Okay, so a few weeks ago when Uavs was trading at 156 and had just started its run, we had called it out in our Top Penny Stocks video for hype around their new drone program, then reiterated it a few days later when it ran up to 198.. we also tweeted about it and retweeted about it and blah blah blah. Who cares, that's not the point. Point is that this was a play that ran up from 156 to 392 which is a 150 percent gain.

And of course, when I say this is a 150 gain, I'm just saying the stock itself. Because we as traders, we don't claim to be able to take all of the move all the time. We can't We take most of the move most of the time and that's the goal of being a trader. In fact, even if you held without a plan and held through validation points many different validation points to get to the current trading price, you'd still be at over three dollars.

But anyways, the question now becomes: how did we find this play? Is there more opportunity for this run and what is happening with it now? This video is extremely important because it's actually going to get into the due diligence and actually teach you how to play these. The reason that I'm making this video is because I tend to get a lot of praise from folks for my winning callouts, but I often don't get any criticism at all for ones that don't work out. Of course, this isn't something that I'm necessarily really upset about, but what I do worry about is people thinking that they could just buy my picks because some of them work out like this. They think that they can just buy all of them and not do any of their due diligence.

Just because you could get away with buying one or two of them without doing due diligence does not mean that you're going to get away with doing that over the long run. So yeah, sure, we called out Uavs. I presented my due diligence on it, and I explained what scenarios needed to happen to take a position. Those scenarios happened and it worked out.

But what would happen if you were just buying these picks randomly? How would you be able to catch this play in Uavs while also avoiding a play like Azn, which actually ended up selling off more than 10 percent after we called it out? Do you see the problem with this? How are you able to manage the opportunity with this call out while also managing the risk of another call out? And the answer lies in actually understanding how to trade setups, how to identify setups, and have the mechanics of entries and exits at hand, and of course, doing your own due diligence. The missing link in terms of finding consistent profitability trading these setups is you. You're the missing link. It's your due diligence.

It's your risk management. It's your acknowledgement of good versus bad setups. That's why this video is so important. and that's why you're going to screw up if you don't watch this video.

So to be clear in this short video, I'm going to break down how the due diligence was done on Uavs, how we actually trade these, and the opportunities in Uavs going forward. And by the way, these penny stock plays are some of the most aggressive in the stock market, and I often recommend that new traders just completely avoid these when they're still getting their feet wet. Oversold overreaction plays like we talked about last week in the Hidden Opportunity video. Those are going to be some of the best for new traders who are just getting their feet wet, but for those who aren't faint of heart and are ready to manage the risk and understand what goes into trading stuff like this.

Well, these penny stock Catalyst Plays can be a great complement to your trading. Okay, so quick recap. Uavs was a penny stock that we started talking about specifically because there were rumors that they were partnering with Amazon on a drone package delivery program. The company decided to locate their headquarters in Wichita, Kansas right around the time that Amazon located a new warehouse in Wichita, Kansas and right around the time where Amazon is working on a drone program.

And the reason that this caught my attention was because it appeared that the Ceo was trying to play into these rumors. He said that Uavs will be contracting commercial drone work with a major e-commerce company major e-commerce company in Wichita, Kansas, right around the time where Amazon located in Wichita, and right around the time where Amazon's looking to get its drone program off the ground. Huh? Coinkydink? If nothing else, it was apparent that the Ceo was willing to use this perhaps coincidence to lure investors into speculating and causing Uavs to run up. Oftentimes Ceos slyly do this, and then once the share price has run up, they issue a direct offering at the higher price, essentially allowing the company to profit off the run-up.

But I digress. Anyways, at the time of making that video where I talked about this, originally, I was leaning towards Uavs being just an opportunist company that was playing the rumors, and that was fine because as traders, we just need hype to trade off of. But anyway, since the story has gotten out and since the story has blundered on, it's gone a little bit weirder. There has been pictures of drones delivering packages being tested in Wichita and if you zoom up close, it looks like they ripped off a logo in the shape of a wing and people are making the comparison to this and saying hey, Well, you know the Uavs logo has a similar looking wing structure.

But anyways, this is your typical hype play speculation and I'm just going to say it's still crazy. This in my book is still just hype at some point. hey, maybe a partnership deal will be announced, but right now, consider it complete hype, guilty, until proven innocent. The thing is, though, if Uavs is partnered with Amazon or in talks, they'd likely have a non-disclosure agreement.

In that case, it would explain why Uavs wouldn't just publicly come out with this info. But it's also true that it looks like Uavs is taking advantage of this, taking advantage of these circumstances to feed speculation and bolster their share prices. There's a famous quote that goes by the rumor and sell the news. And honestly, it's not really our job to analyze rumors.

it's really our job to acknowledge them and see if investors are reacting so that we can then go and trade off the hype. So going back to the lovely charts, any good trader would say, Okay, well, I acknowledge the potential for hyping based on the fundamentals based on the fundamental catalyst of these rumors, and then wait for the chart to react because we just we just know that they're rumors. So the rumors only matter to us if it actually makes the chart move. So you did your due diligence in terms of finding this and you see if the price action backs it up.

Now, there's multiple ways to attack this from a technical standpoint. The first way is the aggressive way, and that's through the intraday setup. With this, you're day trading it. That means you're executing into intraday elevating factors.

