market opened today:

It dumped almost 20% in less than half an hour. Plus the company filed today an offering to sell up to $500 million in stock. Even the insiders understand how “sell the news” works!

Another good example from last year is Pfizer:

The day after it announced the success of it’s vaccine trials it gapped up 20%. And look what happened after. It tanked almost 20% over the next few days.

How to Trade “Sell the News” Events

News catalysts are great for bringing momentum and liquidity into a name. But they do not by themselves give you a trading edge. If it was that easy, no one would need to work a regular job. You’d just buy on good news every time, and short on bad news.

With these kinds of widely anticipated company events, you need to think about which side the crowd is on. Many of these are “crowded trades”, trades where everyone is taking the same position with the same thesis. The edgie is going short, which I did this morning:

Lately, these gaps start fading pre-market, so you need to hit them on a spike right at the open to catch the move! The key is to align the context, a “sell the news” play, with an intraday setup to give you a low-risk entry to take down these stocks.

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5 Trading Psychology Lessons Every Trader Needs to Learn

Nick P — Sat, 23 Jan 2021 22:38:29 +0000

In trading, you are your own worst enemy. Fear of missing out and chasing. Fear of taking losses because you’re scared. Not taking profits because of greed. Revenge trading because you want to make back what you lost. No matter what stage in your trading journey you are in, trading psychology is the biggest obstacle for traders to overcome.

Today’s article will show you some of our favorite strategies to overcome some of the most common psychological issues all stock traders and investors face:

Combating FOMO (Fear of Missing Out)

FOMO is the most common reason why we buy stocks to high, or short to low. One of the worst feelings in trading is watching a stock make a big move without you. For some traders, it’s even worse than taking a loss! The stock market is so big, and there are so many stocks moving every day, you will always be missing an opportunity. You have to learn to combat FOMO to become a consistently profitable trader. This video lesson will help you learn how to overcome FOMO:

Sizing Positions Correctly to Avoid Fear

Position sizing plays a major role in trade management. One of the most common mistakes traders make is sizing their positions too large. It puts them at a bigger risk of taking a massive trading loss and also makes their trade management much worse.

When you are trading huge size, you will take profits at the wrong places, stop out either too early or too late, and generally be a lot more emotional in your trading. Reducing your size will actually make you MORE money, because of how it reduces emotions and improves your trade management. This video lesson will show you the importance of sizing positions correctly, and how to break the bad habit of over-sizing:

No Emotional Attachment

One of my favorite trading quotes: “Trade the ticker, not the company.” One of the biggest issues traders have is an emotional attachment to the stocks they trade. Their attachment causes them to mismanage their positions.

These traders will usually either fail to take profits when they have them or fail to stop out of their positions when the loss was small and manageable. Here is how you can combat emotional attachment in your trading:

How to Scale-Out of Positions to Reduce Greed

Timing exits is one of the trickiest parts about trading stocks. Selling too soon and missing the big move. Selling too late and watching a nice unrealized gain come all the way back to breakeven or a loss. I’ve found the best exit strategy to manage these two problems is to scale out of your positions, which means taking partial profits (½, ⅓, ¼). This video lesson will show you how to scale out of your positions correctly, and manage greed while you’re in a trade:

Revenge Trading: How to Stop Forcing Trades

Every trader’s reaction after taking a trading loss: “How can I make this back”? Most traders jump on the first stock that moves, take another loss, and then end up further in the red. Next things they know, a small manageable red day turns into a day that undoes weeks and months of green. The best traders don’t let trading losses affect their trade selection, and don’t get emotional. Here are some of the best strategies to combat revenge trading:

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How to Trade Short Squeezes: $NNOX Example

Kunal Desai — Wed, 23 Sep 2020 15:09:34 +0000

We’ve seen a shift in the stock market trend the past couple of weeks. The market has been on a monster tear since the crash in March. We finally have seen a significant pullback in the markets that have failed to immediately get bought up. These market pullbacks can offer amazing opportunities to both the shortside and longside. Short squeezes are one of the best trading setups to use to bounce a stock after it has pulled back for a few days.

Learn how to use this setup in our latest video lesson, where I recap a recent short squeeze trade I took in $NNOX:

What is a Short Squeeze?

A short squeeze is simply an increase in a stock’s share price because of short covering. When you short-sell a stock, you borrow shares from your broker and then look to buy/cover them at a lower price.

However, if the stock keeps going up, shorts will have to cover their position in order to avoid a big loss. As short-sellers scramble to cover their positions, they have to buy their shares back from their broker, causing the stock price to increase rapidly in value due to the increasing demand.

Short Squeezes = Short Term Trades

Treat a short squeeze trade as a short term trade, such as a day trade or a short swing trade. In order to trade short squeezes successfully, you have to have good timing. These are not trades to marry.

