Thursday, October 4, 2012

10/05/12 Friday Watchlist [with follow-up]

ZNGA (Short-biased)

ZNGA- Dropping because of poor outlook. This type of news could cause it to keep dropping. The best way to play this imo is to short the first or second rebound attempt. In the chart you can see that its based at 2.2 but slipped under it on the second test (this is usually a fakeout to lure in shorts to be squeezed so that the stock spikes into a rebound as aggressive short sellers buy to cover their positions). So look for tops as it spikes and be prepared to short. Remember the bigger the time-scale in which you find a top, the bigger the drop so look for top patterns on 5min & 15min candles to make the trade worth your time.

ZNGA moved as predicted. These bounces are always potential buys if you know how to play them, but of course you must remain short-biased. It had some breakout volume eod, so just be patient and wait for a squeeze (i.e. bounces near or above its highs with fading volume) and then look for the top next week.

ROSG (Long-biased)

ROSG- I was alerting everybody on this over and over again yesterday. I bought at 6.0 yesterday on the big dip and then bought more at 5.75 to avg down to 5.88 and sold some at 5.94 for profits. ROSG has had a few good news but mm decided to do a massive shakeout before the inevitable spike. This low float stock is one of the most subtle but predictable stocks. It repeats the same patterns. I predicted this shakeout down to 5.75 because that's what it likes to do before a spike (amateur/aggressive short seller short during shakeout only to get squeezed which shoots the stock up nicely). An additional news tomorrow would be nice. I will add when 6.25 breakouts. But let me add that this shakeout could be more massive and drop to 5.25 again, so be prepared to sell quick for breakeven/profits and buy at cheaper price. So always keep eye on price action and the trick is to look for tops to get out or to buy into a short squeeze. 

ROSG didn't do much but consolidate and hold its position. This price action is still a good set-up for a monday morning dip (below 5.75 to lure in aggressive shorts) and spike.

SRPT (Short-biased)

SRPT- Probably the most over-extended stock in the market right now, having jumped 200% in one day. That is crazy for such an expensive stock. But I love this pattern. Turning into a triple top. I played this many times on both sides (mostly shorting tho) with my best short being 43.5 and covering 39.6. I was also able to short into the close at 37.45. Not easy to find shares to short so you gotta be prepared. It could spike alil to test 38.5, should fail and panic nicely, if not it will try to squeeze but wont get far esp without another big time news. I will add to my short on any spike if I can find more borrows. Extremely volatile with big spreads like ROSG so be careful and be PREPARED. And short small positions.

SRPT gapped down and morning panicked to 34s. This is what I was looking for and why I shorted end of day the day before at 37.5 and covered at 34.6 for a quick $300 profit. It ended weak and may gap down again. A reshort on any spike/gap-up towards (but under) key res at 36.25.

SNSS (Short-biased)

SNSS- The short squeeze has begun. Now is the time to look to short. NEVER short randomly. Always look for the  top pattern. It should top at 6.5 (key res, daily) but could also top at natural res 6.0 or 6.25 if its weak. So look for the top at any of those res levels.

SNSS squeezing nicely. This is the kind of squeeze i like to buy but will just play it on the short side this time. It looks like it may be topping at key res 6.5 so look for the pattern and be prepared to short.

NTE (Short-biased)

NTE- May be one of the most painful stocks to short right now while its above 10. Obviously this stock has alot of support (multiyear, trendline, and natural supports) above 10, hence why its so choppy above 10. I like to short early as shares are always hard for me to find for perfect set-ups but feel free to wait for 10.5 or 10. NTE has been squeezing for 3 weeks and testing at 11 just under key res 11.2.  Im still short 10.99 from 3 days ago but because it likes to double top, you may have a second chance at getting in at 11 as it bounces to form a double top. We should see below 10 in a week or 2. I covered half at 10.85 so i will double up again at 11 and just sit on this for couple weeks.

NTE Friday squeezed today. I covered 11.11 fromm 10.99 as I cut my losses. You never know when a squeeze will lead to a breakout so I don't gamble it. I shoulda coulda woulda shorted again just under 11 but was stuck watching other trades. Still a reshort under 11 on any spike or gap-up.

BBDA (dead pump rebound play)

BBDA- A dead pump rebound play with 100%+ potential. This stock had a pretty big news back on June 14 when CEO said they no longer need to rely on selling shares to raise money because they are expecting revenue growth. Of course newsletters and spam mailers jumped on this and caused it to spike 4000% in less than 3months, making it EXTREMELY over-extended (someday I will be able to afford to short sell stocks like these as they are hard to find borrows for). So now its tanking until it finds its bottom. It should bottom at no lower than 0.0025. It should fakeout (to lure in aggressive shorts) and drop lower so wait for confirmation when it squeezes to break thru 0.0025. I don't trust any OTC so don't plan on holding your shares for long; jump in and jump out at your target or when it tops. Good luck. 

BBDA has support at 0.006. No play until it bottoms near/under 0.003.

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