bullsonwallst, Author at Bulls on Wall Street

Weekly Day Trading Recap 7/11-7/15

bullsonwallst — Sun, 17 Jul 2022 13:55:38 +0000

For the first time in weeks, the major market indices had positive news to rally on.

While the CPI number came in at 9.1% last week for June, many took at as a potential sign that inflation has peaked for now since oil and other commodities had fallen significantly from their prices in June. The number was not accurately reflecting the current prices of commodities in July.

To help you understand how Kunal day trades in these market conditions, we will do trade recaps rounding up some of the best and worst trades of the week so you can understand his thought process and stock selection!

Let’s start by analyzing the $QQQ, what it did last week, and what to expect from it this week:

$QQQ

It was a strange week with the market gapping down for two days in a row and getting bought up. We are still inside a range, but with all the positive news last week a multi-week bear market rally could be on the cards. Watch the $296 area this week carefully, if we can hold over that level tech stocks and should see a nice rally.

If you don’t know what the $QQQ is, it is an ETF that tracks the NASDAQ 100 Index, which in layman’s terms it follows technology stocks.

Here are a few of Kunal’s trades from the week, and some key lessons you can learn from them:

$OXY & $BABA Shorts

$OXY was the classic opening range breakdown set up. With oil getting crushed last week, $OXY was the ideal trading vehicle to short to get in on the downside momentum. He got short at $57.35 in the morning at around 9:50AM, covered half into the flush at $56.87, and covered more into the flush into the low $56s.

$BABA

$BABA had a similar setup at the open, but didn’t follow through as well. Kunal took profits quickly because $BABA was still uptrending on it’s daily chart, and you don’t want to marry shorts when you’re going counter the bigger picture trend of the stock. He got short at $108 at around 9:45AM, covered half at $107.8, and covered the rest into the flush into $107.

He also tried the $PDD short, expecting weakness in other China stocks with $BABA rolling over, but it didn’t follow through so he took the small loss on it.

$NVDA

With semi-conductors often being a market leader when the market shows strength, Kunal made several trades on Nvidia to the long side to capitalize. He made this trade after the market rallied on Wednesday and we had the gap-down reversal.

This was actually a mid-day trade, where he got long after it reversed off the market open. $NVDA is a very high beta stock, meaning it closely follows the overall market. At this time the $QQQ and $SPY had a major reversal after a gap-down, and trapped many short sellers. Kunal got long at $151.27, sold half at $152.07, and then sold the rest in the high $152s. This is the type of trend that You will get in and out of, and reenter once it sets up again. Kunal made many other trades like these on semi-conductors and other momentum stocks to take advantage of the squeeze.

Biggest Lessons From the Week

Focus on TRENDING sectors. Be in the stocks in these sectors that have the best range and liquidity to capitalize on the momentum. Don’t get stuck in the chop. Let the indices guide your bias for the trading day. Earnings season is around the corner, and it will hopefully bring in some strong news plays that will bring in expanded ranges and trends!

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How to Build Winning Trading Habits in Sixty Days

bullsonwallst — Wed, 08 Sep 2021 19:28:01 +0000

How much would your trading improve after 60 days of intensive training with experienced traders?

Studies show that it takes 2 months on average to form a new habit. This is why our Live Trading Boot Camp is 60 days long: To create meaningful, lasting improvement in your trading skills.

No one can achieve mastery of skill from passive learning: YouTube videos, books, sitting in a chatroom aren’t enough. Here’s how you need to approach your trading education:

This course is challenging and engaging. But it has consistently been the turning point in our student’s careers over the past 13 years of teaching these boot camps:

Kunal Desai and Paul Singh, the instructors in our 60-Day Live Trading Boot Camp, have over 4 decades of combined trading experience at your disposal. Here the format, and everything you will learn:

To get even more detail about our boot camp, click here to check out our comprehensive boot camp syllabus.

Think you have what it takes to complete our boot camp? Only 4 seats are left in tomorrow’s class!