But what technical elevating factors make us buy in? What on the chart would make us buy in? Well, on this day, we have a break of direction right before open and Boom! we get a wild open with a confirmation of price strength. At this point, we are also in an upper direction. But it's not until we test the second upward direction over our red directional Sma line and then gain back into price strength that we have affirmed the setup. And at this point, here we have a confirmation of price strength in upward direction.

And as we go through the run, we have ascending volume. Combining that with our catalyst, we buy in a confirmation of price strength and ride out until validation. which is that break of the price strength blue Sma line. And that's how we profit off these intraday fluctuations.

And the thing is folks, even if you suck at analyzing charts and don't know elevating factors from your hands or your arms or your legs, at least, forcing yourself to buy in a confirmation and have a clear plan to exit, a validation will help you manage your capital. For example, buying in at this confirmation point here was obviously a bad idea. However, if you were holding to validation, it would have resulted in a small loss, but at least the majority of your capital would have been protected if it continued selling off. If it sells off, at least you know when to sell it.

If you just bought in when it's already below the Sma line, then it's all a guessing game as to where you're going to sell it. It's also worth noting that confirmations are only profitable when used to confirm already good setups, but they also help to protect you in bad positions. But anyways, if you are approaching this from not a day trading standpoint, but rather a swing trading standpoint, that means that you're looking to trade off a pre-anticipatory run type play. So in that case, you are choosing a farther out aggregation period to stretch multiple days and you're attacking it when it gets a high probability setup.

That's why aggregation periods are so important, because choosing the right aggregation period means you can literally just write this clean price strength over the Sma line to validation and then sell out. But it's crucial to understand how the charts and this catalyst come together because the charts tell you where to enter. But it's the fundamentals. it's the news that tells you why.

So following catalyst like this means doing your research and following the news. And recently, one of the ways that I've been keeping up to date with breaking news is by using Benzingo Pro. You literally just type in the ticker and you can see what's happening up to the minute that it happens. Which is very important if you're in these positions, because honestly, sometimes these news events can really just slap you in the face and you don't know what hit you.

but actually getting the news first gives you a little bit more of an edge in terms of managing that. I'll put the link below. They do have a free trial and it's worth checking out if you are struggling to keep up with the news. but if you are industrious and determined enough, you can rough it out and find ways to do these things yourself without paying the little fees.

Fees do add up and we are cheap as traders, so I'm totally on board with that. It's just that it depends where you are in your trading career. If you're somebody who's been trading and you're making consistent profits, something like Benzene Pro is probably going to speed up the process quite a bit. But anyways, let me give you some tips on how to actually do your due diligence without using any of these premium services.

So one of the first things that I do. It's a little bit unconventional, but one of the first things I do is I go to Google Trends and I type in a ticker that I'm finding interest on, and in this case, we're going to do Uavs. This is an obvious parameter for interest because if more people are googling a certain ticker, that means that more people are interested in it in those given times. So we see a huge rise in interest during this period.

and we see a huge rise in interest during this later period. And if you break out the chart for the actual stock market, you could see the interest earlier in the year correlated with this rise. So we can make the extension that the more people that are watching Uavs, the more people are waiting on the side for more hype and the more potential we have if rumors start spreading like wildfire. So this is my first part of due diligence in terms of height plays.

and that just means going and finding and identifying height. And we've identified height. Secondly, what I also like to do and this is actually one of the most important things is going and doing a simple Google news search for the ticker. That means just literally typing the ticker into google news.

I'll go through and then I'll go through the press releases and see if any major news events are happening. And this is how I came across the articles that dive into rumors and fuel the speculation. That's how I came across this position. It's just by going through the press releases, you can also go through price targets.

You can go to the websites, you can go through Google addresses, but the key is just finding substantial evidence of speculation and then forming a hypothesis that says hey, maybe Uavs is going to run up on rumors and then you set alerts or you watch you Avs's chart for confirmation of that. You want proof and not promises. But it's also true that this is not just watching the price and waiting for it to move. You know what else happens when you have a huge influx of people buying rumors? Well, we see a spike in volume.

So the secret sauce here, folks is managing your position, keeping up with news, having concrete entries and exits, and having the mindset of taking most of the move most of the time. Practically speaking, this means having the skill set available to understand what elevating factors are motivating this run, and hey, what deprecating factors are motivating this to turn around. But success trading these hype stocks also means having the humility to admit that we can't completely catch the top and we can't completely catch the bottom. We have to let that go.

Our goal as traders is to take most of the move most of the time, and we can do that by following concrete entries and having actual elevating factors that motivate us to take those concrete entries. The moral of the story is, choose your luck, choose the setups that have probability in your favor, and control your risk for when that falls through. Anyways, folks, if you have any questions, feel free to reach out to us in the comments section below. Make sure to join us on Zip Trader Circle for a free nightly watch list.

and if you're wondering what broker, what broker should you be trading these stocks on, we always like to send new traders over to Weeble. You will get two free stocks when you both sign up and deposit using our link below. but it's a great platform. They have great features such as earnings calendars.

They have really great scanning capabilities um, what else do they have? They have after hours runners, pre-market scanners, and stuff of that nature. It's a really great platform and you also have your after hours in pre-market trading which a lot of other platforms don't let you do and a lot of the movement happens in the the pre-market in the after hours, so you might as well have that feature so you can take advantage of it and also protect yourself when the market turns against you. And lastly, if you are looking to learn how to trade if you want to be forged into a trader, we are offering 50 off if you type in Stay Home 2020 before checkout and that link is in the description below. Anyways, folks, have a great day and I'll see you in the next video.

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