Obviously having less than $25,000 in my account meant that I could not execute more than 3 day trades within a 5 business day period.If I exceeded 3 day trades then I either have to deposit enough money to get the account to $25,000 or wait 90 days for my account to revert back to normal margin status. This presents a problem and an obstacle to increase your account 500% to 600% in a pretty quick period of time. I found a way to execute strategic trades in which I will buy a stock within 10 minutes of the market closing in the OTC or pinksheets and holding the position overnight to sell for profit in the morning.This was my answer to get around the day trade limit obstacle.Its not hard at all and anyone can try it for themselves and Ill explain how you can quickly find a stock that will gap up overnight and open higher in the morning. Essentially this type of trading is what I call gapping a stock. Now here is how to quickly find a stock that meets a couple of necessary standards before you buy.
Ok you will find a stock to target at this website:
https://www.otcmarkets.com/market-activity/current-market
This website is the official OTC website and is free, fast to use and never has any pop ups or sign ups
Feel free to look at it right now so you can see for yourself
Now to target what stock you want to gap you need to scroll down just a bit to where it shows the advancers
You can choose the price range of stocks to look at. you can choose $1+, .05+ and all
I never use all because i dont trust sub penny stocks. most of the time I click on $1+
Then you will get a list of the biggest gainers of the day but the most important key to successfully
gapping a stock is Volume! Theres no need to look how much a stock is up or look at even the stock symbols
It shows how many trades were made so far in the day,How much volume in shares and volume of money.
So to target a stock start looking at the gain % on the day so far along with the volume. Volume is by far the most important key and the % gained should be 10% or more but stay away from high flyers that are up 50% or more
Ok so Volume is #1 you should look for the amount of trades to be over 500 with the stock up at least 10%
You will end up targeting 6 to 8 stocks. Now you need to go to your trading platform to see which of those stocks are closing strong.In the final 15 minutes the price should be near the high of day or making new highs and there should be steadily increasing buying volume as it approaches 10 minutes before market close.At this point you will have the stocks narrowed down to between 1 and 3 choices.Check the stocks daily 1 month chart to see if its up because its breaking out or in an uptrend and check to see if it had good news come out that day.
The best gappers seem to be either breakouts, a strong uptrend or good news.I dont execute my purchase of the stock or stocks I have chosen until there's somewhere between 5 minutes and 30 seconds left before market close.The traders that got the stock going will always have a certain percentage that will sell their positions at the end of the day and especially on Fridays you may see selling start with 5 to 10 minutes before close.This will maximize your chance of executing your buy at a price below or equal to the closing price.
Now here's how to exit your trade:
OTC stocks open at 9:30am and during the hours the markets were closed traders will see the news or see the stock on a scanner or just by searching during the night to find stocks that should run at the open using the same method that you used to find and buy the stock at the previous days close.More buy orders than sell orders will cause the stock to gap up for example MRMD may have closed at $4.56 but will gap up as orders come in before the open and may move it up to a possible bid price of $4.77. If you purchased 1000 shares at the close an sell right at the open you will have a realized profit of +$210.00 and it was not a day trade because you held it overnight.That's how I started building my account value up quickly.
General rule of thumb is if it gaps up really high for example if it opens 20%-30% above your entry price then sell right away at the open because chances are it will dip and dip fast.Sometimes it pays on to hold the stock until 9:45am or 10am if it gaps up and opens say 5% to 10% higher because many times the morning flood of buying volume will make the stock run higher but always remember to sell on the way up so your order fills immediately.
I hope as many people as possible try out this trading method and make that money.Always remember VOLUME is the #1 key
Any questions or clarifications or if anyone wants to see exactly how I picked my gappers and how much I made over a 1 week period feel free to ask.