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How to Profit When Stocks Go Down

In the current stock market environment where stocks and index funds are falling, does that mean you can only lose money? Absolutely not! When you are new to trading and trying to learn how to trade, you may not be aware of the fact that, as oddly as it sounds, you can make money when a stock price goes down. I go over some real life examples showing the power of knowledge and understanding how to “short the market”.

Small Risk but a 75% Reward Turning $400 into $29,000 How to Make Money When Markets Go Down Fool’s Gold Disappearing 128% Boom for Members Taking a $3,600 Loss (Life Happens!)

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Transcript:

Hey, it's Clay at ClayTrader.com.This will be the weekly reviewof the Power Profit Scan newsletterwhich comes as a componentof the Inner Circle subscription servicethat I offer here at the site.I just wanna do this and I've been doing itto give you a little idea of what you will get,and then we can mix in some education which is my goal also,then that just hopefully will benefit everybody.Couple quick disclosures as always,first, am I trying to implythat every single alert that I make,that every single setupthat I send out is a winner?Absolutely not.In fact if you've watched past videos,then you would know I have shown losers,you would know I've shown onesthat really just don't play outin a smooth type of fashion,so I'm not trying to come acrosslike anything as perfect,but the one thing to keep in mindand the educational aspect here is that,yeah nobody's perfect, nothing is perfect,so losses are gonna happen,bad trades are gonna happen,but that's why risk management,risk control is so importantbecause when the bad trades happen,you don't want them to spin out of control.But sure bad trades happen,but good trades,winning trades also happen,and when those do occur,that's why you wanna make sure your accountis in a proper fashion where you can benefit,and then over the long haul let your account grow and growbecause you're very solid in the risk management department.Second disclaimer here is that we are going back awhileto look at the week of 11/12 of 18.Why are you going back so far?Two reasons, first off,it's just giving the charts and everythingplenty of time to play out so we can see what has happened,and then on top of that, it's just a matter of being fair.The last thing I would assume you would want isto pay for something and then all of a suddenyou see it out in public for free when you just paid for it.So just a matter of being fair to members.So before we go any further,I wanna establish a little context here.And this article came out very recently,and when I was glancing through it,I just thought, oh you know thatI think this would be a great jobto establish some context here.So it's from CNBC and this is Jim Cramer here.If you're not familiar with him,he's the guy on CNBC that has the Mad Money show,that's yelling and all that sort of stuff.And he threw out this comment and I thought,alright, well, I think I wanna use this becauseboy oh boy does it offer a whole lot of context.So right here he said that,"I," I as in Jim Cramer,"bought some 3.5% CDs,"CD standing for certificate of deposits, "yesterday."So Jim Cramer has bought a CD and he says what,"I feel pretty good."Okay that's fine, I'm not judging."They're out five years,"so a five-year CD he's gonna get 3.5% on.Just keep that in mind, five years, 3.5%.Couple quick FYIs just if you're interestedin maybe the service as far as prices,hey Clay, what sort of stocks do you alert?Just keep an eye on the prices that we cover.We're starting off with as you see here, a sub $5 stock,but we'll cover other prices too.And then also this is the newsletterthat I sent out over the weekend.So what you see here is the chart going into the weekend,and then as we start to see the price action play out,that'll be the following week and beyond.So the first alert here, NVLN,and I threw it in a Panic Play category.And what I'm proud about here is,and this will mean a little bit more to youmaybe if you've been in other chat rooms,especially those ones that are free and stuff like that,but a stock can go up and up and up,and all people keep saying isthis is the greatest thing ever by by by,and that's not really a smart way to go about trading,that's a great way to cause chasing,which is not a good habit.But here pulled this up,and implied that yeah,there may be some panic,there may be a pullback that is coming.And then I focused more soright around here on the dollar level.So let's see how this one played out.But yeah definitely by no means any sortof pumping or hoopla or anything like thatwhere you would get people to be buying up here'cause as you're about to seethat would not have been a very good entry point.So here is the chart again going into the weekend,and then the next day you'll see will be that Mondayand then the following days to come.So right there the pullback does indeed occur.And right there you can see the price dropsbeautifully down to that area that I was talking about,and then got a bounce back upwards.Now I realized that it doesn't seem like much,but when you're talking about a dollar stockand it went up to a $1.15,that was a 15% move in