WhisperfromWallStreet.com 9:45 Pullback Trading lesson

Good Morning all,

Wow!!!

My alert from last night ICRD sure opened well today. The stock has a high of .14 cents so far today which is a price gain of 100%.

This is the perfect time to talk about a trading lesson. Please learn this and keep it in mind as you trade my picks.

Its called the 9:45 pullback and it happens almost like clock work on all stocks that open strong. Did you notice on our stock this morning the stock went straight up from the open till about 9:50? Then the stock began to pull back.  Here is what happens.  Market makers are often caught off guard on a stock that opens strong.  They are in the business of filling orders for their clients who are the brokerage firms who have placed orders with them on behalf of their retail clients.(you) During a quick run up like this the market makers are often caught short. This is a short position caused by filling orders to their clients and typically not a short because they have an ax to grind with the company and think its going lower. What happens is these market makers earn their living
filling orders for their client firms.

They want to give their client firms the best executions possible so that they continue to come back and leave orders with them so even if they don’t have
stock in hand to sell them they do so anyways to keep their client happy. Sooner or later these market makers need to cover their short position created in this early morning run up so what they tend to do about 9:45 or so is begin to lean on the stock a bit.

This causes the run to slow down and even reverse. For example in our stock this morning this happened when they stock hit .14 cents. Lets say for example that a market maker was short 100,000 shares at an average price of .12 cents. He wants to do what he can to cover his short position lower than .12 cents so he can break even or make a few bucks. Well when they lean on it and it heads lower this will often shake out what we call the weak hands. These are the people who don’t have the stomach to watch a down turn and end up puking their stock up to the market makers. Did you notice how the market makers took our stock down from .14 to .11 cents? Many people probably thought this was the end and sold their positions to the eagerly awaiting market maker who was short at .12 and needed to cover. Once the market makers have covered their short they usually let it breath again and the stock heads back up. The 9:45 pullback often lasts about 15-20 minutes.

What we need to watch after this pullback is if the market makers have shaken everyone to the point that the buying slows down so much that it wont get back to its highs. If this appears to be the case you may want to take your money and run. The more you trade these stocks the better the feel you will get for this and it will become a valuable tool for you.

I hope you found this helpful. Please drop me a note at info@whisperfromwallstreet.com and let me know if you would like me to include more trading tactics like this from time to time. As always never be afraid to ask me any questions you may have about trading or any stock you may be in. I will do the best I can to
help you.

Good Investing,

WhisperfromWallStreet.com