Pay attention to a stock’s short interest, which shows an approximation of the number shares short a stock. Stocks with high short interest are good candidates for this setup, especially when combined with a technical pattern. You can see a stock’s short interest on shortsqueeze.com.

Thoughts on the Overall Market & Stocks to Watch

In the last few days, we have seen signs of the market putting in a temporary base and beginning to rally. This is a great time to pick up some strong stocks that have pulled back with the market in the last couple of weeks.

Here is video lesson from this morning where I run through some of the best stocks to watch this week:

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3 Day Trading Setups I Use Every Day

Kunal Desai — Sat, 21 Sep 2019 07:04:50 +0000

The stock market can seem random and chaotic. In order to consistently profit from day trading stocks, you MUST use day trading strategies that have an edge. Many traders fail because they trade strategies that don’t have positive expectancy.

This means that in the long run, they always lose money because their day trading setups have no edge. They are the suckers playing the slot machine. Successful traders have setups that make them the casino. They know in the long run, they will always make money.

Today I will talk about 3 of my favorite day trading setups. These are the go-to setups that I can rely on for consistent income. Every trader needs these, and for every trader they will be different. Before I give you these setups, it is important you understand exactly what a day trading setup is.

What are Day Trading Setups?

Day trading setups are another word for day trading strategies. A day trading setup is simply an entry strategy for getting into a stock. A setup defines a set of criteria that need to be met in order to enter a trade. Without a setup, you are just gambling at the casino when you enter the market.

Now that you understand exactly what a setup, let’s get into some of my favorite strategies. Here are 3-day trading setups that I use on a daily basis:

Short-Selling Breakdowns

Stocks that report negative news will often have large moves to the downside during pre-market and after hours. This momentum will often continue into the market open, and provide great short selling opportunities. I will look for these downtrending stocks during pre-market, and look at their charts to find a good entry point for an entry for a short sell.

The best breakdown plays gap down under nearby support on their daily chart and increases the probability that sellers will enter the market, causing the stock to depreciate in value. Here is an example of earnings breakdown play I took on $X:

Day Trading 2nd Day Continuations

A lot of traders get FOMO after missing a big move in a stock. What they don’t understand is that stock trends will typically last multiple days. The following day after a stock has made a strong move is often actually easier to capitalize on than day 1.

When trading a continuation play, I am looking for an entry to join the trend that is continuing from the prior day to the long or short side. Here is an example of how I day trade 2nd day plays:

VWAP Pullback

The VWAP (Volume Weighted Price Average) is a great indicator to gauge a stock’s trend. It is a great tool for managing your risk for day trades. It often acts as support and resistance for stocks intraday. One of the favorite strategies using the VWAP is the VWAP pullback.

This is a setup you use between 10:30-4 (not during the open) to buy shares on an uptrending stock after it has pulled back and retraced to its VWAP. Entries by VWAP can give you low risk, high probability trades.

It can also be used to short stocks downtrending stocks and is one of my favorite mid-day setups to day trade stocks. Here is a video lesson going over a trade I took using this strategy:

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5 INSANE Stock Charts From the Past 12 Months

Kunal Desai — Fri, 13 Sep 2019 10:07:27 +0000

The last 12 months in the stock market have been INSANE. We have seen one of the strongest rallies in the DOW and S&P ever, IPO’s running on a weekly basis, the marijuana stock bubble, and a ton of other crazy moves in tech stocks.

Here are 5 of the most unique stock charts, and some stand out market movers from the past 12 months (I didn’t include any penny stocks!!). Study them closely, because these patterns WILL repeat themselves:

$TLRY: Tilray Parabolic Summer 2018

Tilray is an IPO from last summer that ran from about $20 to $300 per share in about a month and a half. Every pothead and their mom owned this stock last summer. This was during the period right after Marijuana distribution usage was legalized in Canada, and many Cannabis-related companies like Tilray had some monster run ups.

But TLRY was the biggest of them all. It went from about $20 a share to a high of $300 in just two months. And then it gave it all back! Now it’s trading under$50 per share, and its bag holders galore.

$BYND: Beyond Meat IPO Run Up 2019

Beyond Meat is essentially a company that makes “supposedly” plant-based meat. It IPOed earlier this year and was a very similar play to Tilray. It just slowly grinded up ever since it’s IPO. Funny thing is that it’s still hanging around today at about $150 a share, still up more than 200% from it’s IPO price!

$ROKU: Post-Earnings Run Up Summer 2019

ROKU had earnings a few weeks ago, has been on an insane run the past several weeks. The day before it’s last earnings report it closed at about $100 a share. About a month later, it hit a high of about $180 a share! Overbought can more overbought, and oversold can get oversold.

