Right. It's the summer of 2022 and i don't think. This is gonna gonna change in the fall or the winter and if anything continue to explode. So we're gonna be talking about today is volatility and i think you know ultimately.

I think especially if you're you know new to penny stocks or if you've only been trading or investing volatility. I think gets a bad name and i love it and today. We're gonna be talking about why you should too so that means that i'm lead trainer with stockstotrade tim bowen and so what is volatility at the end of the day you might hear about the vix. Which is the fear index you know the vix moves when we see these wild moves in the market.

But it's particularly tied to the big board stocks et. Cetera and the reason. You know a lotta people. Ask do you follow the vix do you not i really don't because every day is madness in penny stocks now i know that sounds bad.

But if you have you know a rules based system and you have a process and a methodology then volatility's not bad actually. It's what we make our bread and butter on in day trading and swing trading to a certain extent so when we say volatile it's just a stock with wild moves to the up and to the down side ilag is a good one example of today currently setting up for an afternoon vlap hold abcd pattern our number one afternoon pattern. I'm recording a little before noon right now i l a g is the stock so you can see the stock has gone from you know basically friday afternoon. I'm recording on monday that'd be the friday close was it two bucks already went to 4 already basically doubled this morning and then pulled back hard okay went from four all the way back down to 350 basically a dollar downside so 2 of upside dollar of downside and again we've got the entire day the entire week this stock good chance.

This is gonna be in play all week. So ultimately the great thing about that is you can make money trading those moves long and short. I mean again. We don't focus on short selling that much on this channel.

But i mean volatile stocks are great for short sellers'cause you get that panic selling you can see like right here once this. Thing fails vwap you know big pull back down 30 40 cents at downside. I mean on a 3 stock it's not a bad amount of downside and if it fails to reclaim vwap could have potential further downside probably risk awful vwap for those short entries or vice versa. If it regrinds back towards a high day.

You'll get short sale or buying panic so if you understand the psychology you can trade both ways i mean that's again you gotta have a margin account to short. But you look at this beautiful dip and rip okay look at that and spikes up in pre. When the news hit reclaim that pre market high at 330 dollar share of upside. So there's your dip and rip.

Okay. Then you'd short a vwap fail. And again. You gotta have a margin account.

You gotta be over the pdt. I mean when i talk about these multiple entries and exits. It's not really unfortunately not really a newbie strategy. Because again most of you if you're new you're probably under the pdt.

The bummer is you know and i always say this when i mention the pdt one of my favorite ronald reagan quotes. The nine most dangerous words in the dictionary are'i'm from the government and i'm here to help' the pdt in most of the times in my opinion pdt does exactly opposite of the intended you know. But hey listen government regulation aka. The road to hell is paved with good intentions.

Anyway that being said you can trade these stocks both ways now what makes them so volatile what creates this volatility so what i wanna focus on and why i l a g. Is such a great example is float rotation okay understand that the stock market at the end of the day it's a market. It operates on supply and demand okay. I don't care if you're talking iphone cases.

Or cold beer on a hot day or hot cocoa on a cold day. You know there's variances in the supply and the demand and if there's too much supply okay. If there's an oversupply that's when you go to the discount store and you're like hey look at you know designer clothes for a tenth of what they were selling well. The problem is they've manufactured too many there's too many out there so they end up at the you know the tj maxxes or the big lots or whatever they're called at a discount because there's too much supply vice versa.

I'll stick with the fashion'cause. I'm such a you know i'm such a follower of fashion myself quite the fashion icon. But it's a good analogy. I mean think about two months ago two months ago.

When this new fashion was released. I mean everyone wanted it i mean you're paying you know hundreds of dollars for a t shirt. Because you couldn't get them the celebrities are wearing'em you know the rock stars are wearing'em. Everyone wanted'em then a few months later more like a year later nobody wants'em anymore discounted okay low float stocks are that analogy when you got a stock like i l a g.

