This is another amazing strategy for shorting penny stocks. It was a strategy that was introduced by Muddy from DarkSideTrading. This strategy is diferent from The Pump, in that this strategy is looking for stocks that show some strength on an intra-day level rather than a multi-day level therefore we're solely using a 5-min chart for this strategy. We're looking for penny stocks that increase 7% or more in the frst few minutes or hours of a trading day, then on the same day go red i.e. give up those gains and go into negative on the day. What you want to do is short when the stock goes at least below -3% on the day. Sure you could short the second it goes red, but this just gives us a little more confrmation of the trend. Lets look at some examples..
