What's up everyone? All right. So in this episode we're going to go over the anatomy of a trade and the stock we're going to look at is W-e-t-g W-e-t-g Today made a 160 percent move. It is a recent reverse split and it had a I news. So the combination of recent reverse split and AI news was enough to send this thing up 160 percent.

I Finished the morning up over 18 000 just this morning trading Wetg! So this is a stock that's definitely worth looking at in a little bit more detail. So what we're going to do is I'm going to start from the very beginning and kind of walk you through. uh when I saw the stock What? I Initially kind of my gut reaction the second I saw it and what I want to try to do is slow down all of that to help you better understand why I took the trade because what can happen when I'm live trading and some of you guys who are watching while I was live Trading It can happen so quickly all of a sudden out of nowhere a stock starts squeezing up and it's like boom boom boom boom. Next thing you know I'm up by 10 15 000 and it's like whoa whoa wait where did that come from? How did you know? There's so many questions.

So what we're going to do in this episode is, we're gonna really dissect this trade. We're gonna go over the anatomy of the trade. We're going to slow it down. We're gonna go back to the very beginning when the news came out.

All right. So let's go to Screen Share. Let's take a look at this. So this morning at 8, 30 and 7 Seconds Wetg hits my scanner at 9.89 Now when it first hit the scanner, the very first thing that I saw number one, the scanner that it hit is the up ten percent in less than 10 minutes which which is a scan that tells me a stock is moving quickly.

So I have an audio alert turned on for this scanner. Uh, in fact, it's kind of funny. my dog when he hears that scanner, he like lifts his ears up because he knows if I'm not in front of my computer I'm going to be running to my computer and he better move out of the way because I'm going to be moving quick. So I hear the scanner I'm already sitting here.

So I pull up Wetg I pull up the ticker and I already know the stock. So how do I already know the stock? Well, you know we have such a large trading community that people are mentioning stocks all the time and this is a stock that a bunch of Traders were talking about uh, towards the end of last week because it was conducting a reverse split. So for those that don't know about reverse splits, this is something I talk about extensively in our classes there. I have a whole setup that's dedicated to um, trading reverse split so you go under Um products and check out The Warrior Pro You can check out my trading classes and you can see the curriculum there.

But basically, Um reverse splits are a very common occurrence with small cap companies. So these lower price companies, they struggle often to keep their stock price over a dollar a share. And that's a problem because there's a minimum listing requirement to keep your stock above a dollar. So NASDAQ Nic American the American Exchange They will de-list a stock and tell them to go to the OTC market if they can't keep their price above a dollar so short of being a better company that's more profitable.

the only thing they can do is a reverse split and so companies do this all the time now. IPO Let's say ten dollars a share. They'll IPO 10 million shares and then what ends up happening and they'll just do the Whiteboard here just so you can see the math a little bit better. So we get IPO Um, Ten dollars.

Um, and it's 10 million shares. So this would be a 100 million dollar. Uh, 100 million dollars that this company has raised Um through this. IPO All right.

So the stock ends up declining in price. It goes all the way down to, you know. Let's just say for easy, easy math, it goes down to 20 cents a share. All right, that's a problem.

It's below one dollar cut off. So what the company decides to do is a reverse split. So let's say in this case they say well let's do a ten to one reverse split. So we currently have a 10 million share float and we're priced at 20 cents the next day.

The stock resumes after the ten to one split and it's at two dollars a share. and the float is, uh, one million shares. So the market cap doesn't change with a reverse split. But what does change is the price and the flow.

So in the case of Wet G W E T G, they did a 185 to 1 reverse split and they just did it on Friday. So you can see here this was a huge reverse split 185 to 1. But that's what they needed to do to get their stock back up. Not just over a dollar, but well over a dollar.

All right. So they do the reverse split. Now that has an effect on the flow. So you see the float.

Here's list is 62 million shares. Well if you go into the filings and you check the filings, you actually will see here. Um, so this was this is a little bit older. this was as of November 2022 they had 195 million share float.

So you go through the filings and you get into a little bit more detail. But what you'll realize is that as a result of this reverse split, the adjusted float is now actually like a I think it's even less than one million shares. So now is a very small float. Okay, so I was already familiar with the stock ticker wet G because they had just done a reverse split.

