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By dacuco
Oh boy…it’s that time of the year when I start thinking that I might never again find a moment that hasn’t already been spoken for to peck out a few words for the blog. For anyone that might be under the illusion that I am some millionaire stock mogul who sits in front of my laptop on a Mexican beach sipping on a cocktail with a little umbrella in it and a sun drenched, barely clad beauty in a bikini at my side…well that’s true, minus the millionaire part and oh yeah, that’s only for a couple of long weekends a year and the aforementioned beauty is my wife of 25 yrs. Well you get the point!
I work most days in a swimming pool service and repair company that I have owned for the last 16 years and let me tell you water in a 105 degree desert this time of year is verrrry popular. It’s just that brain cells are at a premium to the man who roasts them in that kind of heat everyday. LOL! So I haven’t been avoiding you I’ve just been incredibly busy. Enough said.
The bottom line is my TAM account is stuck. Until one of these little gems decides to run a bit I am going to hold on to them. My thought at this point is, that since I have fallen a bit behind the weekly chart I need one of these little penny monsters to take off and deliver 50 to a 100% kick to get my game back on track and I am confident that they will. I could sell and move on but please…don’t get me started on that lack of time thing again OK.
On a bright note I have been killing it with my newest system for qualifying picks. You really should stop by the TAM chat and check out some of the calls. Just about all are posted in advance and many are delivering great gains. Now calling big runners is not necessarily my goal, and I am usually not a day trader, matter of fact I usually bail out well in advance of any of the huge run ups completely satisfied with somewhere around 30% Although it felt great today to pull off 72% gain with CNB this morning before running out the door. And it was kinda cool that about ten minutes before that, that I grabbed a 55% pop on HAYZ. Sadly I didn’t buy any EGT but I did alert it and pick it for the TAM weekly pick and according to my screener it ended the day up 169% YIKES! lol! My LEE alert turned out to be knockout pick for TAM last week and even BKUNA delivered the prize, though it was a little smaller than anticipated…but hey what the hell I’ll take 10%, after all isn’t that what the TAM game is all about!
So, long story short TAM game stalled a little but pickin winners like a madman right now and lovin it!!! Hope to see you soon, so until we meet again, as always…
Knock em dead and let’s get that million just so we can say we did.
dacuco
By dacuco
Quite possibly the single most important thing you will discover about yourself and trading is which of these you are and what your trade tolerance is for each.
Investor/Speculator - An investor is an individual who commits money to investment products with the expectation of financial return. Generally, the primary concern of an investor is to minimize risk while maximizing return, as opposed to a speculator, who is willing to accept a higher level of risk in the hopes of collecting higher-than-average profits.
dacuco’s penny definition - When two people get married they generally will, in a very serious manner, weigh the long term benefits and consequences of the relationship…companionship with someone they love, great sex for a lifetime (OK, I know - work with me here! lol) solid financial possibilities, two loving, caring and giving individuals sharing in the responsibility of raising beautiful, successful and well balanced children, etc. etc. Now of course relationships like investments can fail but the time given and energy spent in the process of courting and choosing this mate should be taken very seriously so as to eliminate as much of the risk of failure as possible. This is the investor!
dacuco’s penny definition - The speculator is more like the guy who watches girls all night at a bar, paying special attention to the ones that are drinking tequila shots, laughing louder, smiling more, dancing more erratically as the night goes on and rarely with the same guy but somehow remaining steady enough to stay on her feet. Meanwhile two martinis later he’s viewing the world through martini lenses and noticing just how much more beautiful all the women have become. Well with this kind of solid research, sometimes it all works out and manifests the story and experience of a lifetime, and at other times…well you know, he may get something else that demands the immediate attention of a doctor. So is the life of the speculator… higher risk for potentially greater rewards!
The point very simply, in my opinion is, that you CAN’T research, pick or play a penny stock like a big board stock.
The investor may want instant gratification but will generally be equally pleased with the slower and more steady growth of their porfolio along with the comfort and safety of a solid pick and trade. The speculator on the other hand wants his gratification now and is at times willing to sacrifice caution and sanity for possibility!
If we can find were we fit in the scheme of investor/speculator then we can determine how we trade.
The big board investor generally doesn’t and shouldn’t expect his due diligence on a stock pick to produce a 35% run in a short period of time, though certainly it can. The speculator in contrast, shouldn’t expect his pick to continue to produce profits more than a day or two and in many cases far less than that, more like an hour or two. So were do you fit?
