Some Q&A from J.B.:
I have two questions I was hoping you may help me with: I checked out the Early Bird watchlists you prepared. The list for today that consisted of strong closing stocks, under $10. Are there any reasons why you chose the selected stocks (EGHT, ROYL, CIGX, HDY, etc.)? There are other stocks that closed strong, under $10 that were not on the list. Perhaps, there were other technicals or strategy applied to filter-select the particular stocks you had chosen? I applaud your OCZ trade today. That was an excellent play. Concerning the price action for only the morning trading, what 1) drew your attention to OCZ (perhaps, previous nights hw and if so, what did you like last night about it? or perhaps there were some TI-alert criteria that matched?) and 2) why was the level you entered (7.10ish in premarket) compelling at the time, if you can recall?
Let me try and answer your questions as best I can.
As for the Early Bird Report…those are stocks that have had some sort of news out since the previous day’s close (usually earnings…occasionally some other company related news, especially with biotechs). These will be stocks that will likely be gapping up or down, and ones I may be trading premkt. Those stocks that are gapping usually have alot of volatility, and I try and put those in front of people because volatility = opportunity…at least that is the way I see it.
On the same page to the right, you’ll see my Twitter Feed. Each day after the close, I run a filter of stocks that closed well…within a certain % of their daily range. I like to keep those on my watchlist the next day in case there is some follow through. Sometimes my filter won’t catch certain stocks. Sometimes I just decide to cull the list to a manageable number. HOWEVER, these stocks won’t necessarily be on the Early Bird Report, since the did not have any sort of news overnight. I know it may be confusing, and I will try to make it easier for people that are coming to the site. Your feedback helps.
As for OCZ today…it was on my radar all premkt (I am up trading at 6:30 central time) because of the news that came out about a possible design win w/ Dell. I decided not to chase at premkt highs of 7.50 because the bid/ask was too thin and I thought maybe I could get some on a pullback at the open (which I did). The fills I got at 7.10 were the result of me swiping an offer that seemed as though it was stepping down to get filled. The 7.10 area was yesterday’s high so it did have some meaning. Really though, I just like the possibilty of a reversal on a long red candle at the open due to the nature of its “in play” status. The early scalp worked well, and then the afternoon move was even better. The move past 7.50 was nice because it represented a “5 for 5″ setup for me…meaning it had the following 5 catalysts working in its favor:
volume (higher than average)
intraday pattern (consolidating just under opening range highs)
daily chart pattern (reversal past declining TL)
news (as previously mentioned)
broad market sentiment (broad market was really rallying at the time of the 7.50 break.
Hope that helps