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It’s just crazy the volatility we are seeing lately.

And honestly, I think it’s here to stay for a while!

But don’t worry.

For penny stock trading, this can be a good thing… even a great thing.

Penny stocks love volatility. With the lower prices, their moves are more pronounced.

That is to say, you’ll see some really big percentage moves when they can get some volume behind them.

So all this means to me is that I’ll be seeing even more opportunities to take advantage of some great setups with the potential to move big.

In fact you can do it over and over again…

For an example, I’ll walk you through a number of setups my members were trading yesterday.

There was no shortage of big movers.

 

LM Funding America, Inc. (LMFA)

 

Here’s one of my classic end of day breakout setups.

Looking at the chart, you can see how LMFA was trading in a very small range each day over the past month and a half.

Friday the stock moved more than it had in any single day over that time.

Then on Monday LMFA made a big move up crossing the 20 day SMA on a volume spike, and closed near the high of the day.

The stock was showing real strength and the volume was letting us know that there was real demand coming into the stock.

This was a potential trade at the end of the day on Monday, buying into that momentum for a potential pop the next morning.

 

 

And as you can see the stock popped up big yesterday morning with a gap up to $1 and hitting a high over $1.20…

It’s not all talk in my Platinum room…

Here’s how some of my members handled it.**

 

 

Houston American Energy Corp. (HUSA)

 

HUSA presented us with a pullback after a gap up.

This is the setup I was teaching in the Platinum room last week with SPI, when that stock set up and took off.

HUSA showed us a quicker setup but it’s still the same concept.

The stock gaps up. Then pulls back in the morning giving us the potential to buy on a continuation back above the morning gap move.

 

 

And my members were on it.**

 

 

Adial Pharmaceuticals, Inc. (ADIL)

 

ADIL set up an intraday trade off yesterday’s volatility.

Looking at the chart, you can see the volume spike up in the morning as the stock price pushes up.

After which the stock pulls back and forms a symmetrical triangle during the day.

This is where we get our opportunity.

With the stock consolidating, it could break either way out of the triangle.

But with the rise on volume in the morning, the odds are in the favor of a continuation to the upside.

 

 

Waiting for the pattern to form and the breakout to occur pays off for some of my members who were able to jump on this trade as volume again spiked as the stock broke out.**

 

 

PEDEVCO Corp. (PED)

 

PED showed us something a little different with a huge spike up at the end of August, which resulted in a pull back to the 50 day SMA.

Holding above the 50 day and spiking up again in mid September, only to pull back to the 50 again.

With PED, we saw it level out at the 50 day and begin to move back up. Friday we got a close above the 200 day SMA… with continuation on Monday.

Then the gap up Yesterday, more than doubling the stock price.

 

 

And of course my members were on it.**

 

 

As you can see, volatility is here… and probably not going anywhere soon.

But it’s nothing you need to be worried about… IF you have the right strategies to take advantage of it.

It always starts with education…

 

 

 

*RagingBull does NOT track or verify subscribers’ individual trading results and these individual experiences should NOT be understood as typical as or representative. Please see our Testimonials Disclaimer here: https://ragingbull.com/disclaimer

Author: Jeff Williams

Jeff Williams is a full-time day trader with over 15 years experience. Thousands of entry-level and experienced traders alike – day-traders and swing-trade small cap stock traders – credit Jeff with guiding them to turning small accounts into big accounts.

Jeff’s "Small Account Challenge" shows people how to transform accounts from a few thousand dollars into $25k, $50k or even $100k.

Learning to Trade Stocks Is Easier Than You Think

T he intricacies of trading stocks can be confusing and intimidating, especially when you’re first starting out. The stock market has a lot of moving parts, but when you get down to the basics, it’s really pretty easy to understand. If you find yourself thinking, ‘I want to learn how to trade stocks,’ the best thing that you can do is start studying. By becoming more familiar with the types of trading, effective strategies, and lingo, you can ensure that your trades are successful and profitable.

What Is Stock Trading?

