Short Sellers Didn't See This Coming...

What's up everyone? Welcome to day seven of my 
brand new small account challenge of growing a   $2,000 account using Charles Schwab as my broker. 
Today is a green day. Now, if you've been tuning   in to this series, you may know that yesterday, 
day six, was a red day. But fortunately,   between yesterday, day six, and today, we had 
a weekend. So, today's Monday morning. This   was an opportunity for me to kind of reset over 
the weekend, bring the emotions down a little   bit and come back here Monday morning refreshed. 
And so for me, oftent times the day after a red   day can be a fork in the road. I could do one of 
two things. I can either come back swinging hard,   revenge trading, really frustrated, and have a 
second red day in a row. And usually when that   happens, the second red day is even bigger than 
the first because I'm taking bigger positions to   try to make back all of the previous day's loss 
very quickly. But if the market's not strong,   I end up with a second big red day. It could 
even go on for three, four, five, six red days   in a row. I mean, you never know. If you don't 
want to stop, you just keep coming back with that   same mentality of I'm just going to make back the 
loss. You get stubborn. When you trade like that,   you end up losing a lot of money. And so the 
weekend was helpful. It was an opportunity to   kind of put some space between me and that red day 
and come back this morning and be patient. And so   when I sat down this morning, I reminded myself 
that, you know what, even though I had a red day   on day six, I've still made a lot of progress in 
this challenge. And the best way for me to get   back on track is to go back to focusing on the 
best quality setups. Because if you recall from   day six, one of the issues was that I was trading 
a stock that didn't meet all five pillars of stock   selection. The price was too low. It just wasn't 
quite right. So today, things turned around in a   pretty big way. We had a stock that squeezed up 
over 250%. Now, this one was kind of interesting   because the stock has popped up a couple times 
in the last few trading sessions, popped up   and reversed, popped up and reversed. Today was 
different. It popped up. It held. It trapped early   short sellers and then it squeezed as they got 
forced to cover. And so as we jump into the recap,   this will be an interesting discussion about 
what was different today that allowed the   stock to continue moving higher instead of reject 
like it had the previous trading sessions. Okay,   so as you guys know, all of the profit from these 
small account challenges gets donated to charity.   And every time you guys hit the thumbs up, you 
help add an extra dollar to how much I donate. So,   as of right now, we've raised over $321,000 for 
charity. This is my fourth small account challenge   here in this series of trading with a $2,000 
account. Now, these are the different charities   that we've donated to, and I've donated a total 
of $319,500 so far. So, I'm waiting till we get   to the next $5,000 increment to do the next uh 
donation. All right, so day seven. This morning,   um, we had a stock that popped up on the scanner, 
as you can see right here. And the ticker is   NXTs. Price did $9.21 in this, um, when I grabbed 
this screenshot. The float is less than 1 million   shares. We've got, uh, a percentage gain of 81%. 
Now, at this moment, we had a couple other stocks   that were up more. This was not the number one 
leading gainer. We had Getty, which was up 128%.   We had TN which was up 67 or sorry uh 90% 67 
cent stock though a little too cheap. We had   SGT up 58%. We had NXTs here at about 57%. It sort 
of dipped down when I grabbed the screenshot and   then it kind of rallied back up. So at this 
point it wasn't the leading gainer. Now what   you may know is that I really like trading a stock 
that is the leading gainer in the market because   that makes me feel that it is the most obvious 
that everyone's going to be looking at it. So   when a stock is the fifth or sixth or seventh 
leading gainer, kind of down lower on the scan,   I feel that it's not as obvious. Now today, this 
is a challenge because Getty was already up 128%.   So in order for something to be more obvious, 
it had to be up in theory more than 128%.   So, if I pull up um a chart here, we're just 
going to look uh briefly at a couple of the   other stocks that were leading um the way and then 
we'll get into uh my trade on NXTs. So, Getty,   oops, get TY. Um this one had popped up at about 
4 in the morning. There was some news out on it,   but then after that initial pop, it just kind 
of started stairstepping down. So, this really   never presented an opportunity for a trade unless 
you were sitting down at 4 in the morning. So,   although it was the leading gainer, I think 