People were mentioning it, but that didn't give me any reason to trade it on Friday or Monday or Tuesday because it, you know it, there wasn't any setup on it. And then at 8 30 today, what happens? News: So we have our news desk here. uh, that drops the headline and I can pull it up right here. So the news is.

um, we trade group launch large-scale language processing models to increase production applications to the field of artificial intelligence. Keyword Buzzword: That's a hot word right now, right? So all of a sudden what happens? the stock starts to squeeze up so it goes basically almost immediately. from you know, nine dollars, eight, nine dollars, up to 12.. Now I saw it right in here and you know what? I honestly thought I was like uh, volume is a little light.

It was only like I don't know 25 000 shares of volume I was like I don't know. Volume's a little light and the spreads are a little big. That combination of light volume with bigger spreads that can be a recipe for disaster that doesn't always play out well for me. So I I didn't take a trade.

I was just like oh, let's just watch. let's see what happens, because look, if it's really strong, we'll have more opportunities, right? No reason to chase it. Patience Now for those of you that don't know, I Just um I Just got back. Today is my first day back in my office.

I've been trading my traveling trading station for the last 10 days. I Flew to Colorado with my five-year-old son and we picked up a Sprinter camper van and we drove it all the way back. If you've ever done a road trip with a five-year-old a 20 plus hour road trip, you know how important patience can be. So I pride myself in being a patient person most of the time and I am pretty good with my patients when it comes to trading.

So yesterday, for instance, I was trading in Lancaster County Pennsylvania with my starlink all set up uh and I didn't see anything that looked good. so I didn't end up taking any trades and I was like that's okay. You know some days there's just nothing there. Patience Today all of a sudden, I see something that looks good I'm willing to strike.

I'm ready to step up to the plate. Patience is super important. So I said all right I see it squeezing up but I don't have Fomo right now. The volume is a little light, the spreads are kind of big.

Let's just see what it can do. Okay, so it ends up, um, going a little higher up to 12 and I was like ah shoot, that was nice. Okay, so I ended up missing a trade which I considered but talked myself out of from 11 to 12 right there that was called a micro pullback. So I didn't take that first trade.

Uh, but then it pulls back a little bit more, pulls back a little bit more and watch right here. Okay, so it's going to pull back just a little bit more and that's going to curl back up and right here it breaks through 12. that's where I broke the ice with my first trade. Now Lightspeed's not really great with their charts, which is why I don't use them for charts.

We have our own charts here. These are the warrior charts. These are available for students who are using this platform at Warrior trading. But in any case, my first trade was right here.

uh just before it broke through 12. so that was my first trade, took profit, got back in, got out. you can see I just trade the whole move up I never know how high a stock is going to go. Some people would say Ross can't believe you sold.

you know right here. for 900 a profit you should have held that whole position for you know 10 points could have would have showed it. You never know how high something is going to go and I'll tell you guys my perspective on trading is a little bit different than some people. I trade from a perspective of I'm trying to make money every single day mentally.

I'm trying to make money to pay bills because that's how I learned how to trade. That's what it was like for me when I was getting started. I wanted to make 100 200 a day to pay some bills. so as soon as I was up 100 200 I take it off the table and then look if another setup forms I'll get back in.

So even though today I I've been incredibly fortunate to make over 10 million dollars trading and I don't really I could just let it roll I still have that mentality that I need to take a profit off the table and this is something I talk about a lot with the um, you know Financial Independence retire early sort of uh, philosophy and how you can apply that to trading because really, to me trading like one or two hours a day kind of is retirement. So if you can get your 100 or 200 a day and then you know you can go enjoy the rest of the day. that's pretty much retired and that's like making fifty to a hundred thousand dollars a year in retirement like that's phenomenal. Most of the people who do the fire movement of you know Financial Independence Retire early.

They try to save up like one million dollars so they can pull out four percent a year, right? That's forty thousand dollars a year. So now they've got like thirty three thousand dollars a month they can use to pay their bills. Well geez, if I have a thirty thousand dollar trading account and I can make 200 a day trading in one to two hours, that's the equivalent of having a million dollars and drop drawing four percent out. So like I kind of look at it as being a similar way of achieving the same anyway.

so so that's just to give you some insight there for those that aren't familiar. So anyways, my first trade is at this: Arrow right here for the break of 12. and I jumped into that trade so let me just go back. So um, I bought 4 000 shares there I bought two thousand at 11.71 and I added another 2 000 at 11.97 and as it broke through 12 I took 3 000 off the table at uh 12 and 13 cents.

So this is a for me, like just a standard kind of base hit. Get in, get green start to build a cushion and then once I've got a cushion built up, you know, let's see what it can do. all right? So this is a one minute micro pullback. sorry this is on a 10 second chart right here.

so it's a 10 second micro pullback right there. Uh, under 12. So I got in right down here and then took profit through this level. And the thing Spikes all the way up to 13 I was like whoa.