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Trading Watch List 08.13.2021

bullsonwallst — Thu, 12 Aug 2021 23:32:14 +0000

$QQQ strong bounce off the 20MA today, feels like we’ll have a Friday ramp tomorrow to end the week. A lot of momo names reported earnings after-hours today, will have a lot of gappers to add to the list tomorrow during pre-market. Check out tomorrow’s watch list and game plan:

Follow me on Twitter for real-time trading setups@kunal00

Earnings Reports From After Hours

Click here for my TC2000 charting layouts if you want them!

Earnings breakout last week with a nice orderly pullback to the daily 9EMA. Held nicely, on watch a for move to $135+.

$OGN

IPO from earlier this summer. Strong breakout today on high relative volume, on watch for a day 2 continuation play tomorrow.

$AFRM

Keeps knocking on the $70 resistance area. Keep this on your watch list, when it goes it will happen fast.

$NTLA

Biotech name starting to curl and base on the daily 9EMA. On watch for a push to $180+ tomorrow and next week.

$BIDU

China names getting smoked lately, short-bias on all names. BIDU my go-to because of the range.

$FLGC

Hot flag on the daily. Feels like it’s waiting for the 9EMA to catch up. Likely find some momentum in the upcoming trading days.

$NVAX

Range starting to tighten last few days. $250 area getting tested the last couple weeks, on watch for a break for a quick pop.

$FUBO

Great earnings reaction a couple of days ago. Nice inside day today, on watch for upside momentum over today’s high of day.

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Trading Watch List 08.11.2021

bullsonwallst — Tue, 10 Aug 2021 20:33:34 +0000

$QQQ hammered today, creating a lot of ugly charts. Still a lot of earnings season left, still expect momentum to continue in some of the hot names this week. Check out tomorrow’s watch list and game plan:

Follow me on Twitter for real-time trading setups@kunal00

Earnings Reports Before the Market Open

Click here for my TC2000 charting layouts if you want them!

$DDD

Great earnings gap and push today. This name has a history of going on a monster run after earnings. Keep this on watch for more upside this week.

$FSR

Another name that can squeeze that just had a positive reaction to earnings report. Over $20 this can really get going.

$DKNG

200 SMA a big level. If it can break and hold over, expect a strong move to the upside. Set alerts on this around $54.

$AMD

Momo name with several days of pull back. If it can gap down tomorrow, I’d play it for a bounce to the longside.

$BTBT

Another momo name that has been a great trader. Signs of holding the 9 EMA today, on watch tomorrow for a quick long trade.

$AMC

Earnings gap got sold into hard today, amazing short opporunity. Wouldn’t be surprised if they kept unloading shares tomorrow, especially if we gap up. On watch for a short.

$MRNA

Topping signs today, on watch for a short tomorrow. On watch for a gap up and a green to red move.

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BOWS Day Trading Chatroom Weekly Recap 7/8-7/12

bullsonwallst — Sun, 14 Jul 2019 14:28:23 +0000

It was a busy first week in the launch of our new day trading chatroom. Today we are going to talk about some of the trades Kunal and some of our members took in our new chatroom, and share our thought processes for you to learn from:

Some of Kunal’s Trades

These trades were from last Monday, but these stocks were in play all week. Kunal and some of our members hit these names multiple times throughout the week. $OSTK, $CRWD, and $RVLV had some crazy range all week, and there were multiple opportunities on these names throughout the week:

$OSTK

$OSTK is on a strong uptrend, mostly due to the strong uptrend in Bitcoin over the last month. It’s a choppy trader, and you HAVE to be buying on dips and selling into strength. If you are chasing this, you will be smoked out. Best way to do it is to scale out quickly and leave some of your shares for lotto after you’ve taken profits and moved your stop up.

$RVLV

$RVLV is a recent IPO from June. After a strong couple weeks, it has pulled back a bit, and started to base and grind up last week. Provided a nice ranger with opportunities to the long and short side. Keep this on watch this week for more upside momentum with a break above the $40 level.

$CRWD

Here is a video recap of a trade Kunal had in $CRWD last week:

$CRWD is a recent IPO like $RVLV, and has a similar-looking daily chart. but it has a bit more liquidity in it to get more size on your trades. It has been grinding up its daily as well. Keep this on watch this week for a continuation of the uptrend.

