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Spoiler, it's always short squeeze season, you just need to know where to look, and how to participate!
This week the MEME stocks were back in favor for a headline or two this week, and of course all of Twitter and financial news outlets were all over the hype, for a one day move, out of no where moving from 165 to over 220 in a day.
A quick reminder that we will be raising the price of the Trading Lab on September 1st (next Wednesday!) to $397. If you want to lock in your $297 price FOREVER, get signed up now before Wednesday.
There is a lot of mysticism about the short squeeze stocks, why do they happen, what causes them, who's the big evil hedge fund who is shorting them or the do-gooder that is shorting them because they do business slightly different than the way it use to be done in 1955.
To be honest, I had no quantitative edge this time around with $GME and $AMC.
Meanwhile in the Trading Lab we have a systematic approach to trading these strategies, and it's the same strategy I learned during the fall of 1999, on my first trading desk.
I knew this strategy and always kept it in my back pocket, but never really thought about using it until earlier this year when the whole GameStop ($GME) and AMC Theaters ($AMC) meme stock frenzy was happening.
The thing is, I never gave it any real serious consideration before.
But when I saw what happened with $GME, I wanted to take a legitimate look at how to apply quantitative trading methods to this strategy.
First I wanted to identify that there was indeed an edge here, that's the most important step, if there isn't an edge to begin with, then there's no point in proceeding to step two.
There is a clear edge when the amount of short interest is high enough and the price action pulls you into a trade, you catch a momentum MACHINE.
Once the price goes above certain price levels, the shorts are forced to cover, either using their own risk management rules, or by their broker who issues a margin call. Either way, bear tears fuel this type of rally...my favorite type of rally.
Let's have a look at some big winners this week.
$BBIG Vinco Ventures was a big winner for us this week in the Trading Lab, we got in Wednesday at $3.28 and at the moment of this writing, it's trading at $7.34.
Another face ripper was $SPRT Support.com getting in around $11 and that one shot all the way up to nearly $60 today!
$NURO NeuroMetrix, inc is another one we are currently in.
$AHPI Allied Healthcare Producs Inc, is one we traded a few weeks ago in the Lab getting in around 10 and out before topping at 16.
$WORX was another short squeeze a few weeks back, getting in under 3 and out before topping near 5.
They don't all work out, the win rate is above 70%, and when they do work out you can catch monster runs. Or if they lose, you stop out, losing a couple of bucks, like this one, $PUBM PubMatic, Inc. getting in at 32 and stopping out at 28.
Short Squeezes happen all year long, not just when Reddit groups conspire together and have a little one day rally that gets all sorts of headlines, and the gamblers out there chase it in hopes of a triple digit single day move.
We prefer to line up our shot, play it out week by week, month by month, when our edge is present.
Most winning trades are at least 2R, but often times they are 100%, 200% even 500% gains in a matter of days.
What I love most about this strategy is that it takes about 2 minutes to implement once we get the signal, just place the orders to buy, stop loss and profit target.
Here was the $BBIG Notification to our Trading Lab members earlier this week
****** SHORT SQUEEZE ALERT ******
BUY $BBIG WITH A BUY STOP ABOVE 3.27
STOP LOSS ON DAILY CLOSE BELOW
2.17 PROFIT TARGET $5.47 (2R) Wait for price to trigger at 3.28, do not front run as the breakout is the trigger
The edge in this trading strategy doesn't require you to dig into the deep dark corners of Reddit, to make big winners. YOU ARE WELCOME, for that :)
The Short Squeeze strategy is just one of the strategies that we offer all together in the Trading Lab
In addition you'll get access to:
Monthly Macro ETF Strategy - you'll get an email before the first trading day of the month of any buys or sells of US Macro ETFs, it literally takes 5 minutes to run this strategy each month.
Short Squeeze and End of Month Equity Strategy - you'll get an email with entry price/stop loss price/profit target for a stock that is potentially about to run 20%, 30% even 100+% in a given day, think $GME or $AMC. On top of that, we've built a strategy that buys an Index at the end of each month which the past 12 months has had a 90+% win rate! And to juice even more profit out of the strategy, follow along in the Slack Channel to see when we exit it for the most profits!
Forex Swing Strategy - If you are a swing trader Forex markets offer a great opportunity to swing trade just 15 minutes per day, with clear entry and exit parameters. This is a mean reversion killer, that is like earning a monthly salary! Every evening that there is a trade on, you'll get an email alert letting you know the parameters.
Futures Swing Strategy - If you've been following along the $NQ trade the past year and a half with me, then you see how powerful this strategy is. By far this is the most profitable strategy we run, taking advantage of multiple market edges, catching the biggest market moves and stepping out of the way when trouble ensues. We keep you updated not just in our free newsletters, but as a member of the Lab you get the day to day access to see how we are actually crushing this market, with emails clearly describing the entries, adds, stops and when to step away.
Crypto Swing Strategy - Since September 2020 our swing strategy is up over 1100%, while our core holdings suffered a bit of a drawdown in the May 2021 selloff, our swing strategy exited all positions and went to cash. You can choose how risky and aggressive you want to be, in between the big moves. The number one feature isn't the weekly alt coin swing trades that average 10% per week, but rather when the top is in, and when it's time to sell all crypto and walk away! Emails will be sent out as the market evolves.
Day Trading Live Stream - And this is what todays email showcased, how we day trade the futures and currency markets. This is broadcast live on Zoom where you can ask questions directly to me, share insights with other traders and take your trading game up a few levels quickly.
Finally the Slack group is 24/7, with traders all around the world always accessible to bounce ideas off of, ask questions to, and well, trading is a lonely business so it's incredible to have a crew to collaborate with.
We will be increasing the price of the Trading Lab September 1st to $397, but you can lock in $297 FOREVER buy signing up before September.
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