essentially a day,a day and a half.I get it, yes, I know, 15%, it's not like,I'm even guilty of this,it's not like some of the past oneswhere there's been a 200, 300% winner,but still what was Jim Cramer happy about?3.5% in five years, and here you had a chance at 15%.Let's just say you played it really badand maybe you only got 5% off it,you got 5% so you still got more than Jim Cramerin a matter of basically a daycompared to 3.5% over five years.And that's again playing it really really badwhere you butchered it.So yeah perspective.A nice little move here especially when youfactor in the amount of time that it happened in,and you could have made some quick change from it.And I know there were some people in the chat roomthat were saying, hey Clay, good call,it bounced right off that dollar mark which it did.Unfortunately it didn't get much follow throughbut still 15%.This next alert here wasin the History Repeat category,ticker symbol NBEV.I just made a comment about how the previous timesit's been down or on that green area,there have been some good solid bounces from it.And then I also pointed out,the 200-day simple moving average down hereas a key area on the chart,and one from a risk management perspectivewhich were definitely playing as far as stop-lossand all that is concerned.So here's the chart going into the weekend,let's see how this played out.So definitely a couple of potentialsfor entry points right there.I'm assuming that you got in more,so up here I'm not gonna placesomething like best case scenariowhere you nailed the bond or anything like that.But you can see it did pull back, sure,but never violated that 200-daywhich is definitely criticalfrom a risk management perspective.If you have no idea why that would be the case,then that's okay, I'm just saying that's probablya sign that you had some holes in your understandingof how to go about the market.But you can see right there,it made a nice recovery,and then hit a high right therewhich was good for 25%.Did pull back here a little bit.So I'm assuming that that would have taken you out,maybe it didn't, there's plenty of scenarioswhere this little pullback movewould not have taken you out of the trade.And if you had actually stayed in,then yeah actually the thing justhas continued to chug upwards,and it's now trying to break through seven,but regardless even this little move right herewas a profit potential window of 25%.We'll go with yeah you didn't play very well,maybe you screwed up half the trade so you got 12 1/2%.Still 12 1/2% in a matter of three or four dayscompared to 3.5% in five years.Wow, perspective is powerful.Now I wanna hop back over to another comment here,and I do read the comments on YouTubeand the website that you leave,and a lot of people enjoy seeingkind of the shortsighted trades here.But just quick what is shorting?Shorting is when you make profitsfrom prices going down.And I wanted to focus on this once againis because in the market as of the recording,things have been getting pretty nasty,markets have been falling,stocks have been falling,but even in these situations,you can still actually make money,because, yes, when prices go down,you can profit from that,and that is called shorting.So as part of the newsletter,you do have some alerts that I send outvia just down here,but you may then, well, Clay,where's the actual chart at?Where's the annotations?Well, this is for why I specifically saystudents of the course that I offer on shorting,Shorting for Profit is the name of it,because once you have knowledge,then you know what to do,you know where to take that ticker symbol,you know how to analyze the chart,and you know how to structure a trade plan.So that's why there aren't any chartsbecause these people flat outhave invested into their knowledgeand they know how to take that ticker symboland then start to analyze the chart from it.So let's look at, I wanna go over all three'cause it does a good example of just showinga more so realistic side of trading.But also remember the current market atmosphereright now is quite bearish,and there is still ways to make money from it.As a quick reminder prices going down is good,prices going up is bad because from a shorting side,when prices go up, that's how you actually lose money.So in this situation a little,maybe your brain is a little, what,we wanna see prices go down?Yes, I get it, it's weird at first,but you wanna see prices go down.So here you can see there's Monday,a little bit of upwards movement.And then the price does go down thereand then quickly rebounds.So this is one of these where I could seemaybe people making some money from it,but it was not smooth.And earlier I made a comment aboutI don't wanna come across like every alert that I makeis perfectly smooth like you're about to see,but sometimes these happen,and yeah, I mean, it went down,but it went down in kind of a goofy fashionand then it quickly rebounded back up.So I could see a variety of situations,I could see just a breakeven trade,I could see some sort of a winning trade,I could see a small loss trade.So yeah a big varietyso I'm not gonna call this a winner at all,but I'm also not gonna call it a loser,or because there's just a lot of gray area,hence the part about not everything is always smooth.Now let's go take a look at the NVTA