$SHOP: Shopify 2019 Monster Uptrend

Shopify has been a MONSTER this year. Started the year at about $130 a share, and last week it almost hit $400. Funny ROKU and SHOP have been public Citron Research short calls! Goes to show you what happens when the consensus takes a position, and then things start to go south!

$SPY: Insane Recovery From 2018 Crash

SPY hit a low of around $230 in December 2018. In just 5 months, it came all the way back to make a new all-time high. Funny how this year was predicted in January to be the worst year in the stock market in the past decade. And it actually ended up being one of the strongest years ever!

Biggest Lessons

-Do the opposite of consensus, mainstream predictions

– Timing when short selling is EVERYTHING

-Markets can stay irrational longer than you can stay solvent

– Stocks take the stairs up, and the elevator down.

-Sell into strength, before the crowd panics

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Swing Trading vs Day Trading: Pros and Cons Of Each

Kunal Desai — Wed, 21 Aug 2019 19:11:22 +0000

Swing trading and day trading are the best style of trading for making large returns in just days or weeks. They do come with more risk and difficulty than long term investing and the traditional buy-and-hold.

But the reward of executing these two styles of momentum trading correctly can exponentially grow a trading account. In this article we will talk about these two styles of investing, and help you figure out which style you are best suited for:

Swing Trading vs Day Trading: The Differences

Day trading is defined as entering and exiting a position within the market hours of one day. This can mean buying (or shorting) at the opening bell, holding all day, and then closing the position right before 4PM, when the market closes. It can also mean buying a stock and then selling 3 seconds later for a quick scalp.

Swing trading is buying or shorting a stock and then closing the position more than one day later. Buying a stock right at the close and selling it the next day at the open is considered a swing trade. Swing traders are looking for larger moves in the markets that take longer to fully develop.

Why These Styles Are The Best

Day trading allows you to capitalize on profitable short-term movements and setups that are only valid on the intraday time frames, such as the 1-minute and 5-minute charts. Day trading also eliminates the risk of holding a stock overnight. Day traders can capitalize on short-term market movements, and do not have to worry about the overall market conditions as much. This style is a very efficient use of capital because you can rotate your capital into trending stocks and capture multiple high percentage moves in a short period of time.

An advantage of swing trading is that a single stock can yield substantial returns over the course of several days. Several well-timed swing trades can grow a trading account significantly in a short period of time. Unlike day trading, a swing trade doesn’t require precisely timed entries or close intraday monitoring. In general, it is a better style of trading for someone who has a full-time job during market hours that is less time consuming and less stressful for the most part.

Day Trading Pros

Potential for large returns in a short period of time (minutes and hours)
Only need to trade for the first few hours of the day (still need to put in work outside of market hours, especially pre-market)
No overnight exposure
Less concern for macro market conditions
Capital not tied up for long periods

Day Trading Cons

Pattern Day Trading Rule: If you have less than $25k in your trading account with a US broker, you can only make 3 day trades every 5 trading days (1 trade defined as a buy and sell). Learn more about the PDT rule here.
Higher stress
Requires quick reactions and decisive thinking
Need to be in front of a computer during the market open at 9:30 am EST (many people have a full-time job which makes this difficult)

Day Trade Example: GHSI

Here is an example of a day trade one of our moderators in our day trading chatroom made on $GHSI. He bought shares of the stock at $1.76, and over the next 13 minutes, sold 1/3s of his position at $2.04, $2.33, and $2.38. The green arrow on the chart is where he bought, and the red arrows are where he sold. This example demonstrates the power of day trading if executed correctly: An over 20% return in less than 15 minutes.

Swing Trading Pros

Less micromanaging
Don’t need to sit in front of a computer all-day
Easier style to execute with a full-time job
Can capture large returns in just a few days or weeks

Swing Trading Cons

Slower moving
Overnight exposure
More susceptible to news and macroeconomic events
Capital tied up for longer periods of time

Swing Trade Example

This is a screenshot of our swing trading chatroom, with our head trader Paul Singh. He calls out all of his swing trades to members. You can see how he bought NFLX at $314.40 on July 24th, and then sold his shares at $330.50. This is a swing trade, because he held it for 2 days.

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Exhaustion Gap Definition: One of the Most Powerful Reversal Setups

Nick P — Mon, 12 Aug 2019 17:49:42 +0000

An exhaustion gap is a critical concept to understand when trading stocks at the market open. A gap refers to a stock that opens above or below its prior closing price. An exhaustion gap is different from most gap ups or gap downs in that it quickly reverses from the direction the stocked gapped in.