A Few Tips For Trading Pennies:
#1 - For anyone that follows me I hope you have noticed I like the middle. Enough time given to research penny stock to eliminate some risk but not so much as to paralyze myself with fear. Analysis paralysis will rob you of opportunities and can take you to a place were no trade is safe enough so therefore no trade!
#2 - I don’t chase runners (you can usually find a place to take your profit and then buy back in on dips or try selling a portion to recover your initial investment and hold the rest to see if continues up)
#3 - I am always satisfied with 20 to 30% profit on a penny stock even if it continues up well beyond that. I try to always remember that in penny stocks no loss is a win!
#4 - Though not always possible I try not to hold (now in the TAM game playing with limited funds at this point it will not always be possible to get in and out that fast) but the principle is sound. I find it amazing when newbs tell me they didn’t sell for 50% profit on a penny stock because they wanted more or just weren’t paying attention. YIKES!
#5 - I’m generally not trying to find the next Microsoft in a penny stock (There are far safer plays for that above $5.00 a share) but I do accumulate some left over penny stock with the realization and expectation that most or all of these “companies” will be valueless or won’t even be around in a short time.
#6 - If I am stuck in a stock too high, that generally means I’m watching it very closely. If I notice that even though it has dropped significantly it has begun to trade in a channel, I may buy and sell that same stock several times at the lower prices as it bounces up and down in retracement inside that channel. Then the the shares that were purchased too high are averaged in and are generally no longer of issue.
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OK…That’s enough for now. I think it’s time for a martini so feel free to raise a glass with me and if you should have any comments you’d like to share, nows the time to post them…because you know I’d love to read them through these martini lenses.
Cheers to all and I hope that you’ll find that comfortable place where you belong, that winning place that exists somewhere between the realm of Investor/Speculator… and that when you do, it affords you great and sustainable success!
So until next time!
Knock em dead!
dacuco
By dacuco
OK quickly, before we start … not a lot to report on the progress of TAM for this week. I currently own and am stuck in three stocks over the weekend. Included in this illustrious line up are CNVC, BBDA and PGYC. Yikes! Scary! But to the ”BALLS OF STEEL” penny trader, these three are loaded with just the right kind exhilarating possibilities that make this TAM game and penny trading in general great fun and potentially very lucrative. Each of these can fall flat on their rear end or double or triple in value at any time. I know we’re only looking for 10% per trade but it’s hard when you know and have participated in a stock like CNVC that has dipped and doubled at least three times in the last 30 days. So hold, I will. Succeed, we’ll see…need to make up some ground.
Now with tongue firmly planted in cheek, let me go over a few penny trading terms and their definitions that I hope all penny traders will find of value.
Caveat Emptor - Latin for “Let the buyer beware”
dacuco’s penny definition - The 23 yr. old president of the company went to a strip club on commingled funds, passed some inside information to a topless cocktail waitress, forgot how to get home and left the disclosure documents that would allow the company to become compliant with the OTC Pinksheet market in her car, but that’s ok because the company doesn’t really own anything to disclose anyway and he’s going to be too hung over to do it in the morning, so the hell with it lets just release a company PR and run the stock price up a penny.
Spread - The difference between the bid price and the ask price.
dacuco’s penny definition - This is much like the crash instructions you might receive on an airplane. You can buy the stock at the higher ask price and sell it one second later for the lesser bid price, then have the extra indulgence of paying a commission on top of that. So basically sit down, spread your legs insert your head between your knees and kiss your ass goodbye unless you pick the right play.
Weeeeeeeeeeeeeeeeee - Commonly used in chat rooms or message boards to express jubilence during a successful trade, when the issue being traded has a significant and ongoing increase in price per share.
dacuco’s penny definition - This is a code used to signal all new investor/traders that the stock has run up way to high already and that you should call all of your friends and relatives and buy in right now at the very top, so that all of the traders who know better will have someone to dump all of their over inflated stock shares on.
Last but not least, that’s right you guessed it…what it else could it be! LOL!
