GENZ was a good trading stock today. NFLX was an awful trading stock. We are only as good as the stocks that we trade. Today I chopped up GENZ and barely scratched out a few bucks in NFLX. The same trader on the same day, I had very different results trading both. Let’s discuss.

First, NFLX made me irritable. I just didn’t enjoy my work trading this nonsensical stock into the Close. BBI (Blockbuster) announced they were hiring a firm to explore bankruptcy. NFLX soared. NFLX is heavily shorted. So whenever positive news is released the shorts scramble to cover. And that is what we saw today trading NFLX. But after the shorts are done covering NFLX tends to revert to the mean. NFLX tends to trade up too quickly and then down too quickly. So while NFLX was ticking up and in an intraday uptrend I remained long. But I recognized that when the shorts finished covering that there was a great deal of downside risk. A reversal was likely. So I was quick to exit NFLX if it traded against me.

From the longside this meant buying NFLX, watching it trade higher, not being able to get a sale, and then watching the stock drop well below where I bought it. I would exit at this lower price and then the bids would start stepping up. When I would go high bid, someone else would bid higher, and I could not get NFLX at good prices. Finally I would get NFLX at a terrible price, watch it trade higher, try unsuccessfully to get a sale, and then watch it trade against me. Greaaaaaaat.

So this was no fun. I couldn’t get NFLX at the prices I wanted on the bid, I couldn’t sell NFLX on the offer when I wanted, and I couldn’t get out when I wanted. My win rate was like 10 percent. My losses were more than I had anticipated before I entered. I was not in control of this stock. Bad stock. Bad trading stock. No way I was gonna make money. The quicker I found a different stock the better.

On the Open I traded GENZ. GENZ held the 53 bid on the Open. I got long 3 lots. It traded up 50c quickly and then almost 1.5 points. Now this is what I am looking for. Chop! Then there was a huge battle at 54.31. ARCA held the bid. A tremendous amount of volume was done here. ARCA finally dropped and GENZ traded down quickly. I got short when the 31c bid dropped. Chop! I continued to trade GENZ on the short side as it traded in a clean downtrend.

Look, for GENZ you could miss a few moves, wuss out of a good position, take a rip here and there, and still make good money. There was just no way that those trading GENZ would not make money. Further, I enjoyed trading GENZ. There was no stress. In the spirit of this whole Bachelor controversy, GENZ was like picking the smart, pretty, normal girl to date. NFLX was like picking the crazy girl with whom you know things just aint gonna end well. Pick the normal girl and your life will be easier. Pick a good stock and you will enjoy your trading day.

Best of luck with your trading!