It is characterized by a strong counter-trend move in the opposite direction a stock has been trending in for prior days/weeks. There are two types of exhaustion gaps: Bearish exhaustion gaps, and bullish gaps. Here are examples of both:

Bullish Exhaustion Gap Example

A bullish exhaustion gap occurs at the end of a strong downtrend in a stock. Here is a bullish exhaustion gap example with Kroger stock:Notice how it has a huge red day right before the circled green candle. And then the stock gapped down, even more, the next day. At this point, all of the supply has dried up since the stock has dropped so much in a short period of time (in this case it was bad earnings) and it was due for a dead cat bounce. As soon the market opened the gap was bought up and the stock rallied strongly.

Bearish Example

A bearish exhaustion gap is the opposite of a bullish one. It is a stock that gaps up which is sold into strongly. Here is an example of a bearish gap in Nvidia stock:You can see how it had a strong run-up, and then a huge green day the day before it had that huge sell-off into the exhaustion gap. It gapped up even further after a big day, and there was a scramble for traders and investors to take profits soon after the market opened.

Anticipating Exhaustion Gaps

You are probably thinking: How do I know the difference between an exhaustion gap or a gap that is just a trend continuation? How you can identify a likely exhaustion gap candidate is a stock that starts to reverse trend soon after the market opens after a big gap up in a strong uptrend or a big gap down in a strong downtrend.

As seen in the examples above, the exhaustion gap is the trigger for a short term trend reversal. Being able to recognize exhaustion gaps will allow you to take a position in a stock in anticipation of the gap reversing. These reversals will often be strong, as you can see in both examples, and can be great day trading opportunities if executed correctly.

Trading Exhaustion Gaps

This is a SHORT TERM trading setup. This is a trade you want to be holding for several hours, or maybe a couple of days. This is not a setup that you want to marry forever. NVDA resumed trend later that year and starting a run to the high $200’s. To make these high probability setups, you need to have EXTENSION in the names of interest. They have to be in an overbought or oversold state to make the setup trustworthy. This means you would to see an RSI above 80 for a short, or below 20 during the morning of the gap up.

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How to Trade Stocks with Short Sale Restrictions (SSR)

Nick P — Mon, 29 Jul 2019 21:32:23 +0000

The short sale rule is one of the most pointless rules in the stock market. But you have to understand what it is as an active stock trader, as it has a big effect on how a stock trades once it gets triggered. Today we will talk about what SSR is, how stocks tend to move with short sale restrictions and some tricks for successfully trading stocks with SSR on:

Shorting Stocks

Before we can get into the Short-Sale Rule, you need to understand short-selling. Short-selling is simply making money when stocks go down, instead of when they appreciate. You borrow shares from your broker, and then by them back at a lower price. If you are confused by short-selling, make sure to read this blog before continuing in this article.

What is the Short Sale Rule(SSR)

The short sale rule (SSR) is triggered when a stock goes down more than 10% from its prior close. SSR remains on a stock for the rest of the trading day when it’s triggered and remains on for the following trading day as well!

The SEC made this rule to prevent short sellers causing a stock to tank. All it really does it make it difficult to short. The people who want to short are still going to short the stock.

A stock having short sale restriction just does not always affect the probability of the stock going up and down. Do not buy a stock just because it has short-sale restrictions on.

The exception for that rule is in small-cap stocks, as these can be manipulated easier due to their lower float. It is much for a 3 million share $5 stock to drop 50 cents than it is for Netflix to drop $30-$40 a share. Strong, uptrending, low-float stocks + SSR can be the recipe for a big squeeze.

How to Tell if a Stock has SSR On

A stock will have an “SSR” on the Level 2 montage in the top right. See the example below:

Trading Stocks with Short Sale Restrictions

Stocks with short sale restrictions can be tricky to trade to the short-side. A lot of times stocks with bad news will gap down during pre-market and trigger SSR. They will often grind down slowly and then have big pops, and then continue to fade. They can provide great shorting opportunities, but you have to have good timing.

The number one rule for trading stocks with SSR: Don’t short them at lows. They will either flush and not fill you, or they will usually have a big pop, and you are stuck with a bad entry. You want to wait for a spike to get a good entry with better risk vs reward.

Getting the Right Entry

One of the biggest difficulties with SSR is that if you want to short them, it can be hard to enter, cause you need the stock to an uptick in order to fill you. As a result, you need to wait for the stock to pop a bit in order to get filled. You have to be strategic about where you place your orders to get filled, especially if there is a spread.

Use the VWAP and moving averages to get filled on these names, or try to get filled when they are consolidating in a bear flag. When a stock is trading in a range, that can give you the uptick you need to get filled. I recently traded a few stocks last week with SSR. I did a market recap recently where I breakdown how I traded them in more detail (talk about it at 10:00):

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