this week's lesson.
Today we will discuss some previous tickers that lead to a profitable July back in 2018.
Now, July kicks off the start to a hot season in the stock market, and we can see that compared to numbers back in 2016 and on. July, August, and September always have a good come back after suffering through a slow summer and these three months lead right into an even hotter year-end. When we get into October, November, and December, we see supernovas and big plays around the holidays that make for the three most challenging months to trade.
Throughout July in 2018, I made a gross profit of $160,000. Most of those trades were small gains and all patterns such as bounce short, gap-up short, and the first red day. However, I made only a few big trades, and I want to get into those. $VISL is one of those trades and was a classic, low-float pump that went from $1 to $8. I shorted into the consolidation breakdown at $6.50 and should’ve held overnight but sometimes taking on those borrowing fees don’t seem worth it. The next day, $VISL made an offering, but that was unpredictable, and I let go.
Moving on to $CEI, we see another low-float that I took a partial portion on at $5.40 when it was around $9 going into the spike. This ticker didn’t present a pattern that could be traded because the intraday chart showed no resistance. When you have a stock showing a gap up, weak opening, mid-day perk pattern, and then break at $5 to go to $9, then you don’t see a consolidation resistance, and it’s all parabolic. Without that consolidation area to short into, you’re at a huge risk when using overstaying gap-down into that $6 area.
Before continuing with $EVER, which has a low volume of around 2 million, I want to talk about market cap and the specific categories within the different market cap zones. Penny stocks start around 10 to 100 million, mid-caps come in around 100 to 500 million, and large caps near 1 billion or more. When using volume prediction during the pre-market, we typically don’t see anything trading under 10 million because, by mid-day, a stock will have at least traded 7 million or more. Because that’s not the case with $EVER, you’re looking at low liquidity and a big market cap, which means you’ll be faced with a large spread.