Wow, Okay, this is showing that it has a willingness and an ability to move. Now for those that aren't familiar, there's a couple different criteria that I look at to consider taking a trade. Uh, the reverse split isn't a criteria for trading. Uh, it's nice to have it.

But um I look for a couple things. Number one: I Look for a stock to be up at least. Uh, 10. Now there's no question that this.

Check the box. I Look for a stock to have relative volume five times or higher. So now let's just double check this. Um, when the stock first popped up, it might not have quite met that criteria.

Um, no, it it did. It did. Actually, even though the total volume was light as you can see, so the total volume was light. but it was.

so the total. The relative volume was 2.28 when it first hit. So already the relative volume was pretty high and by the time I would have taken that first trade at 12, the relative volume was six. Okay, so in fact, check we got the relative volume.

So I want to see it's up 10 I Want to see relative volume is five times or higher I Would typically like to see news, right? and this one had the news. And to make it better, it had a buzzword buzzword which in this case was Ai Ai stock so that's terrific. That's what you like to see. Then we like to see I prefer price between 2 and 20.

check and then I like to see float of under 10 million I mean I don't mind trading a little higher but you know 20 million under 20 million is fine. But in any case, this one was 1 million. so check. So we had 1 million.

We had price of uh 12 to start. It did get a little more expensive. Towards the end we had the AI news. We had the relative volume which started at six and went up from there and we were already up uh, 35 or almost 40 percent when I took my first trade.

Okay, so these are my sort of five criteria for considering a trade. These are my minimums and this is how wet G stacked up against that. All right, so it meets them, uh, fairly well. It's very, very well I would say All right.

So uh, so we first get this move here and I'm gonna stay on the 10 second chart just because even though this is a short time frame, it's a very fast time frame. It's helpful for you guys so you can visualize micro pullbacks. All right. So let's see.

Um, all right. So that was my first trade, then it goes back. it goes up here and it pulls back and I take another trade. uh I bought the dip.

Uh, it pulls back to this uh, sort of blue line here that I draw drew between uh, this candle and that candle. All right. So I got back in at 12 34. this was a 2 000 shared dip trade and I added 2 000 shares at 12.59 and I was anticipating the Breakthrough 13.

we ended up hitting a high on this candle of uh, just under 13 and then we broke through 13. So just like that, nice trade. not bad I added at 13 sorry 12.96 I took profit at 13.21. we hit a high here of 13.30 Not bad at all.

What's the next trade? What would you guess the next trade again as it pulls back to this blue ascending support line. I'm adding back another 2 000 uh, sorry this time I did 1500 shares a little smaller size, reducing risk a little bit. but I added another 1500. so I got up to 3 000 shares instead of where I would have been at four thousand I felt like it was getting a little extended I wanted to manage my risk so it goes a little higher here up to 13.45.

it's a little resistance. at the half dollar, it drops down at this point I Kind of thought. All right. maybe this is done.

It dips down here and I did start looking for dips, so this was at Um 58 858. So let's see. I got a dip trade at 1307 which was a nice dip trade right down here about uh with a 10 cent stop 12.97 and it ends up giving us a nice move here. Surprisingly good, but I started with 1500 shares at 1307 I added another 1500 at 13.14 I had another 1500 at 13.49.

So 4 500 shares and now I'm taking profit as it goes up through 14. Again, like you can't really complain about that. That's a really nice trade. Now at this point the blue ascending support line I didn't know how valid it was.

we broke below it. we came back above it. oops, Um, yeah, there we go. Uh, so I I was I had that line drawn and it did seem like we were kind of up against it here.

So as we continued into pre-market we get you know, 9 A.M So by 9 A.M right at 9am I'm up 7 500. So I've already had just in this range here. 7 500 a profit. That's not bad.

All right. So it's holding up well, it dips down and then look at this move right here. a bounce off 14 right there. So let's see.

my next trade was. um, let me look. So my next trade I took a trade at Um at 902 I got in 1500 shares at 1443, that was at 902. Uh, that gave us uh, the move up towards 15.

uh, added at 1504. So a starter 14.50 approximately adding at 15. average is 14.75 on that candle. It ends up squeezing up through 1580.

that's great. Then it pulls back and I add again right here through 15, 70, 15, 60 and it curls up again. Bought this dip. Now it feels like this blue ascending support line is kind of back in play.

We get a really nice dip off it here and move up to 17. then a little bit of a bigger pullback to 1580. So this was around 9 9 10 in the morning. So around 9 10 we sort of uh I did a dip trade here where I bought a thousand shares at 15 uh 94.

