Evening all, i'm basically putting this out here as a warning and a lesson.
So after months of studying Tim's (and a few others) DVDs, video lessons, blog posts, etc and applying them, i finally started becoming profitable (top 100 on Profitly this month) and amazingly consistent, profiting off 27 TRADES IN A ROW thank God. 27 trades in a row without a loss.
Unfortunately, that might all come to a bloody end either tomorrow or next week (still assessing my options).
Basically i bought XGTI on the dip Monday afternoon (12/19) at a pretty good price (around $3.50/sh or so) and ended the day about $2-300 up. Unfortunately i was unable to cash out because of the stupid PDT rule (which actually HURTS new traders than helps). So i was forced to hold on overnight but i was feeling good because, with the price i was at, i was risking maybe 20 cents a share and looked to gain a possible 40 cents a share. And as i said, i was around $2-$300 up on the day.
Unfortunately i realized something was wrong the next morning (Tuesday) when i checked my phone around 6am and saw that the stock price plummeted around A DOLLAR PER SHARE. When i checked on NASDAQ's website, i saw that the biggest drop occured around 5am (how was this possible??). So i was watching and planned on waiting until the morning spike to get out.
Then NASDAQ halted trading at like 8am until the next day (Wednesday) and in the meantime XGTI filed (at like 6am) with the SEC an offering (dilution) of $2/sh, like a dollar and a half LESS than the closing price on Monday. So naturally, the stock price had plummeted another dollar down to $1.60ish.
So the stock price (and thus my investment) lost HALF of its value basically overnight and there was absolutely nothing i could do about it.
So the original plan was to stay for the next week or two when if shareholders from Vislink (whom XGTI is acquiring some of their stuff) approves the deal, because i was expecting that that would spike it a bit enough to either get out completely unscathed or with more of my money back. But then those scumbags just release another filing where in it they mentioned deep in there that they have about a week to pay this other recently acquired company over a million dollars, otherwise they would have to make another offering. So after screwing investors with a dilution just a couple days ago, they're warning of another possible dilution at least a week from now.
Meaning, i need to get out ASAP before they do another bs 6am offering filing.
As for lessons learned? While swing trading has been incredibly profitable thank God, it looks like i will lose all of my recent profits as a result of this 1 swing trade gone horribly wrong (plan was to buy Monday afternoon and sell Tuesday morning, like i've done dozens of times) so ima have to just stick to day trading.
And Tim or anyone else here if you have any advice (or parental scolding), i'd love to hear it.
Might just be something to hold on to. If you look at the company's chart history another spike is inevitable. Sorry to hear about this. I dont like the PDT rule, but as I have heard Tim state, the good thing about the PDT rule is that it can stop you from overtrading. When I'm at the PDT rule I have truly think about if I get into a stock, is the risk holding overnight REALLY worth it. Only with an extremely good catalyst will I trade if I'm under the PDT rule. If I do trade when against the PD
Its an earnings winner or a swing trade. Good luck and God Bless!
It's to late now but if you ever get in a pet situation again you can still trade and get the margin call removed because you're broker will drop you're first violation
Pdt*
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