Monday and Tuesday of this week proved to be solid trading days for my portfolio. Over the weekend reports that the swine flu in Mexico caused huuuuge hype in the markets, particular all the swine flu penny stocks. I knew going into the Monday’s trading day that I wanted to buy one of these speculative penny stock plays after seeing how they’ve reacted in the past, but I wasn’t willing to buy one at the pre-market prices, as most of the penny stocks in the biotech sector were up 80%,90%,100%+.

So I brought up my watch list of potential swine flu penny stocks and thought of my game plan. It was pretty simple: I figured that I would buy the penny stock that was up the least amount of % in the watch list. Make’s sense right? Well the lucky winner was penny stock NNVC.OB. To make things even better, this company released a PR that same morning that specifically mentioned “swine flu” in it. Now there was 2 important reasons why I knew this stock could really potentially make me some money.

1) This stock was only up 30% pre-market according to the bid/ask (remember penny stocks trading on the OTCBB exchange don’t have pre-market buying/selling BUT they do print the bid/ask before the market opens –effectively the same thing except no shares are actually trading hands during this time). Other penny stocks were up over 100%+, so I figured that NNVC definitely had room to run especially considering it was already way behind compared to other penny stocks in its sector.

2) The PR they released that morning before the market open specifically mentioned “Swine Flu” in it. Now this was huge because none of the Biotech swine flu stocks, even those that were up 100%+, had a PR that mentioned “swine flu”.

As the market opened I put in my order for 3350 shares @ 1.04. I immediately got 1800 shares filled but then this thing took off skipping over the rest of my shares. Unfortunately I got the rest of my shares filled at 1.12 thus giving me an average of 3350 shares at 1.08. You gotta be quick!

Ended up going to 1.25 before some profit taking took place, causing it to drop down…then seeing that the other biotech penny stocks were dropping I got scared and sold my shares at 1.18. Shoulda sold some at 1.25 as I was too greedy and wanted more, but on the same token I’m glad I got scared and sold at 1.18 because you can see in the chart below where it closed..Solid $335 profit, though.

Now lets head on to yesterday (Tuesday) when in my premarket watchlist I said that DDRX was my top potential short. This penny stock opened up green but stalled for the first 10 minutes of the open. I knew that it might be the turning point for this sucker to go red on the day. Sure enough 5 minutes later the stock went into negative aka showed the weakness I wanted for this to make it a great short. I have never seen a penny stock drop so fast, I literally went to my brokerage to enter the short order and this thing had already dropped 7%. I finally got my order filled for 476 shares short @ 7.34. Wounded up going down to 7.00 in the next 5 minutes but I wanted more. At this point it was just going to be toughing out a short squeeze that I figured wouldn’t go too far considering the stock was now on our side (the short seller’s). I went to math class around 2 to take a test, that I think I made a 100 on, wooohoooo! Came back and planned on selling this sucker by the close because I just didn’t like the spread between the bid/ask and the sideways price action all coupled around the fact that this was a earnings play that may not give me fast negative move like I want. I wound up covering my shares at 3.85 for a cool $227 off of a perfect green-to-red move that I fully detail in my FREE eBook. I really think this penny stock would be a good hold for a week or two because of the total unsustainable run up this penny stock has gotten. But the patience that I have (An 18 year old) just isn’t there yet!

Last 5 posts by Justin Bostwick

• SEC Charges 8 - May 23rd, 2009
• 6 More Penny Stocks Picks: “Buy The Hype, Sell The News” - May 22nd, 2009
• Penny Stocks To Watch For Friday The 15th - May 15th, 2009
• Six Penny Stocks To Watch That Could Make You Money - May 12th, 2009
• The Framework Of An Afternoon Fade And Why It’s So Essential To Short Selling Penny Stocks - May 7th, 2009