Another Chinese No News Short Squeeze!

AI Summary

Transcript

What's up, everyone? Welcome to day 24
of my small account challenge of growing
a $2,000 account using Charles Schwab as
my broker. Today's another green day and
I guess you could probably say it's day
four of this China frenzy. This week
we've had multiple Chinese stocks that
have squeezed up over 1,000% with no
news. It's pretty insane. So, this is a
frothy market. Traders are exuberant.
They're jumping in anything that's
moving. Shorts are getting run over and
we're getting these you know, sort of
disproportionate moves relative to any
true fundamental catalyst.
All right. Well, it's a time, I suppose,
to capitalize on the volatility but to
try to manage risk. And so, today we had
a couple stocks that moved but I didn't
feel comfortable trading them in the
small account cuz I just I wasn't sure I
could position quite right to get in and
get out quickly. And so, I waited. I
waited and waited until we had one setup
that I really liked and then I stepped
up to the plate on it. So, we're going
to go ahead and break it down in today's
recap. As always, all of the profits
from these challenges gets donated to
charity and each time you guys hit the
thumbs up, I add an extra dollar to how
much I donate. We've now raised over
$383,000.
Hopefully, between
uh the thumbs up on today's episode and
the profit from tomorrow, day 25, we'll
have enough to donate another $5,000 to
a children's hospital. The goal is the
50 state children's hospital um
fundraising challenge to donate to a
different children's hospital in every
state in the United States. We've so far
donated $380,000 with the last donation
going to the Oklahoma Children's um
Health Hospital. All right. So, day 24.
Yesterday's big move was ZCMD. This is
important because this set the tone for
today. So, ZCMD pre-market, uh you know,
it popped up, double topped right here,
pulled back, and then it came up and it
blew through that level of 314, halted
up once, twice, three times, four times,
dropped down, halted up a fifth time,
ends up going from $2.50 all the way up
to 12 bucks.
I didn't trade it. I took zero trades on
it. And I'll be honest, I was a little
grouchy yesterday. Um
I kind of felt like, man, I just keep uh
I just keep watching these stocks make
like 700% moves without me. You know,
but it's just
it's so unusual for it to happen at
these times of the day and with the
halts and no news. I just felt like I
couldn't manage my risk. So, anyways, um
if you can't manage your risk, then
you're not really missing anything.
You're choosing not to trade it because
it's not safe. Um but it was hard to
remember that at the time. So, anyways,
so we had the big move yesterday on
ZCMD. And then what's really interesting
is that this morning, let me show you
the chart of ZCMD. This is You You won't
even believe this. So, ZCMD this
morning,
they come out with news that they just
completed a $5 million secondary
offering. So, they sold $5 million worth
of stock, and they were warrants priced
at something like a uh a dollar each.
And so, they were pretty cheap. Uh so,
the institutional investor that bought
them is in a great spot. Um so, anyways,
the stock drops here uh down to well,
about $1.50. Then it comes back up to
three, pulls back, and then it breaks
three, and goes straight to $8 in about
30 seconds.
Anyone who shorted here, thinking this
is bad news, it's going back down to a
dollar, got completely smoked. Like an
eight-to-one risk-to-reward ratio, where
you're risking eight all the way up to
$8 for one, which is the most it would
go was to zero.
So, then it drops right back down. It
comes back up, comes back up right here.
And then right here is where I jumped in
in my main account. We'll talk about
that in my main account recap. I end up
stopping out. I lost on it. It's
annoying, whatever. Didn't trade in the
small account, though. This was a little
too risky. So, then ends up going
sideways and pulling back. But, I
thought, all right, clearly people are
still paying attention to ZCMD.
And so, I remind myself, well, what was
the setup yesterday morning, right? So,
I switched to the 5-minute chart just to
zoom out a little bit and I saw this
kind of setup here. So, then I said, all
right, is there anything today that's
setting up to look similar to day one of
ZCMD? And so, I looked at the scans and
we had Weebuy. That at the time was our
leading gainer. And I said, nah, that
one already kind of broke the pre-market
high. Now, it's got this high up here.
We joked that they should name their
company WeSell
because you often have these high volume
selling days. This is not the first time
we've seen this with this stock. So, you
can see on the daily chart all these red
volume bars.
So, I already was familiar with the
ticker when it popped up and I was like,
yeah, I don't know. I don't think that's
going to work. So, Weebuy was a no-go.
LGCL,
it popped up after hours. It was already
pulling back too much. I was like, no,
that's not going to work. And then EHGO,
I saw this one and I was like, okay,
this actually looks very similar to
ZCMD. It's right underneath this
pre-market high here of about 311. And
so, let me back this up. So, we got the
scanner alert on the running up scanner
of EHGO at 287 and it was already one of
the leading gainers. I think it was in
the third position at the time I pulled
up a chart.
It's also Chinese. It's also known news.
So, it fits the current theme of what's
been working. And you know, so for that
reason I thought, you know what, I
should pay attention to this.
Oh, wrong. Those are from yesterday.
I'll just skip over them. So, it ends up
right here. I said, you know what, I
think I got to jump in this. And I
jumped in it right there.
I jumped in it in my main account. And
then I I got in a little higher in the
small account. I kind of chased in the
small account, but that's okay. So, got
in in the small account and this thing
ends up ripping all the way up to a high
of $5
a share.
I took a total of two trades on it. I
made $1,800, $1,868.92,
bringing my account up to $34,677.
Which means my account is now up about
1,600%.
So, uh $32,000 of profit, and that's all
going to charity, which is awesome. Uh
two more winners today, which uh brings
my accuracy up to about 79%, and I took
out this row at the bottom, which was my
average winners. It just kind of keeps
getting bigger, and I actually don't
think that that's a super helpful
metric. So,
uh anyway, so I took that one off, but
um this is where I sit as of day one,
and tomorrow will be day 25. It's also
the end of the week, Friday. So, we'll
see if I can finish up the week with um
another nice trade. You know, hitting
these $1,800, $2,000 kind of um winners,
you know, I mean, I guess you could say
uh you know, I mean, look, $1,000 a day
would have me on track for $250,000 a
year in the small account if I didn't uh
scale up, if I didn't increase
profitability as the account gets
bigger. With $32,000, $34,000 in the
account, I can only buy so many shares
of these stocks. They don't extend
leverage on them, but I have no longer
been trading based on buying 95% of my
total buying power because I'm not sure
that I want to jump into all these with
10,000 shares. You know, that stock with
10,000 shares like ZCMD, and it flushes
two points,
my account's gone, 66% of it in one
trade. I can't I cannot do that under
any circumstances. So,
uh so, I am, you know, tapering that
back a little bit to trading based on
fixed share size, and then adding if I
feel good, uh or not if I don't. And
that seems to be working well. So, um
that's where I'm at right now. And for
those of you guys that want to continue
watching as I grow this account, make
sure you check out the two-week trial.
Link is pinned to the top of the
comments and in the description. And if
you want your own lucky green shirt,
we've got them in every shade of the
rainbow. So, there's a link to check out
where you can get your own green shirt.
And you can use a coupon code green
shirt to get the shirt at cost for us.
So, make sure you guys check that out.
And I hope to see one of you guys one
day walking on the street wearing your
green shirt. All right. So, with that,
I'll remind you as always that trading
is risky. My results are not typical,
and there's no guarantee you'll find
success whether you trade on your own or
you learn from me. So, please manage
your risk, take it slow, and I'll see
you back at it first thing tomorrow
morning.