if anyone pulled it up, they would say, "This   isn't really that obvious. I probably shouldn't be 
trading this." So, although again, leading gainer,   easy to dismiss that as not being the one that 
people would focus on. TN second leading gainer.   Now, this one had made a big move in after 
hours um in the previous session last week   and then popped up a little bit at 4:00 a.m. and 
then sold off. So, for most of pre-market, I think   it was fair to say that this was also not super 
obvious as it was trading in this area below this   orange line, which is the volume weighted average 
price. When a stock is below the volume weighted   average price, it's inherently bearish. above it 
is bullish and trade most of the morning below it   until at 8 a.m. it got above it then back below 
it and then back above it here just after the   opening bell. So it's possible that TN did take a 
little bit of attention uh because there were some   moments where it was a bit more bullish. The next 
one down was SGT up 58% squeezed up in after hours   trading in the last session moved higher at 4 
a.m. and then started just stairstepping down. So,   because that was stairstepping down, this one 
was no good for all of pre-market. And so, I sat   here during the pre-market session just patiently 
waiting to see if anything would hit our scanners   that looked good. And so, I'm using my small cap 
highay momentum scanner right here. And what this   is doing is it's searching the entire market in 
real time for stocks that meet my five pillars   of stock selection. Now, it casts a little bit 
of a wider net and then it gives me a chance to   um sort of do a discretionary analysis of deciding 
which one is uh really worth consideration. So,   at about 8:25 a.m. NXTs hits our scanner. So, 
NXTs hits the scanner and I'll pull up my other   um chart here to show this to you. So, when NXTs 
first hits my scanner, you can see this is the   move from $45 a share all the way up to just under 
20 bucks. It's phenomenal. When it first hit my   scanner, I pulled it up and I see, okay, this is a 
um they've they've got an AI um you know, kind of   um mitochondrial drug discovery headline. So, 
seems like you know, a biotech type of stock.   um the sector says materials and agriculture, 
but that doesn't really uh ring true with um   what we're hearing, what we're seeing in these 
headlines. So, when this first pop pops up,   I look at the chart. I've got it on full screen 
like this. And I noticed that in the last couple   days here, these two days, it had um you 
know, some volume. Now, this is something   I noticed. When a stock recently has had almost 
no volume and then today has a ton of volume,   it creates a greater imbalance between supply and 
demand. The relative volume ratio is higher. And   the relative volume measures the volume today 
versus a typical day. And so when I saw that,   I remembered actually that yes, this stock had 
popped up a couple times in the previous trading   sessions. And look at this. This is a day where it 
popped from 7 all the way up to 12 and drops down,   ends up red on the day. Another day here, 
goes from 5 to 9 all the way back to five. So,   when it first popped up, I was thinking, well, can 
we can we really trust it? Um, and then I thought,   what was different about those days? And one of 
the things that was different about these two   days is that we had a lot of other stocks popping 
up on those days. And so this stock was fighting   for attention with a lot of other stocks that were 
moving. Today, there really wasn't anything else   moving at the time that this popped up and I 
think that was really to its advantage. Now,   it did have a a headline that came out, so it 
had breaking news, which is good. And when it   first popped up right here, I let it pop up. It 
goes up to, you know, from 480 to 5. Little micro   pullback here from six, goes up to 680, then goes 
up to a high of 740. It dips down and I took my   first trade on this little pullback right there. 
So, that was my first entry. It ends up squeezing   up to eight. I take my profit off the table as 
it pushes higher. It dips down again. It goes   higher. I kind of regretting selling, but I'm 
glad that I made money on it. It then goes down   and it goes below the volume weight average price, 
that important trend line. And then it comes back   above it right here. And as it swings back above 
it, we go right back to this high of nine. Now,   I didn't feel quite confident enough to punch it 
right there because of the previous rejection on   the other days where it just kept going lower. 
But once it started to base out here, I started to   buy right as it would break back over VWAP. And I 
was looking for the squeeze through the high. So,   I took one trade here, green, second trade here, 
green, and my third trade here was red. So, now   I've taken a total of three trades on the stock. 
