Whew! I've been waiting for a trade like this in my short month-ish trading. $IZEA was running for the 3rd straight day and I watched that morning dip buy opportunity spike from 5.75 to over 7, but I didn't buy because I couldn't see any other catalyst. Always 1st or 2nd day, right?
Well, found out later that there was a contract announcement. I refreshed yahoo and there it was: Seven figure contract (renewal), that had to extend the ability of this to run, right? But something's weird here: Yahoo isn't showing that news, or rather, it's showing intermittently as I refresh the page; now it's not showing again. I did see it on the nasdaq site when I looked up the ticker earlier there.
So here was what I thought was the setup:
Big gainer: check
big volume: check
Low float: less than 4 million shares? Check.
News: Contract winner this morning (actually, I think it was just renewals): check
So, it seemed poised, to me, to make another run or two in the afternoon if not overnight. I was waiting for a dip buy during the mid-afternoon lull. Saw some "support" around 5.90, and when it failed to break that, decided to buy around 6, but got in at 6.08 thinking it would come back to around 6.30 rather quickly. My risk was 5.90, and was wanting it to test the day's high again at 7.17. The plan was to sell at 7ish, giving me 4:1 risk:reward. This also seemed like something I might want to hold overnight if I thought it might have a chance to break 7 tomorrow (i.e. if I saw it test 6.90+), but that didn't happen. Stupidly high volatility for those who watched it, it was all over the place. About 10 minutes to close it was holding between 6.50-6.60+ and decided I would sell at 6.70 if it would hit, otherwise I'd hold overnight (or maybe sell in after-hours if it went nuts...). Sixty two cents, with my small account position (100 shares.. over half of my account, oof), but my best gain thus far.
Then I see some comments by @timothysykes saying that buying today was a bad idea. I'm a complete newbie so now I wonder if this was more luck than trying to apply what I thought were rules? Are all day 3 buys risky, even with additional news? I'd like to think I learned a little about contract winners today, but part of me now questions that.