I have not been quite as accountable as I should be in the past two weeks. It is not that I have not continued to trade, but that I rather have felt a sense of frustration. Anyway, I have preferred not to relive these trades again. Nevertheless, some developments today made me aware of the importance that reflection has, especially during times of frustration.
Therefore, in this post I´ll keep you updated about my last trades and today´s opportunities, which I missed due to some factors that I will write about.
So let´s get it started.
OTC stock USRM (U.S. Stem Cell Inc., Biotechnology Sector) decided to break out of it 8.25 cents resistance on September 9th. I had been waiting for this breakout and therefore decided to trade this.
Right in the morning, USRM accelerated and squeezed to a high of 9 cents. I was expecting the usual OTC breakout pattern however and therefore planned to buy the dip. And the dip presented itself. When USRM sold off below the breakout level at 8.25 cents, I hesitated only for a second (a little to long) and entered at 8.25 cents. Recently, I have been able to buy into these dips without a lot of stress pretty nicely and I am satisfied with this entry. Just as the other recent breakout plays such as GOPH and vend, USRM hovered around the breakout level for a long time. There was support at 8 cents and I decided to stop out below this level. Since I did not want to be shaken out too easily, I gave myself a little room however. It turned out that USRM did not bounce. Instead, toward the end of the day support got tested again. At 8 cents, a huge buyer was sitting and I decided “to see” if he was taken out. At this point my reaction was too slow however. The buyer got taken out rapidly causing a quick panic. Instead of exiting at 8 cents I got filled at 7.8. What should have been a minuscule loss given a tight stop, became considerably larger one.
Overall, the trade was not so bad. The breakout turned out not to work this time and that is OK. I did not chase and bought the dip nicely. However, when exiting I should have been way more decisive. After all, exiting into an OTC panic is almost impossible and serious slippage may be a result.
Recently, there has been a slight rebound in the price of Bitcoin which brings us to the second stock that I want to write about. BTSC (Bitcoin Servics, Inc., Cryptocurrency Sector) was a truly amazing stock when Bitcoin was hot in December of 2017. However, given the chart below I think it is correct to say that it has not performed too well in past months.
But the crypto crowd consists of true believers and the recent relief has led to some nice price action in this sector. On September 13th BTSC broke out of multi day 8 cents resistance. I waited for the typical pattern and planned to trade it.
By now we know how the pattern plays out. BTSC spiked and then dipped back quickly. I jumped in and entered my position at 7.9 cents. BTSC started to not to do a lot after my entry. At this point I was making my plans where to set my stops, where possibly to exit and if simultaneously to have an eye on the Bitcoin price action. I was not certain at all at this point how to answer these questions. The previous day BTSC had spiked in the morning, dipped afterwards and then had done nothing for the rest of the day. Now I feared a similar price action for the day. Given the breakout my plan should have been clear: to hold BTSC unless it broke considerably below the 7.9 cents dip. However, I got bored and exited at 8.15 cents for a very small gain.
As one can see BTSC did shake out some longs when dipping below 7.9 cents. This demonstrates the necessity to leave some room to not become one of those weak hands. Later in the day BTSC reached highs of almost 9 cents however and I was sitting at the sidelines.
This morning BTSC broke out yet again. This time 9 cents gave away pretty quickly and 9.4 cents were reached in no time. At this point I waited for the pullback to buy at 9 cents. The pullback came, but reached only 9.1 cents. I did not want to enter on a higher average cost basis and missed my entry. BTSC spiked to almost 9.9 cents just a few minutes later. I think in this case I very well could have tried to buy at 9.1 cents given the fact that this was VWAP. Of course, a higher cost basis equals a larger loss given the same stop price and I did not want to risk a lot of capital given yesterday´s trade.
This trade most likely was the worst one I have done in quite some time. The entry was rushed, the exit was rushed and I had not clear plan.
CELZ (Creative Medical Technology Holdings, Inc., Biotechnology Sector) gapped above 1.4 cents yesterday. Even thought this is not the high of the past weeks, this level proved to be resistance the previous 4 times. Therefore 1.4 cents seemed to be crucial to me and I planed to buy the dip.
The dip came. But instead of buying close to the lows of 1.33 cents, I chased and bought at 1.41 cents. Given this higher cost average I was already very uneasy. There was no clear support to base my risk off of. I decided to give CELZ a little room below 1.33 cents and thereby to risk more of my capital. When support got tested however, I suddenly changed my mind and sold all. I acted emotionally and sold right at the near term bottom. As if to laugh at me, CELZ at first confirmed the breakout pattern and spiked to 1.48 cents. Later in the day it was a faded however and sold off considerably. Paradoxically, I most likely would have lost more, had I followed my plan. I must not fool myself however. This trade was executed badly from start to finish and I must follow my plan.
This brings us to today´s price action and the fact that there were some incredible opportunities which I failed to profit off. Of course there is hindsight bias in my reflections and I forget about the losses that I did not take by not trading. But I feel like I hadthe right feeling on quite a few plays. Nevertheless, I was not decisive enough and ended up not trading today.
Besides BTSC there has been another OTC breakout in recent days. this is FUSZ (nFüsz Inc. Media/Technology). After breaking out at $2.1 it reached highs of $2.64. Even though this was on my watchlist when breaking out, the price action seemed a little off. Therefore I missed this opportunity.
I (Intelsat S.A, Communication Services) has been one recent parabolic stock which seems to have topped. Today it has been fading throughout the whole day . I thought about shorting into VWAP at around $8.5 with a longer time frame but ended up not doing it due to my lack of short experience. This chart looks a little like the recent GERN chart and I will plan a possible short tomorrow.
Chat pumps have been a gift of gods for short sellers recently. Today SINO (Sino-Global Shipping America Ltd., Shipping Services) spiked out of nowhere due to a chat pump. It turned out to be an awesome short opportunity fading all day after the rats had exited the sinking ship. I did not consider shorting this at this point however.
The serious opportunity that I missed today was buying the rebound on VTVT (vTv Therapeutics Inc., Biotechnology Sector). This stock has been incredible in the past few days squeezing shorts day after day.
And today was no different. In the morning it seemed as if the action had shifted. However in the afternoon (CEST) VTVT slowly grinded towards VWAP and finally reclaimed. At this point level 2 was very much telling what was going on. The bid would not disappear and soaked up all the offer. I felt very bullish at this point but was undecided given support 20 cents lower. I was just not decisive enough and when I finally decided to lower my position size and buy at $1.99, VTVT went to almost $2.45 in a matter of three minutes. Probably a big short seller had to cover. Anyway I was sitting at the sidelines. This indecisiveness is not acceptable in a situation like this. If I feel uncomfortable with my risk, I have to lower my position size. But I must not miss these kinds of opportunities.
Finally, SDRL (SeaDrill Limited, Basic Materials Sector) offered a similar opportunity. Similarly to VTVT, SDRL had spiked big time yesterday. Today it started weak too. But when VWAP finally reclaimed the buyers gained control.
SDRL squeezed from 34 cents to almost 40 cents. Even though I was watching the VWAP reclaim closely, I was a lot less convinced about the odds of this opportunity and therefore I did not consider SDRL.
There were however the plays that I wanted to play. I should have ended up taking action on some opportunities among BTSC, I and VTVT.
But I did not capitalize on these opportunities. Therefore, I will have to make a plan about what to change to become more decisive in these kinds of situations, be it having a smaller position size or having tighter stops. I will definitely make a plan for this major impediment.