All right. So the three trades down here, down   here, and right in here. And this one resulted 
in being red. So after those three trades,   I was green, but I was thinking, you know, maybe 
I should take my foot off the gas. At that point,   I was up about I think it was $600. So I'd made 
a little bit of profit. And then on on the loss,   it was not a big loss, maybe $50 loss, which is 
fine, but I thought maybe this is, you know, as   good as it's going to get. And then it pulls back 
again. It breaks below VWAP a second time or it in   more kind of earnest it really is below it. Then 
it comes back up here and it rips all the way back   up to 950. Now I had previously said I thought we 
would see resistance at around $ 939. So why did   I say $9.39? Well, if we look at this chart right 
here and we look at this previous high back here,   I had my I Well, looks like I clicked it a little 
bit off. So, the high there was actually 9:45. U   So, 9:45 was I I quickly drew a line there, and 
it looks like I didn't snap it to the top of that   candle. So, I said 939, but it should have been 
945. That was the correct spot to the penny. So,   945 was the high here. And then I said, if we can 
break that level, we've got room up to the high of   this candle wick, which is 1075. And then we've 
got room up to the high of this candle, which is   11 or sorry, $12 a share. And then above that, we 
have no resistance. So, if we can get above any,   at least not any nearby. So, if we can get above 
12, we're in great shape. Now, during pre-market,   we end up uh trading in this kind of area right 
here. So, we dip back down. And I'm just going to   switch this to um the one minute time frame just 
to make it easy. So, switch to the one minute. So,   we end up breaking um back over 950 right here. 
And this is where I took my fourth trade. And   it squeezes up to 11, which was an awesome trade. 
Although, because it's more expensive, I couldn't   afford very many shares. And so the total profit 
that I made on it was somewhat limited. But at   that point, it put me up a little over $1,000. 
Ends up dipping down, coming back up. I took a   few more trades in this area in my main account, 
but not in the small account because I didn't feel   that I could really manage my risk. Then at 
the open, we squeeze through this pre-market   high right here. We break 12. We go up to that 
high, we do a micro pullback, and we squeeze up.   We halt for five minutes on a volatility circuit 
breaker halt. We then resume. We go into a second   halt. Then we resume, we go up to almost a 
third halt. We dip back down to 15. We rally   back up to 1950. And now we're sort of sitting 
right here in between this range. An amazing   move. Some really strong momentum on this one. 
Now, typically I'll say that when I'm trading,   I look for uh and this is a this is the one minute 
chart, but if we look at the five-minute chart,   and I was paying attention to the five-minute 
chart on this because it was giving me some   oops, sorry, got to switch the time frame 
here. It was giving us some nice signals.   So typically I expect a nice pullback on the first 
and second pullback. So this is our first pullback   right here and this is our second pullback. And I 
was a little disappointed that the breakout on the   second pullback here was smaller than the breakout 
on the first pullback. Sometimes when you see that   happen that the breakouts are getting smaller and 
smaller and smaller and smaller eventually they   just roll over. So, it was unexpected that this 
third breakout was so strong from 10 all the way   up to nearly $20 a share. An incredible move. But 
I think it speaks to the fact that short sellers   got stuck on this one because they had a bias 
based on the last couple trading sessions. But one   of the things that can be confusing is that while 
the underlying catalyst on this stock may not have   been significantly stronger than the headlines 
on the previous day, today this was the most   obvious stock in the market. And being the most 
obvious stock in the market is what allowed it to   gain this amount of volume and continue squeezing 
higher and now be up over 250% on the day. So some   really phenomenal price action on this one. Again, 
my total positions were around 400 500 shares. So,   I wasn't really able to take big size on this. I 
mean, I actually could have taken bigger size, but   slightly bigger, but not that much bigger. Um, so 
in total, we end up getting this phenomenal move,   and I'm up $1,3724, putting my account now just 
over $8,000 in total equity. I started with 2,000,   which means I've made $6,000 of profit. The 
account's up 300% here in 7 days. 14 trades,   11 winners, three losers, 78% accuracy, 
and average winning trade or average uh   gain per trade is $430.38. Now, if you had 
joined our twoe trial a couple weeks ago,   you would have been able to watch all of this 
live in real time, seeing my positions window,   seeing as I'm getting in, as I'm getting out. 
And so, if you haven't already, make sure you   check out the twoe trial with a link posted in the 
top of the description and pinned to the top of   the comments. I'll remind you guys as always that 
trading is risky. My results aren't typical. So,   please manage your risk, take it slow, and 
always practice in a simulator before putting   real money on the line. I will see you guys for 
day eight streaming at 7 a.m. tomorrow morning.