I sold it at 1611 and I was like I don't know it double bottoms here I didn't take that double bottom trade. it comes down to Triple bottom I tried and did not get filled on this triple bottom and then right here I said okay, you know what? the Uh 1650 level I'm concerned that we're gonna see a rejection off that level. Why? Because right now we're zoomed in on the 10 second chart. but we've got to pull back and look at the five minute chart for a second.

So the five minute chart was showing us at that time that we were really extended. All right. So we were extended. We were well off of our moving averages, so I was like I don't know I I'm a little concerned about a rejection here.

All right. So Watch What Happens So it starts to pop up and it flushes down all right. So it comes up to right here and it flushes down. It hits a low down there and I Let's see so this was at Uh 9 17.

So let me just zoom forward. So I ended up um, buying at 16.84 as it curls back up here and I was looking to ride the momentum through high of day. I bought a thousand shares. One thousand.

Not a big position, but you know I was like let's let's see what this thing wants to do. Add another thousand shares. At 16.90 it breaks through 17 and goes to 17.50 and just like that, that's 50 cents a share. I added it 1758 and 1766.

Now I'm looking for the move up to 18. and look at how this pulls away right here. So this was the beginning of a really a parabolic move. It started to really open up.

Now the only problem for me, and although I did make ten thousand dollars on this leg of the move I felt that I had to reduce my risk a bit because the price was getting higher, the spreads were getting bigger, and I was concerned about having that final trade. You know you buy high, sell higher, buy high, sell higher, and then you have that final trade that burns you and if you keep adding more and more size it can be it can be bad. So on this trade right here this was this was I suppose the most disappointing trade of the day in a way because on this trade I added for the Breakthrough 2050. and on this candle, it spikes up over a dollar a share and I tried to take some profit but I didn't get filled I filled.

maybe I don't know 500 shares of the 4 000 plus that I was holding I might have even had five thousand. So I had a nice position and I ended up stopping out flat right here. so then it drops down, it comes back up again and look, it does it even more dramatically. So this time I got back in right here for the retest and I was able to lock up some profit.

but I was still holding 800 shares into that drop and I lost a thousand dollars on that flush right there. and at this point I was kind of like I Don't know guys, this is starting to get a little risky. So my last trade on it, uh was a dip trade on the resumption of the halt I added at um, let's see it was 19 and 1875 and then I took profit at about 1915 and I was like you know what? I think I'm I think I'm good on this So you know the thing is, this had this really nasty flush here and it had this kind of rejection here and it halted up at the open. but I didn't want to trade it because it was concerned about volatility of the open and then we got the open higher and halt down.

The bounce wasn't very big, it holds up again, then it halts down right so now it's just starting to get a little too choppy. and I just say you know what? I think it's fair to say that we had on this one the front side of the move which began uh early at 8 30 and which I traded from about 8 45 up until this level. but this whip in these two candles and then this halt down that really marked the top and that was the everything here was the front of the move and everything here so far has been the back of the move so it's still holding up, uh, relatively well. it's up 76 percent.

That's not bad. I'm sure there's people that have traded it much longer into the day than than I did, and some may have made more and some may have given back profit. But one of the things that's important that I always think about is making sure I'm walking away, walking away sooner, quitting sooner before you have a close call before you potentially give back half your profit. Because on a trade like this where you have halts down and gapping lower or where you have those kind of whips, they're like two or three dollars a share.

You know, with four or five thousand shares, it wouldn't take much to lose eight or ten thousand. So I feel like I certainly could have made a lot more on this had I traded it a little bit differently. a little bit better, but at the same time Green is good. I'm grateful for the gains that I got.

I Always try to study these charts and ask myself how I can do better next time. So if I see it almost the same pattern tomorrow, how can I trade it a little bit better? And if you're trying to always strive to be better I think that you're you're doing the right thing. So this has been the anatomy of a trade on Wetg: eighteen thousand, five hundred, thirty eight dollars, and nine cents. Really solid action.

like not totally perfect. A little issue with some spreads I Had some issues with some of my orders not filling, but all in all we got some good action. Got Green I certainly got Green I Saw a number of people saying that they had done really well on it, which is great to see and hopefully this is a helpful lesson for you that you can take and apply in your trading to help you trade the next one a little bit better. So thank you guys as always for tuning in.

I'll remind you as always of my disclaimer that trading is risky. My results are not typical. There's no guarantee you'll find success whether you trade on your own. You'll learn from me.

So take it slow practice in a simulator before you put real money on the line and I'll see you for the next episode real soon.