Entries are one of the hardest parts of trading to master…
New traders get so excited to trade that they chase spiking stocks and end up buying the top.
Or they jump the gun before confirmation and end up having to cut losses on a trade that had no pattern or setup.
If that sounds like something you get caught up in, you have to learn to control your emotions…
And you need to learn the right setups and patterns that can signal a trade…
I’m sharing three with you today that played out in Intelligent Bio Solutions Inc. (NASDAQ: INBS) on Friday.
Knowing them could’ve helped you take pieces of INBS’s 190% move…
Three Potential Entries to Look For Daily
Trading doesn’t limit you to only one way to make money — there are thousands of different ways to trade the markets.
I like to keep it simple by looking for these three entries everyday…
Buy in Pre Sell In Pre
Buying in premarket is an aggressive strategy. So this entry is for experienced traders or those who are on a hot streak…
If you want to trade in the premarket, here’s how I do it…
I like to use the five-minute candle chart. I look for a big green candle then I wait for a pullback and for the stock to put in a red five-minute candle.
From there I trade it like a dip and rip and would enter when the stock breaks the high from before the red candle. Here’s what it looks like…
In this case, INBS barely put in a red candle. But it was enough consolidation to create a big upward move.
INBS chart: 1-day, 5-minute candle — courtesy of StocksToTrade.com
And as the buy-in pre, sell in pre name suggests, you sell your position before the open.
The reason is that trading at the opening bell can be volatile. The first five minutes can trade a ton of volume. And nobody can predict what the stock will do at the open — especially when the stock’s a chat pump.
So lock in your gains and look for another entry…
The Dip and Rip
After the open, look for a dip and rip pattern.
This is when the stock pulls back at the open and then reclaims the premarket high.
That can be confirmation the stock can go higher. You can join the momentum to the upside and lock in profits as it climbs (keeping in mind an ideal three-to-one risk/reward).
INBS chart: 1-day, 5-minute candle — courtesy of StocksToTrade.com
Wait For The Afternoon
Once the morning moves are over, it’s time to wait for the afternoon. Skip midday trading that can be unpredictable and have low volume.
Come back after lunch and look for stocks that have held up all day — ideally consolidating at or around VWAP.
Just like INBS did on Friday…
Then look for the VWAP hold high of day break pattern.
INBS chart: 1-day, 5-minute candle — courtesy of StocksToTrade.com
Those are three entries you can look for in any low float big gainer trading high volume that holds up.
Pick the best entry and strategy that makes sense for your trading style.
If you don’t know your trading style — tune into a free training session to see what clicks for you.
Have a great day Money Monday, everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade