Basura Plays

The main reason why I fail every time I buy third liners is because I don't know how to trade them properly. From the previous trades that I did, I would usually put up the same size of a position the same way I put in blues and second liners. I also put up the same stop loss point. With the erratic behavior of third liners, my stop always gets hit. I am out of the trade and then stock resumes its movement.

Now to solve my problem, I decided to put up a relative small position in third liners when trading with the same amount of capital at risk.

Position sizing is probably the answer to properly gamble on illiquid stocks.

*Word of caution: I am just trying out this idea and I have no idea if this will work. Please always do your own research before taking up positions. Caveat.

**Currently using the crudest form of technical analysis: Trend lines. No other technical indicator is being used as I find them highly unreliable when day/momentum trading. RSI and MACD bearish/bullish divergences doesn't seem to work in intraday charts as they would work on a daily chart.

(If you have better ideas on how to trade this kind of issues, please let me know, it will be greatly appreciated.)

Okay, moving on, using intraday charts to trade:

APC: Breaking out at .89 should be a buy.



ELI: Consolidating at its high. Range of consolidation is at 0.79 to 0.82.
Buy at 0.79. Buy on breakout(Resistance 0.82). Buy on pull back/bounce to/from resistance at 0.82.



SINO: Broke out of trading range 0.38-0.43. Currently heading for correction and looking to test 0.43. Buy the bounce from 0.43.



SUN: Possibly forming a symmetrical triangle. Buy at 0.58 for anticipation breakout.