Pump & Dump - This is a penny stock trading strategy where the prices of the penny stocks usually rise very quickly because of hype, and then falls dramatically when the pumpers unload their stocks at the inflated price.
dacuco’s penny definition - This is simply the eye and lip tremors you experience along with heart palpitations and excessive sweating, as well as a severe case of irritable bowel syndrome when you realize (though not exclusive to - this mostly happens to college students) that you have to call your parents because you just lost the entire amount of this semesters tuition.
So there you have it the first installment of “dacuco’s penny definitions for the penny trader”. I hope you enjoyed it and that through the humor you might have grasped the important underlying truths that could help save or make you a couple of extra bucks on your next trade.
Hope you’ll check back again…so until the next time.
Knock em dead!
dacuco
By dacuco
I find the differences between trading pennies and big board stocks more & more staggering with each passing day. There is a definite demeanor or cult of personality that comes into play when someone trades one or the other of these types of stocks. The big board player looks upon the penny player befuddled and bewildered by the fact that anyone could choose to play a company with such weak financials and total lack of fundamentals or technicals from which to base a trade. They watch each trade quitely, mostly with indifference and from a safe hands off distance. They are certainly entertained and are mostly polite in their comments but the underlying current of disdain for this silliness can at times be somewhat palatable. After all this isn’t trading, it’s much more like gambling!
On the other end of the spectrum you have the penny trader who has a tendency to get bored very quickly, gazing blurry eyed at the computer screen while an extended conversation ensues about the solvency or liquidity reported in a companies earnings statement. As Mr. Penny observes a trade or the preliminary research on that trade for a big board stock he quickly is assured that there would be no further need for valium in the world if he could just introduce this process to those in need of the drug.
We Don’t Trade Companies We Trade Tickers!
The penny picker can reel off tickers a mile a minute but notice the hesitation when you ask them the name of the company. LOL! Hell, many of the times I’ve had successful trades I didn’t even know what the company did! Well that’s why I’m standing up to take a stand for all you crazy, gambling, penny pushing fools and try to briefly explain why we find this, as fascinating a technique of trading as any other.
You see what is hard for the person of a keenly analytical background to understand about the penny trader is, knowing that a company is broke, has no employees, a small work space with limited equipment and a PO box somewhere in Las Vegas, how can you take that risk. How can you believe that a successful outcome is possible more times than not. It doesn’t make sense and it has to be gambling!
The Psychology of the Trade
I won’t spend a lot of time to explain the way we check charts for indicators and patterns that might signal an upward trend or how we discern the potential impact of news and volume in that selection process. All of that could possibly be for another post. Instead I would just like to say that it has been my observation of the many penny traders I have known, that there appears to be a dominate single link that binds us all together. We see ourselves as dedicated specialists in the art of the psychology of the market, sharing an ability that calls into use areas of human experience and psyche that signals to us why, when and what we should buy. Then it triggers inside us again…indicating when the correct time arrives to successfully exit or re-enter a particular trade in a way that will be beneficial to the positive outcome of that trade. We realize that it is usually the new, the late comers or the ill prepared that will ultimately get stuck at the top of a penny trade, and lord knows we’ve all spent our share of time in that unpleasant position, but that it is certainly the price we all must pay for our education. We want everyone to profit and no one to be hurt but as a benefit of the afore mentioned education, just maybe the penny trader has developed a greater sense of survival which in turn helps us determine when to get in and out of a trade.
So is it possible that we could have much to learn from, and too teach to one another? Just think what a powerful tool the accumulation and implementaion of the big board technicians expertise joined together with the penny players knowledge and awareness of the psychology of the market could be, on the journey to our mutual goal of increased wealth. Well guess what…that is exactly what TAM has been for me. The marriage of these two very different trading techniques into a killer TAM system and group that is available to be used by all!
I hope that you might glean something of value as you trade along side me and that you will accept my sincere thanks for all I have learned from you!
So lets knock em dead!
dacuco
By dacuco
Happy Easter, Happy Passover, Happy just another day to the secular humanists and Happy whatever to all the rest!
No stock based blog post from me today but I’d like to send out a “Job Well Done” to Orion on his latest post. The content and time that he contributes shows exactly why I believe the TAM consortium is one the best stock based groups that one can participate with. In my opinion the knowledge and diversity, and the willingness to share it places this group a cut above the rest! Thank you for being a part of it and if you haven’t yet, come visit us in the chat and you will see exactly what I mean.
Have a blessed day!
Knock em dead on Monday
dacuco