BYND Trade Example

One of our moderators Nick had a decent trade on Beyond Meat, $BYND. Last week it was consolidating in a very tight range and broke out on Monday. It has been on a strong uptrend all last week and provided many trade opps all week. He got long on the break of the $154 daily resistance level and scaled out into strength into the $157-$158 area. The conviction for the trade idea came from the tight consolidation on the daily chart under the $154 level.

Student Screenshots

Some of our students had strong trading weeks as well. Applying what they learned in the trading bootcamp to the markets. Here are a few screenshots of theirs from the room:

Next week is earnings season. One of the best times of the year for momentum traders. Going to be a lot more opportunities to the short and long side.

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For the next two weeks, we are offering a 50% LIFETIME discount off all chatroom subscriptions. Instead of paying $199 per month for either of our chatrooms, you will only pay $99 for as long as you are a BOWS member! The same applies to annual subscriptions!

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The Best Part-Time Jobs For Aspiring Traders

bullsonwallst — Fri, 05 Apr 2019 15:11:56 +0000

A big issue aspiring traders run into: How can I make money to sustain myself while I’m building up my trading account without working a full-time job?

If you are considering transitioning into full-timing trading, it is tough to work a job where you are preoccupied for 8 hours a day, and often during the market open. But you also don’t want to cut yourself off completely from a reliable income source, especially if it is early in your career or you don’t have much savings.

There are several ideal part-time jobs that work well for aspiring traders, who are looking to transition into full-time traders. When I was transitioning to a full-time trader, I did all of these jobs, so all of these accounts of these jobs are from first-hand experience.

These are not glorious jobs, but easy ways to sustain yourself while you get your trading career off the ground. All of these jobs require few qualifications, and are very flexible with their hours:

Lyft/Uber Driver

If you have a car, this is a great way to make some extra cash outside of market hours. The average hourly wage is probably about $15-$20 an hour, depending on when you drive (After gas and insurance expenses). The best part about these is that you can work whenever you want.

You can trade in the day, and drive in the evening or early morning. Usually, you can find a consistent amount of work once you hit the road. It helps to sign up with both apps to increase the probability of you finding riders if things get slow on one of the apps.

Postmates/Doordash/Uber Eats

If you don’t want strangers in your car or don’t have a car, food delivery for these companies is a decent solution. If you live in a big city, you don’t even need a car, you can use a bike or go by foot. Like with Uber/Lyft, you can work whenever you want.

You probably make about $15 an hour on average, but you also get tips. One of the downsides is that sometimes you might run into dry patches where you don’t get any orders while you’re out. To minimize the chance of this happening, work during lunch and dinner hours, and also work for multiple companies. If UberEats is slow, you can also have your Postmates app up to find jobs.

TaskRabbit

Very cool app that allows you to get hired to all kinds of projects. You can get hired to do delivery service, home repairs, moving, heavy lifting, and a bunch of other chores people don’t want to do. You can make decent money from some of the heavy lifting and moving projects, I’ve gotten up to $50 an hour in the past for these.

The downside is that the projects aren’t as consistent as Lyft and Uber. With Uber, Uber Eats, Postmates ect. you know for sure that you will be getting work as soon as you turn on the app.

With TaskRabbit, you need to build up your rating and credibility in a bit in the beginning before you can get hired consistently. An easy way to get over this hump is to drop your hourly rate below average to get yourself a flow of projects in the beginning. Ask your friends/family to hire you through the app to get going.

Upwork

If you have skill sets in the creative and digital realms, Upwork.com can bring you some decent income. I know some traders who are web designers and copywriters who used the site for supplemental income when they were getting their trading off the ground. Like with TaskRabbit, you need to get projects and good reviews under your belt to start generating consistent projects and money from it. Do projects for friends/family and have them pay you through Upwork to get you off the ground.

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Why High Dividend Stocks are Overrated

bullsonwallst — Wed, 03 Apr 2019 14:48:04 +0000

You see tons of social media posts touting the stocks with the highest quarterly dividend. Coca Cola and AT&T are often cited as being great stocks to own because of the high dividends they provide shareholders. The reality is that dividend income is an almost irrelevant component of owning a stock. There can be a huge opportunity cost of owning a stock just for its high dividend yield and is the wrong thing to be focusing on when making investments. Before talking about the misconceptions surrounding high dividend stocks, let’s start by defining what a stock dividend is:

What is a Dividend?

