Looking for a 59-Minute Trade? Here are a couple that might be in your wheelhouse. (November 06, 2019)
MTCH SHAK MTCH SHAK MYGN SHAK MYGN
Today I want to look at a couple of stocks. First of all, one that was and then the other one is one that probably will be.
We will first look at Match Group ( NASDAQ: MTCH ). The company reported earnings that weren’t bad but they gave guidance that suggested they are going to have trouble as Zuckerberg’s company decided to get into the dating game. And you know what happens when Zuckerberg’s company decides to do something everybody else suffers.
The stock gapped down about 10 percent. At one point it was trading 11-12 percent down pre-market. The stock opens up a little bit above 62.00 and almost immediately ran higher. In fact not almost in other words immediately. So there was a trade here first thing in the morning and I took it and some of our members at Stock Market Mentor took it as well, I posted it in the forum, 59-minute trade boom. So I traded this for about $3.00; I didn’t want to stick with it for the whole time just because I had other things to do. But I took about $3.00 out of this trade and I was really happy with that.
Buy the stock, buy a little bit more and then wait for the trade to start reversing. And it almost always happens; you are typically always going to get some kind of move like this, up, and then a pullback. And then at some point then you are going to get either this kind of move, a continuation. Or this kind of move, where the stock pulls back further. But you have to expect at some point you are going to get a pullback. And so I traded it until the first pullback and then exited the trade.
Well here’s the deal, that was then so why am I talking about this trade? I will tell you why, because of Shake Shack ( NYSE: SHAK ). Yesterday Shake Shack ( NYSE: SHAK ) reported crappy earnings and the stock gapped down; it traded up a little bit for a quick trade but the stock closed lower. And so if you were looking at this stock to give you one of these you were in trouble. What I am telling you is, don’t lose sight of this stock. This stock will ultimately turn around, I am not saying it is going to regain anything I don’t care about that. This stock will ultimately find a bottom and then start trading up in the same way that MYGEN ( NASDAQ: MYGN ) did. We want to be looking for these types of things.
What I am telling you is, if a stock doesn’t work on the very first day don’t discount it, that it is not going to work again. Because here, MYGEN ( NASDAQ: MYGN ) was in the same category as Shake Shack ( NYSE: SHAK ); it gave you a trade yesterday like Shake Shack ( NYSE: SHAK ) did, it gave you a trade to the long side but ultimately it closed in the lower part of the range. Well today, boom, the stock has given you a really, really nice trade.
What I would suggest doing is run your scans every night. Look for stocks that have traded down appreciably lower; I do it by looking at Bollinger Bands. Any stock that traded down below 2.5 standard deviations certainly 3 standard deviations is a stock that I am going to be interested in looking at. You can make these kinds of rebound trades.
Every day there is something, you just have to be disciplined, require that they fall more than 10 percent. If a stock gaps down 2 or 3 percent there is no real trade there. But if a stock gaps down over 10 percent you are going to find, over the next day or two, some opportunity to buy the stock after all the selling exhausts itself. Again, just for a quick trade, not because you are trying to buy a stock that is trading at the lows and then hold it for months until it gets a new high. This is just typical day trading stuff and you can do it every day.
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