Image via Unsplash by Austin Distel

Stock trading is the practice of purchasing and selling shares, or ownership, in a publicly traded company.

Traders sell their shares in an effort to profit off of fluctuations in the stock’s price movements. Depending on the investor’s trading strategy, this capitalization can take place over the span of minutes, hours, days, months, or even years. Essentially, there are two primary types of trading:

  • Active trading: When an investor places more than 10 trades every month, it’s known as active trading. Generally, investors rely on timing the market to capitalize on market fluctuations or company events.
  • Day trading: Day trading is a bit more complex, making it a strategy best saved for those who aren’t just learning to trade stocks. Day traders buy, sell, and close all of their positions within one trading day. Most of the time, traders using this strategy care less about technical analysis than they do about current events and market movements. Their goal is to turn a profit in the extreme short term, meaning minutes or hours rather than days.

How to Learn How to Trade Stocks

Before you can learn how to trade stocks, you have to figure out how to learn how to trade stock. In other words, you need to determine effective sources and strategies to gain the information you need to learn how to trade in the stock market. Here are a few solutions to the question, ‘How can I learn to trade in the stock market?’:

Learn the Lingo

You won’t get far if you don’t have at least a basic understanding of stock market terminology. Some of the common terms you’ll hear are:

  • Analysis software: This type of software allows you to compare a stock’s performance over time, giving you a comprehensive look at the market.
  • Bonds: Bonds are a fixed-income investment where an investor allows a government or corporate entity to borrow money with interest for a specific amount of time.
  • Cost-per-stock trade: This value is based on either the size of a trade, like the number of shares, or a trade’s fixed price, such as the principal value.
  • Currency trading: This type of trading, also known as Foreign Exchange, FX, or Forex trading, is accomplished by speculating on the movements of other economies.
  • ETFs: Exchange-traded funds, or ETFs, give investors exposure to a diversified group of assets. They are traded on the stock exchange like more traditional stocks.
  • Futures trading: Futures are a contract between a buyer and a seller in which they agree on a stock’s price and the future date that the transaction will be completed.
  • Margin: These are loans from a brokerage that investors use to purchase investments. They come with an interest rate, known as a margin rate, and are quite risky.
  • Mutual funds: Mutual funds are a lot like ETFs in that they are an investment comprised of a diversified group of assets. With this type of investment, investors pool their money to invest in securities.
  • Options: Like futures, options are contracts that set a date and price for assets to be bought or sold at. Unlike futures, the parties have the right but not the obligation to complete these trades within the specified amount of time.
  • Penny stocks: Sometimes the criteria for penny stocks can vary based on the brokerage firm, but most of the time they are stocks that have share prices at or under $1.
  • Real-time data: A real-time data feed, often supplied by online brokers, gives investors market and stock changes with very little delay, making it incredibly accurate. Most of the time, the data is delayed less than 10 minutes.
  • Real-time trades: Instead of holding trades to be executed at a certain time, real-time trades are made as soon as they are requested.
  • Research reports: Investors who don’t have the time or analytical skills to conduct their own research often rely on research reports, which are detailed reports containing relevant market data.

Open a Brokerage Account

Prior to beginning trading, you’re going to need access to the market through some sort of brokerage account. Though it is possible to buy stocks without a broker, working with stockbrokers can be extremely educational when you’re first starting to learn to trade in the stock market. You can either use a traditional, personal stockbroker, or you can opt for an online broker.

Online brokers tend to be a bit cheaper than professional stockbrokers, allowing you to keep more of your returns, but they also provide considerably less financial guidance. Ultimately, you’ll have to assess your comfort level and knowledge of the stock trading process to decide which is right for you.

Read Books and Articles About Stock Trading

One of the best and most inexpensive ways to learn how to trade in the stock market is by reading educational stock trading books and articles. These types of resources should be easy to find; just make sure that the source is reliable before you take any advice.

Find an Investing Mentor

When learning about trading stocks, a stock market mentor is a great way to gain real-life insight and expertise. This can be a family member, a friend, a professor, or a coworker. Your mentor should:

  • Have a fundamental understanding of trading and the stock market.
  • Be successful.
  • Have experience.
  • Be willing to spend their time and energy to guide you through your own stock trading.