A dividend is simply a reward a company gives its shareholders in return for owning their stock for an extended period of time. The reward most commonly comes in the form of quarterly cash payments, but some companies also offer shares of stock. In this article, we will focus on the companies that pay cash dividends.

Dividend Income Relatively Inconsequential

You see posts everywhere how Warren Buffet makes almost $7000 per minute from Coca Cola dividend income. He also owns about 9% of the whole company, which means he has several billion dollars worth of shares. Coca Cola offers 40 cents a share per quarter to shareholders (Buffet probably gets a better deal because of his stake size). If you owned $46,000 worth of Coca Cola, at $46 a share (current trading price roughly), you would own 1000 shares. This is a pretty sizable position for the average person, and it only yields $400 per quarter, which is only about $133 per month. Nothing life-changing, it might be able to pay for your utilities for that quarter.

Focus on the Stock Trend, Not the Dividend

What you should instead be focused on is buying stocks that have shares with a high probability of appreciating in value in the near future. Obvious statement, but so many people get caught up in a stock’s dividend instead of the actual trend of the stock. If you owned 1000 shares of Coca Cola, you should be more focused on the probability of the stock going up or down 2 dollars a share that quarter, which is making or losing $2000, instead of the $400 you get in dividend income. If the stock goes down just $.40 a share that quarter, your dividend income is gone and you are at breakeven.

Opportunity Cost

There are way more efficient uses of that $45,000 that is tied up in yielding you just $400 per quarter, which can easily be canceled out by a small fluctuation in the stock price. The reason we prefer day trading and swing trading is because of the potential to make much larger returns in a short period of time. Once you develop the skill and become consistently profitable, you would never consider trading AT&T or Coca Cola stock. If you look at the daily of Coca Cola, it is not a stock that I would be buying or trading. You want to buy stocks that are trending on their daily and weekly time frames if you are a longer-term investor/swing trader. Coca Cola has been very choppy for the last few years and has no range or volatility to capitalize on. It is not worth holding for the dividend either. Coca Cola’s shares have actually lost about 10% in value since mid-February, and they raised their dividend from $.39 to $.40 a share to try to appease unhappy investors. This was just a meaningless attempt to appease unhappy investors, and the dividend change barely does anything to offset their losses.

Summary

Dividends are not a bad thing. If you can find a stock that appreciates in share value and has a dividend, great. Just sure it isn’t the primary reason why you do or do not make an investment. Focus instead on finding the most efficient use of your capital. Think about where you could put your money that would yield the highest return in the shortest period of time. Don’t buy a stock just because of the size of its dividend.

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Pros and Cons of Trading Penny Stocks

bullsonwallst — Thu, 21 Mar 2019 14:58:59 +0000

Most new traders are drawn into trading penny stocks by the prospect of making 100’s of percent returns in just a few days. They expect to turn $1000 into $10,000 in a week because they are going to buy the next Amazon. I know many successful small-cap and penny stock traders. We have many traders in our chatroom who have made small-caps their primary niche. There are a ton of opportunities to the long and short side on these names. But the trading style is not suited for everyone. And most do not understand the challenges of maintaining trading consistency in the niche. If you are considering trading small-caps, you need to know what you’re getting into. Trading them is not as easy as most trading services make it seem. Here are the pros and cons of trading small-cap stocks:

Pros

Don’t Need Much Capital To Make Returns

Whether you are buying or shorting small-caps, you don’t need to have much money to be able to make solid returns. When you trade a bluechip stock like Facebook, which trades at around $165 a share at the moment, you need to have tens of thousands of dollars to get a worthwhile return from trading or investing in it, and it takes forever to move. With penny stocks, you only need to buy 500-1000 shares of a $5 stock to make decent returns. That being said, this doesn’t mean you should invest in them, as most of these companies fail in the long run, and you will lose your money. Small-cap stocks should be treated as trading vehicles, not as long term investments. If you follow a proven strategy and have sound risk management, you can potentially trade these successfully and make good money.