With news you know it's a recent ipo so everybody wants in this just ipo'd four days ago unlimited expectations you know everyone's excited about it. And you've got eight million shares in the float. So typically we look for less than 10 million shares is what we call a low float stock now back to supply and demand notice. I'm recording at 11 45.

In the morning 80 million shares 10x float rotation. So you gotta understand that these explosive moves come. There's only eight million shares out there to be freely traded not held by insiders not locked up et cetera so what happens again if it's a t shirt. If it's an iphone case what happens to the price of anything if there's eight million of'em.

But there's demand for 80 million plus and again typically we're halfway through the day now. We're talking flipping here. It's a little bit you know when i use that physical property analogy it breaks down because you know ultimately if there's eight million t shirts and all eight million t shirts sell well there's no more to be sold okay with stocks we're flipping'em. Okay you know we're in and out all day long.

So that's how you're able to buy and sell 80 million of something that there's a supply of eight. But that limited supply creates explosive moves that's why this stock goes from three to 438. In 20 minutes yanks back because everybody's tripping over each other to churn that float so that's one of the biggest things we look for when we look for extremely volatile stocks and especially the afternoon move so a lotta. These might not go through the float you know two three four five 10.

I mean we're already at 10x float rotation this might hit 20x especially if they start grinding back towards the high of the day you don't see'em every day. But a lotta days you do and those are those great afternoon. Setups'cause. Again you're trapping short sellers through the day you're getting everybody.

Excited you're getting people churning churning churning the shares and you know a lotta. The times people aren't selling so you know hey there's no way to know this intraday. We would know this down the road'cause you'd have to aggregate data from all of the different brokers. But hey there's a good chance half the float is people holding on and they're not selling'cause.

They think hey. The stock's going to 10 or going to 100 you know that bag holder mentality. So and again you can't prove this till after the fact. But there's a good chance.

The actual float right now may be three four million maybe less of people that are flipping the shares so now magnify that times. You know now you're talking you know 50. 60. 70.

80. Times float rotation. Simple supply. And demand.

And it's a great way to think about the volatility that it creates. I mean listen apple has billions of shares in the float. I mean apple's having a good day today last i. Knew it was up 5 oh ripping when.

I checked it a little while ago it was. Up 5 it.'s up 7 . That's a good day. I mean i bet you if you turned on cnbc right now they're talking about this huge move in.

Apple but think about it 168. Billion shares in the float and it's trading 25 million shares. Okay you can't well barring some i mean listen if steve jobs like comes back from the dead. Which would be awesome.

I miss you steve i really do then you would see some ridiculous move in apple. But that's why we don't focus on these stocks when we're day trading or especially. You with the small account'cause. I mean think about it you got a small account.

What do you got 20 shares of apple. It's up 1 whoa. Huge day for apple you make 20 bucks well that's related to the float rotation. Which creates that volatility hence.

The reason. Why you need need need to be running all your scans for less than 10 million float that's the biggest takeaway from this video is if in my opinion. Now you gotta have stops you gotta have plans you gotta have disciplines. But if you're trying to grow a small account please just block out anything with more that 10 million float and if there's no big gapper.

If there's nothing with news. If there's none of those box checkers just don't trade that day okay'cause you're probably gonna trade a mediocre setup. And you're probably gonna just take you know that classic one step forward two steps back so focus on float rotation focus on insane value focus on those box checkers and if you don't have a setup like i l a g. Don't trade okay.

It's not a video game okay you're not doing this for action. You're not doing this for fun you have to focus on the most volatile stocks that's the only way to grow a small account over time once you get a bigger account you can diversify maybe trade some apple maybe trade some amazon focus on volatility focus on float rotation. And if you really wanna get i mean. This is a short video 10 minutes.

But get into the steadytrade team. I'm doing three today's monday. I'm doing three webinars today average length of 45 minutes. It's truly the way to master trading.

So if you wanna know more about these concepts. If you're still confused after this video hit the link below check out the steadytrade team. I'd love to work with you.