Today we're going to be talking about liquidity and why it's so important and things to look for. So welcome back everyone! I'm lead trainer with tax trade Tim Bowen Um, a terminal Often here is liquidity and that is based on the volume traded each trading day. I You know something: A lot of people will overlook this. Maybe they'll see a good chart and you'll see some news, but remember if the stock isn't trading unusual volume, the odds of it actually moving and paying you out on a trade are very low.

I Mean, it's a lot of people overlook this, but it's like one thing to see in artificial intelligence. Press release: Okay, artificial Intelligence the hottest hot sector out there right now, but sometimes these stories just don't catch on in the market. and I've had people email me actually today, Muln: Okay, Mullen Automotive Many of you know my hatred of this stock and I begged people to avoid it for almost a year now. Like this morning, Muln had a press release and the stock was trading no volume and ultimately went nowhere I Think at the point someone brought it up this morning, it was up seven one thousandth of a penny.

Okay And they're like, what do you think about this and I'm like there's no volume. It doesn't matter if there's news. They launched their AI powered Persona vehicle Tech Technology People are like it's Ai and I'm like there's no volume. Okay, I'm like there's nothing going on with this but they're like it's EVs and it's Ai And look at I Didn't realize this holy crap getting destroyed.

It's down 25 this might be. Write this down. This might be muln. Might be the most disgusting, terrible, biggest scam I have ever seen mean in penny stocks.

Literally like this might go to zero in the next couple days. And my friends, this is what frustrates me again for nine months. I have every day when I do those pre-market webinars, they're like, what do you think about muln and like the same thing I said yesterday it's down. 25 people are just getting destroyed.

So anyway, the point is I don't care if it has Ai and I don't care if it's EV if there isn't liquidity because remember what makes a stock move exponentially higher? Something a lot of people don't think about. like, like a lot of people don't think about the fact that the stock market is a market. Okay, and right now it's summer 2023. One of the best analogies I like to use are Taylor Swift Tickets Okay, whether you're a Taylor Swift fan or not.

I'm sure you know she comes to town for one night. There's 20 000 seats in the stadium and what are those tickets gonna sell for? Are they gonna sell for face value? Especially like the first five rows? No way. Because they come to your town and you have one shot. She might not be back for a year, She might not be for two years.

And if you're a 50 year old guy like me with a 10 year old daughter that loves Taylor Swift Guess what? You ain't paying face value. You ain't paying double face value. You're probably paying a hundred times face value or more. And that is because of the demand.

And the supply and supply and demand imbalances are what drive a stock like Vcig. Now think about Vcig versus muln Vcig. You can see how to uh press release uh VCI Global to distribute AI based state-of-the-art socialized messenger, blah blah blah social media and AI Two buzzwords you go back to this morning. gaps up huge by 10 30, 11 A.M This was trading 25 million shares on the day.

What I want you to focus on is that 60-day average 600 000 shares an entire day for the last six 60 days for two months. The average part or shares this thing traded the entire trading day was six hundred thousand. By 10 30 a.m this thing had traded 20 million plus. Now we jump over to the Oracle which is our stock prediction tool and you look at this thing had a predicted entry at 3.95 and then also I went over a 4.50 break.

On the morning webinar you can see I'm like hey, the volume's there liquidity. the AI press release is there. Everything is here for a 450 break on this thing and whether you took the Oracle signal or my predicted level, this thing went to 11 30. Now I'm not saying you would have exactly nailed the top at 11.32 but think of the potential.

Maybe you buy it 450 and you sell it 550. not bad. Maybe you sell it Six, seven, eight nine. I Mean it went all the way to 11 32.

And the reason it did that? Look at the volume, look at the liquidity and that proves that there's more buyers than Sellers And what happens in Taylor Swift tickets or coffee or eggs. Remember when eggs were eight bucks a dozen a few months ago. The reason they were eight bucks a dozen? because it was all those Farm failures and chicken flu or whatever it was. There just weren't enough eggs.

People want eggs. Now you're not paying a buck 50 a dozen or two bucks a dozen. You're paying eight bucks a dozen. And that is one of the biggest things that you constantly constantly have to be cognizant of.

And that is supply and Demand and balances, Supply and demand imbalances. It doesn't matter if it has an AI press release like Muln, if no one wants the stock except the bag holders, it ain't going nowhere. I Was kind of shocked. it's down 25 percent, but it's a good illustration of what happens versus Vcig low float stock.

I Mean Mun has billions of shares in the float, so there's no supply and demand and balance. there. You look at: Vcig 2 million in the float 600 000 average 25 million shares traded before 10, 30, 11 A.M And right now stocks pulling back. But look at this thing.

110 million shares and we got a hour and 15 minutes left in the day. This could trade 150 million shares today and as long as it closed is above view app. It's a number one play for tomorrow. Now next thing, it's not just price moving.

Okay, listen on you. write this down. Unusual volume creates unusual price action. That's what we want.

An insane volume creates insane price moves. Now the other thing I want you to be cognizant of is even if you're trading small size. like if you have a small account, you'll find if you're trading illiquid stocks, it can be very, very frustrating. You just can't get out like you buy and you eventually get a fill on your trade five minutes later.

Which okay, fine. But then let's say the stock reverses on you. You're the only seller. Okay, and if it's illiquid, you might have been there.

Actually, let me know in the comments. If you've been there on an illiquid stock, you put your cell in and then all of a sudden the bid drops. You're looking at your level two, You just gotta. You just got a small position, thousand chairs.

You put a cell in. the bid drops and you're like okay and you wait a few minutes. You don't get taken on your ass. You lower, you, lower, your ass and the bid drops again.

You're like what is going on here. Listen, it ain't Bigfoot it ain't aliens. It ain't chupacabra. All that is is market makers gaming you because it's an Ill liquid stock.

They know you're the only seller. They're just gonna keep moving away from you until you capitulate and probably put in a market cell. And then they Remia steal your shares and bounce the stock. Okay now listen.

I'm not saying there aren't Market Maker Game games in liquid stocks. but when you got something trading 100 million shares I don't care what your position size is, you can easily get in and out. I Mean you can look at my level two right now. I Mean there's just thousands and thousands of chairs traded a second on VCI IG And even if you're got a 10 000 share position, 100 000 share position, you could get out of this stock.

If you're trading in the liquid stock, they're going to move away from you and they're going to steal your shares and then bounce it. You'll be like what just happened. You're you got game because you're trading illiquid stocks. So my friends, you want to see this live yo.

How to trade level two. We get a lot of questions about that. How to read the tape on level one? You can see mine. How to interpret liquidity, How to do volume profile analysis Vpa Again, we use that as a derivative of the 60-day moving average on the value.

You'll float rotation All of these liquidity based ideas. Check out the Daily Income Trigger system. Webinars: Live every single day, six times a day included on weekends and 100 free. We go live every single day.

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