Large Range

As you have probably seen, small-caps can get some crazy momentum once volume and buyers come in. 50%-100% moves happen usually on a monthly basis in rabid bull market we have been in for the last decade. The large range can provide amazing trading opportunities if you can time your entries and exits correctly.

Fast Moving

Penny stocks will often make these huge percentage moves in just a few hours or days. BPTH ran from about $7 to $73 in just two days earlier this month. Penny stocks will sometimes rip 50%-100% in just an hour at the market open. These things move fast, so you have to be very quick to capitalize on these opportunities to the long or short side.

Cons

Many Fade Their Gaps

The majority of small-cap stocks are garbage companies. This doesn’t mean you cannot make money off them to the long side, as many small-caps with awful fundamentals will go on monster runs (BPTH going from $2 to $70 is 3 days). But you should understand that 99% if small-cap stocks that gap up on some type of news will NOT make a BPTH-like move. And you have to sell into strength. Most of the time penny stocks gapping up big, even with a positive catalyst, will get sold into hard, and fade off the whole day. Many novice small-cap traders get stuck holding the bag and lose a ton of money. Don’t chase these stocks blindly. If you do trade these, be sure to take your profits when you have them.

More Manipulation

Because small-cap stocks have low market caps, it doesn’t take much money (for Wall Street players) to move these markets. If we look at a small cap stock like $SOLO, it’s float is only 10 million shares, and it trades at about $5 a share. It only takes 10 million dollars to buy up 20% of its float. Just a drop in the bucket for most Wall Street funds. These big players can buy up these names and send them a skyrocketing price. But they also want to sell eventually. They know that these companies are garbage also. They will eventually exit their positions. And when this happens, the stock comes crashing down.

Timing is Difficult

You see a stock that ran from $5 to $70 and thinks that it was obvious in hindsight. But it wasn’t so obvious when you were in the moment staring at the stock when it was trading at $5. How do you know this is the one that goes to the moon? If you buy these junk penny stocks that gap up on some type of news with the expectation of doubling or tripling your money, you will fail hopelessly and lose all of your money. Buying or shorting these stocks at the correct times is extremely difficult. These huge moves up only happen in a few minutes, and no one really knows if it will continue the trend when it’s up 100% or dump and give up all its gains. If you are looking to short these because they are junk companies, you can risk losing a ton of money if you mistime it and get stubborn. Even if you right 99 times out of 100 on your shorts, it only takes 1 BPTH to wipe you out if you get stuck short.

Stressful

There are wild swings when you trade a stock like BPTH. Sometimes it will make a 100% move up, and then dump 30%, then go up another 50%, and then dump 50%. It is stressful as F*** to trade these, even if you just take a small $5000 position in them. It also makes you trade more emotionally, and will often cause you to buy and sell at the wrong places. 99% of small-cap traders fail because they have no system or risk management. You don’t need to trade penny stocks if you have a small trading account. You can still make great returns trading mid and large cap stocks with WAY less stress. This is why we focus on slightly higher priced names at BOWS that have momentum. They offer slightly lower percentage returns, but they are much higher probability plays, and more predictable.

Summary

Small-caps can provide some amazing opportunities due to their range, especially the low float ones with high relative volume. But most traders underestimate how difficult it is to capitalize and actually make money from these stocks. Small cap stocks are very unpredictable, and timing entries and exits are difficult. Do not trade them if you do not have a system with an edge and sound risk management.

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Short Interest Definition: What It Means For Traders

bullsonwallst — Sat, 16 Mar 2019 14:41:04 +0000

Short interest is a statistic I always check before I trade a stock. We’ve gotten a lot of questions about what it means for how you trade the stock, and how it affects your bias. Today we are going to start by defining it, and then discuss how you should make trading decisions based on it:

Short Interest Definition

The short interest is the approximate number of shares that are short a stock, meaning shares that are being used to bet on the security going down. For traders, you want to also look at the “Short % of Float” statistic to see what percent of the stock’s float is short the stock. This essentially tells you what percent all the people who own shares of the stock are short, and who are long. A stock that has more than 10% of its float short the stock is considered to have high short interest. You can get these statistics about a stock’s short interest at shortsqueeze.com and finviz.com. These statistics about a company’s short interest is typically updated 1-2 times a month.