chart.So let's see how this one played out.Again prices going down is a good thing.So went sideways a little bit,plenty of opportunity for peopleto potentially get in.Showed some weakness thereand dropped a little bit more,but again kind of a goofy one,that move right there was good for 5.4%.And I bring up that number 'cause yeah it was goofy,it was definitely smoother though.It got a move downwards, came back up,did actually pull back here,so still not as smooth as possible,but enough where I would say comfortable.Yeah, you had some wiggle room to work with there,and yeah 5.4%, but again what was that numberthat Jim Cramer is happy with?3.5% in five years,and here is an opportunity at 5%in a matter of literally just basically a week.And then the final one we'll look at hereis ticker symbol KTOS.So here is the chart going into the weekend.Let's see how things played out.Again falling price is a good thing.So right there.Goes sideways for a little bit.Shows a false green move right there,and then look at this thing,just completely collapsed,but no, it's not done yet,it rolls back over that much more,and finally at that low point right there,that was a move good for 19.6%.Again nothing massive massive,but still let's say you only got 10% from it,10% in a matter of about three weeks.So 10% in three weeks compared to 3.5% in five years.And finally I wanted to go back toan alert I made on ECA from the Scan,and it was just simply in the Technical Pattern category.And the Technical Pattern being a sideways channel.Now it was kind of ambiguous, just I'm at the channel,but the point here is when you have knowledge,you have power,and when you have full knowledgeand you do understand how to shortand make prices from moneywhen prices go down,then it really expands your opportunity,you ability to pull profits from the market,'cause as you're about to see,I'll do a little spoiler alert right here,there was really no long opportunity.The price never did break outto the upside of the channel.'Cause right now yeah,it was maybe some sort of bottom here,but you needed some sort of confirmationand a good starting point for a confirmationwould be a breakout from the bottom,which again you're not gonna see.However something else happenedwhich again circles back to my pointwhen you have knowledge,when you have all the tools in your tool belt,there's opportunities to still make money.So there is the sideways channel,and let's see what happens.You know that it doesn't break out to the upside.Right there it partially does,and then you get this nasty red candle,and then it breaks to the downside of the pattern,or in technical jargon, a pattern breakdown,not breakout but a breakdown.And again with the concept of thinking going short,making money from prices going down,I'm just gonna speed this up,but I mean check out that catastrophe,and therefore profitable opportunity from the short side.It just has continued to drift down.The other quick exampleis this is why you wanna be disciplined forif you did get in around here for whatever reason,cut your losses, this is why you wanna cut your losses,'cause can you imagine still being in here,and then with the price driftingfurther and further downand it just continues.And right now as of now, 34.2%,that's up to date real-time.So who knows if thingis gonna continue on down,but that's 30%.Let's say, I don't know,you pressed the wrong buttonand you only got let's say 15% out of this,so again you screwed up half the trade,15% within a matter of a month,that's not too bad when you compare it tosomebody being happy about 3.5% for five years.But here is just another exampleof a good shortsighted breakdownand how money can be made when prices fall.Now if you are interested in signing upand getting this newsletter,again the Power Profit Scanpart of The Inner Circle membership,along with the membershipyou also get access to the Live Trading Chat Room,which probably gets more talk than anything else,which is why I wanted to do these videosto make sure people are awarethat you actually get a newsletter too.So these are all the benefits here.There's also a mobile app,so it's not like you have to stay chained to your computer,you can stay in touch anytime you wantand from anywhere you want,and that comes with no additional costor anything like that.So again you can just go to ClayTrader.com /innercircle,or just go to ClayTrader.comand there's a little sectionfor the inner circle.As far as the cost,$99 per year,not per week,not per quarter,not per month,per year.If you do the math, that breaks down to $8.25 per month,or if you wanna break down the math further, $1.90 per week.So what do you spend $1.90 on per weekthat maybe if you just cut out,then all of a sudden here you go,you can afford the subscription there.So more than fair as far as price is concerned.And as I say every week and I'm gonna continue to sayI am very very confidentthat over the time spend of 12 months,you'll get at least $99 worth of value.If there are any other questions,leave them in the Comments section below,or reach out to me whether that be on social media,through the website, whatever is the easiest on your part,and I will do my best to answer any questions you have.But yeah, hope you decide to join us.

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