One of our SMBU students visited our desk in NYC from Sweden today. Merritt, from SMBU Trading Conversations on Friday 1:30PM EST, joined us for lunch, as did this trader’s dad. This European trader is a graduate of SMB DNA and The Winning Trader and working on his game, after work hours from Europe.

There were two issues that arose during lunch that merit discussion:

1) What trades do I take with a limited ability to watch markets?
2) How do I settle on the best stocks to trade during Earnings Season?

What trades do I take with a limited ability to watch markets?

For this trader I like:
a) Changing Fundamentals Trade- Look for a news catalyst that is unusually positive or negative for the stock and follow the intraday trend.
b) Multiple Time Frame Gap and Go Holds- Look for a Gap and Go holding on multiple time frames, such as the 1m, 5m, 15m charts.
c) 2nd Day Trades- Find a stock that was In Play on Day 1 and look for follow through on Day 2.

These are three setups for which to practice in real-time.  They best position the European student trader for success in our markets.

How do I settle on the best stocks to trade during Earnings Season?

As I wrote in One Good Trade, “You are only as good as the stocks you trade.”  This is an important question above.  See four quick ideas below.

a) I will host a webinar this Thursday to discuss this topic.
b) Consider this routine: SMB AM Sheet, SMB Scanner, SMB AM Meeting, Stocks gapping up or down 3%, stocks outside of technical ranges, stocks under $60 with tight spreads.
c) Remember the key is to improve your stock selection each day, not expect trade selection greatness tomorrow.
d) Spencer offers a generous look into his stock selection process.

Safe travels back to Sweden. And trade well!

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Stock selection and game planning

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