A truly effective mentor will be there for you as you learn, lifting your spirits, recommending resources, providing assistance, and answering any of your questions.

If you don’t know anyone who fits the bill, online forums can be a useful place to get answers to questions. Just remember that the participants of these forums aren’t vetted, meaning they aren’t always professionals nor are they particularly profitable, so take any advice with that in mind.

Learn From the Experience and Advice of Successful Investors

No matter what you’re doing, it’s always a good idea to learn from the greats. Some investors who are widely considered to be great are Paul Tudor Jones, John Templeton, Peter Lynch, Benjamin Graham, George Soros, Jesse Livermore, and Warren Buffett. By learning their stories and strategies, you can gain some important insight, perspective, and, most of all, inspiration.

Stay Current on the Stock Market

Watching and reading stock market news reports is a great way to not only stay up to date about things happening in the stock market but also to become more familiar with some of the industry lingo.

Participate in Classes and Seminars

Seminars, webinars, live classes, and online courses are all a great way to learn about specific types of investing and different investment strategies. Just like with any other advice or information that you absorb, make sure that the source is credible and be wary of any sales pitches that come with them. It’s easy to get caught up in the hype of someone’s incredible success story.

Practice Using a Simulator

If you’re still a little hesitant to start trading with real money, there are quite a few trading simulators out there that allow you to practice buying and selling stocks before you dive in. Once you do get started, don’t be afraid to take things slowly at first as you get your bearings.

How to Learn Online Stock Trading

R ealistically, how to learn trading online takes the exact same steps as learning how to trade stocks in a more traditional way. In fact, thanks to the prevalence and cost of online brokers, most investors use online trading platforms these days. The biggest difference is that you won’t have access to a personal broker who can give you individualized advice about your trades and goals. Because of this, take a little extra care when you’re learning how to trade, do your research before you make a trade, and make sure you have a strategy in place before you get started.

Experience comes with time, and with it, expertise. Before you know it, you’ll feel like trading comes naturally. Until then, take advantage of all the tools and resources at your disposal. Knowledge will be your most useful asset as you enter this exciting chapter.

Author: Jeff Williams

Jeff Williams is a full-time day trader with over 15 years experience. Thousands of entry-level and experienced traders alike – day-traders and swing-trade small cap stock traders – credit Jeff with guiding them to turning small accounts into big accounts.

Jeff’s "Small Account Challenge" shows people how to transform accounts from a few thousand dollars into $25k, $50k or even $100k.

 

There’s never a shortage of catalysts ready to push stocks to new heights.

And with low prices and low floats, penny stocks are ripe for big moves out of nowhere.

For that reason, traders are always on the lookout for the next penny stock catalyst play.

And once they find it… it usually doesn’t stop there as traders then try to make connections to any stock they can…

What I mean by this is many times when one stock takes off, others in the same industry follow suit… even if the catalyst is specific to only one company…

This is what I call the “Sympathy Play.”

I see this over and over… and it’s not just in penny stocks.

Today I’m going to show you an example from last week, so you know exactly what I’m talking about…

And how to capitalize on it.

 

Last Week’s Sympathy Play

 

A sympathy play is when a catalyst affecting a specific stock is used to pump up other stocks that aren’t directly related to said catalyst.

For example, one company’s news or earnings will often push up the prices of other stocks within the sector… even if nothing actually happened to the other companies.

They get the pop up off the potential they could benefit…

 

First The Catalyst

 

Last Wednesday SPI Energy Co. (SPI) rocketed from a company specific catalyst and set off a number of sympathy plays as a result.

SPI Energy Co., Ltd. provides photovoltaic solutions for business, residential, government, and utility customers and investors.

And then last Wednesday the company announced plans to launch an Electric Vehicle subsidiary… noting the plan to follow Tesla into the end to end business strategy for sustainable energy.

 

 

Tesla is on a tear…

So let’s build some EV’s, easy enough right?

