Trade Smart With a Rolling Watchlist

99% of penny stocks spike for one day and die. How do you find the 1% that turn into multi-day runners?

This isn’t the first time I’ve talked about this. But I think it’s worth repeating because some people haven’t heard it, and others still haven’t figured it out. And it’s a simple formula anyone can follow…

The Big Picture

If you want to find the 1% of penny stocks that don’t follow the penny stock lifecycle, this is the answer…

The Rolling Watchlist Methodology

Here’s how it works.

You start with a watchlist for every day of the week. So you have your Monday watchlist, your Tuesday watchlist, et cetera.

Then, at the end of each day, you look at the big gainers that have held up into the afternoon. Because, again, 99% of penny stocks spike and die the same day.

Now, the very first thing you do each day when making your watchlist is, you add the day’s big gainers.

I do it the same day after the market closes. So, Monday night for Tuesday, Tuesday night for Wednesday… you get the idea.

Now, does the stock have to close at the high?

No. Because some of these stocks have a massive day but just chop around in the afternoon. But they build support and still close up.

So, a stock like that would roll over to the next day’s watchlist, even if it pulled back off the highs.

The next thing you do is, you go back through your watchlists from the past five days and you pull up the charts. I look at a 10-day chart with 5-minute candles, and a 1-year chart with daily candles.

You look for those stocks that are still holding up. What we’re looking for is exceptions to the penny stock lifecycle.

So, anything that has held up, or bounced back, we roll over to the next day’s watchlist.

Now, very few of them get rolled over. But if you keep watching the big gainers from the past five days, there will be one or two. And those stocks are in play.

Now, how do you apply that?

Two Patterns That Work Well for Rolling Watchlist Stocks

This is where the weak open red to green and pivot plays come in.

With a stock that rolls over from one day to the next (meaning it still closed up), you pay attention to the previous day’s close. That’s the red to green or green to red line.

Then you look for something that’s also got tight alignment around the pivot point. The pivot point shows whether a stock is considered bullish or bearish.

Red to green and the pivot point are two momentum shift areas.So, you look for alignment of the two where the stock is above the pivot (bullish) and breaks through the previous day’s close (also bullish).

My Take

This is something I preach and preach and preach. If you track your data, the best, most predictable, most reliable setups are multi-dayers. As much as I love day-one runners, the odds and probability and the profit potential are so much better on day two, day three, day four, and in some cases longer.

So, use the rolling watchlist methodology to keep track of these stocks. It’s a smart move for smart traders. Then, learn the patterns.

Watchlist

In keeping with the idea of a rolling watchlist, Our Bond, Inc. (NASDAQ: OBAI) spiked on Tuesday.

It was choppy, but it held so it was on my watchlist yesterday. As you can see, there was a solid premarket move for anyone who was prepared. For what it’s worth, it was trading sideways right above the pivot point when it spiked again.

Start your rolling watchlist today. Track your data and see if you don’t spot more multi-day runners using this method.

On My Radar

• My video on Rolling Watchlist Methodology
• The Fed held rates steady yesterday. The market didn’t love it.
• Way off topic, but if I saw this yard sale sign I would literally drive there and ask how much for everything they have. Price does not concern me…