Why Short Interest Matters

A stock’s short interest by itself is not by itself considered to be an immediate buy or sell signal. You want to pair it was some technical pattern or fundamental catalyst. It is most effectively used when a stock is in play, meaning it has some type of catalyst that is bringing momentum and volume into the stock. It can support a long thesis because you know there are people who will be potentially underwater and looking to get out if the stock starts to squeeze. If you are looking to get long a stock, and you see there is a high short interest in the name, that tells you there are a lot of potential people who may look to exit their positions if the stock starts to uptrend and breakout.

W Example

Wayfair Inc. is a great example of why it pays to know a company’s short interest. On February 25th it gapped up in response to a strong quarterly earnings report. We have talked about in past articles about how to know if a gap up will fade or follow through. Another factor to consider is the stock’s short interest. Look at the daily chart, and you will see how much it gapped up on the day it reported earnings: If you look at its “short percent of float”, you will see that its short interest is just over 25%. This means there were a TON of shorts who were underwater, as the stock was gapping up 20%, and is right at all-time highs. This would tell you there is high probability shorts will be looking to exit their positions when the market opens to escape further pain. This means that going into the market open, you know there is a high probability the stock will squeeze and gives you an opportunity to take a long position to capitalize.

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3 Ways to Reduce Your Trading Fees

bullsonwallst — Tue, 12 Mar 2019 19:43:29 +0000

Trading fees are the cost of doing business. For small accounts, trading fees will cut into your profits more, and make your losses bigger. Understanding the ways you can reduce trading commissions is useful for cutting down your trading overhead. Cutting fees are not going to turn an unprofitable trader into a successful and consistent one. But it is useful to know these tips, as these little things can end up saving you thousands by the end of the year. Here are 3 ways you can reduce your trading fees:

1. Change Your Broker Commission Structure

Broker commissions are an unavoidable cost of trading stocks. But changing your commission structure to suit your style of trading can reduce how much you spend on trading commissions. Active traders who scale in and out of positions should not be paying a per-trade commissions structure. A per-trade commission structure is the default type of commission structure most brokers will put clients on. Most brokerages charge between $5-$10 per trade. This can really add up if you are an active day trader who scales in and out of positions. You would save a lot of money by switching to a per-share commission structure. If this is your style of trading, call your broker and request a change to a per-share commission structure. They will likely change your structure to keep you as a happy client, as you are still making them money regardless. Some brokers have per-share structures that get cheaper the more monthly volume you do (If you are trading larger position sizes).

2. Add Liquidity With Orders for ECN Rebates

Adding liquidity when you trade allows you to get ECN rebates when you put your buy/cover orders on the bid side and sell/short orders on the ask. If you take liquidity, ECNs will charge you additional fees. You will see these ECN fees on your broker statement. However, ECNs offer rebates to incentivize individuals to add liquidity and create a market for their securities. In order to get these rebates, you need to have a direct access broker which has ECN routing options. You also have to make sure your broker offers rebates, and see if you have to take action to activate the rebates. Once you ensure your broker offers rebates, you need to make sure you are routing to the right ECN. ARCA is the most common one that offers rebates. To get the rebates, you need to make sure you are routing your buy and sell orders to ARCA (if that’s the route they offer). You need to sit on the bid and wait to get your order filled to buy a stock, and you need to sit on the offer and wait to get filled on a sell order. Keep in mind that sometimes your order may not fill if you cannot find a buyer or seller at the price you are looking to get filled at. You may have to adjust your order price to ensure your order executes. To increase the probability of getting your orders getting filled when adding liquidity, put your sell/short orders when the stock is spiking, and put your buy/cover orders in when the stock is dipping.

3. Avoid Overtrading

Even if you able to change your commission structure, you will still be paying a lot of money to your broker if you are overtrading. Overtrading is when you take too many trades in an attempt to make back the money you just lost, and results in you taking unnecessary losses. In addition to the trading losses you will take, you will rack up more commissions and fees. Overtrading is one of the biggest barriers for traders to overcome to achieve profitability. For tips on how to combat over trading, check out this article here.

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