This sent SPI soaring over 4,000% from a close of $1.05 to a high the next day of $46.67.

 

 

I happened to be teaching a lesson in my Platinum room as this happened…

And just look at what some of my members were able to pull out of SPI**

 

 

There’s nothing different about these trades than any other trades… other than the magnitude of the move.

It all comes down to using your strategy and sticking to your setups.

Sometimes you’ll get small moves, and sometimes you’ll fall into a monster like SPI on Wednesday… just by trusting your setups.

 

The Setup

 

Here’s what happened with SPI on Wednesday… and how my members cashed in during a live training I was doing on “Gap Up” stocks.

SPI had gapped up that morning on the “entering the EV market” news, opening at $3.54 after closing the previous day at $1.05.

And after gapping up, the stock was in pullback mode.

At this point I was watching the opening range and looking for a potential buy on a break of the highs…

And of course, as always, my strategies are very keyed-in on volume. I want to see the real demand fly back in as it breaks above the opening range after the pullback.

We set our eyes on the $4.20 mark for a potential break above the highs and another move up.

And…. Well, let’s go to the chart…

 

 

SPI straight up exploded…

Clearly not every stock is going to move like this…

But something you will find in penny stock trading… this does happen.

So if you stick to your setups, you will step into explosions like this from time to time…

You just need to be ready to take advantage of them when it does happen.

And that’s just what my members did**

 

 

And Then, The Sympathy Plays

 

And right along with SPI, over the next couple days we saw SUNW, NETE, and CBAT all taking off on “sympathy” plays.

First let’s look at SUNW as it got the most press related to being up in sympathy.

Like SPI, SUNW is in the solar industry making it ripe for the sympathy play. 

And take a look at this chart…

 

 

As a classic sympathy play…

There was no stock specific news in SUNW.

It shot up because SPI was at one point up over 4,000% and traders needed another stock to push.

The first place to look for a sympathy play is other stocks in the same industry in order to take advantage of the current mood around that industry.

And that’s where SUNW was sitting ripe for the taking…

Here’s how some of my members benefited.**

 

 

 

And then there was NETE.

This just goes to show how well known the sympathy play is.

Check out this press release right after SPI took off…

 

 

NETE was going nowhere before this.

SPI took off and even the Mullen and Net Element company executives took note, releasing the previously announced merger… 

Basically trying to remind/ point out that this stock has some sort of relation to the industry…

And the stock took off…

 

 

Here’s another in CBAT…

CBAT specializes in lithium batteries. One of the applications for their batteries happens to be electric vehicles and with that… the stock exploded.

 

 

This is the “one off play.”

CBAT isn’t going to be making electric vehicles, which was the news that sent SPI flying…

So why on earth would CBAT get this kind of spike when it’s so far removed from the specific catalyst?

That’s the power of the sympathy play.

Traders are looking for action, so they are ready to find even the smallest connection to a stock that’s flying in order to make a quick buck.

And you can use this in your trading too, just by understanding it.

I know my members do.**

 

 

Look for stocks with big volume spikes in the same industry and related industries and then stick to the setups you know and use every day.

With Profit Prismyou’ll get the strategy and setups I use every day

Along with education, alerts, watchlists… and of course access to my live trading and chat room… where I am right there on screen every day.

If you want to be a trader, Learn from the best… Check out my Free Starter Pack Today

 

*Results presented are not typical and may vary from person to person. Please see our Testimonials Disclaimer here: https://ragingbull.com/disclaimer

**RagingBull does NOT track or verify subscribers’ individual trading results and these individual experiences should NOT be understood as typical as or representative. Please see our Testimonials Disclaimer here: https://ragingbull.com/disclaimer

 

Author: Jeff Williams

Jeff Williams is a full-time day trader with over 15 years experience. Thousands of entry-level and experienced traders alike – day-traders and swing-trade small cap stock traders – credit Jeff with guiding them to turning small accounts into big accounts.

Jeff’s "Small Account Challenge" shows people how to transform accounts from a few thousand dollars into $25k, $50k or even $100k.

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