In THIS morning’s watchlist, when I said about Taylor Devices, Inc. (TAYD) “this thing is gonna tank, it’s my #1 potential short”

I knew I had to reserve shares early…7:40am. Done.

After I shorted 1,000 shares right near the market open at $8.13ish, I sent out this alert to TIMalert subscribers:

one of the simplest plays in a while, earthquake absorption equipment maker always goes up on natural disasters–people get excited about possible deals–hurricane gustav wasnt that bad, sadly–this thing should go back down…read my book An American Hedge Fund–and see I once made over $200,000 shorting this same stock after the Asian tsunami, not much has changed since then except i’m more conservative…goal is to cover under 7.50 in the next 1-2 days, not a huge profit cuz it wasn’t up enough

Unfortunately, since it was a morning dump, it tanked rather quickly to my target area of $7.50 and very few subscribers actually got in—luckily there a little bounce to the $7.70-$7.80 area, but that’s it.

Considering the stock was only up from the low $6s—and yes, even though it’s an earthquake, not hurricane play, its got a proven track record of spiking during natural disasters—as I detail in my book An American Hedge Fund. So, I took my profit and sent out this alert to TIMalert subscribers:

i held the stock just inside of 1 hour…sorry the morning dip happened so fast, but thats usually the pattern in the morning as opposed to the afternoon…especially when the main catalyst for the stock’s surge disappears, literally overnight…i dunno what idiots bought this morning, but they haven’t been keeping up with what a failure hurricane gustav is….further downside probable–but i wouldnt guess more than 50 cents/share max in the next 1-2 days aka not worth my time, but i went in with a goal in mind and i took that goal so i’m out…this was a solid 8%ish profit, made just over $600, puts me solidly past the $25k mark, now at $25,921, up 109% since november 2007

As it turned out, I was dead on in my thinking, had a great entry, horrible exit—there wasn’t just 50 cents more downside, but $1+/share within 2 hours….so I left $1,000 in profits on the table…but I’ve never been one to time TAYD very well—am getting better as evidenced by my lack of a $180,000 loss this time around before the gain!

The even better news is TIMalert subscribers have gotten accustomed to my poor timing—yes, my 109% return in the last 9 months really is worst case scenario—so they had much more patience and some really banked:

$190ish profits after commissions
-GS

Just covered my TAYD short for $560 profit.
This was my first TIMAlert.
-mapiguy

I’m a bad Jew who needs to go to synagogue this weekend to learn how to be greedier on these kinds of plays that surge based on short-term catalysts that come and go quickly. Seriously.

Stock up 700% in 1 month + shitty earnings = inevitable bigtime tank

I knew entering my short ahead of earnings was risky, as I wrote in this TIMalert sent to subscribers when the stock was at $3.30:

yes the volume has faded, yes its finally red on the day, yes, it just took out the day low, but this is dangerous with earnings coming out tomorrow. i prefer to live dangerously. but that’s just me. no idea how long i’ll hold, could be 1 hour, 1 day, 1 week, i am aiming for a crack ofyesterday’s lows as that would make me feel very comfortable holding overnight, but we’ll see…the key is to judge these plays by price action, enter when you’re comfortable, exit when you’re not, always try to minimize losses.

…but that risk paid off

…which is the definition of a good trade: understanding one’s risk…Personally, I didn’t think it would collapse so quickly–most don’t, but my last 2 TIMalert shorts on USS and MKTY (see how they fared HERE) prove the current market environment loves punishing these turds–so when I covered into the morning panic at $2.66 for a $1,200 gain (5 minutes later stock was at $2.20ish…right now it’s sitting at $1.80…blehhhhh $1,500 profits left on the table) but I just wanted to get over $25k) pushing my tiny TIM account over the key–at least according to Osama bin SEC (see explanation HERE)–$25,000 threshold to $25,716, up 9% on the month, 107% since I started this quest back in November 2007. Which I do have to mention crushes ANY return of ANY newsletter writer/gruru/expert–percent-wise–especially considering all my trades are verified by Covestor, all trades are detailed HERE and I’ve made plenty of mistakes along the way aka haters got nothinnnnnnn!

PS Haters, learn to attack you’re opponent when he’s down, not when he’s just made his single greatest call to-date and has these ridiculously amazing TIMalert testimonials (see all the rest from previous alerts HERE) below to back him up and drown out the small losses–think average loss of $100–when he was too early with his short the first time around:

I’ve got other things I need to do. I closed my last APII shorts. Total profit: $3267.55.
-Reaper

Tim you made $1000 in roughly 45 minutes of the market open!
-Plombardo

8/13:

5PM News comes out about APII’s latest acquisition, see PR HERE, basically for 500k restricted shares or approximately $1.5 million…I dunno how to interpret this, all I can think about is how this news makes APII’s 700% runup reek even more of manipulation–since the deal is definitely being pushed forward fast (close by end of August?!?!?) to take advantage of these inflated prices…and considering the stock has been dead for years–and is probly related to this acquisition somehow aka some “unrelated” third party gets the price up in order to dole out less shares to this new company they’re acquiring…color me cynical, I’ve seen it happen too many times.

4:30PM: Chart is so beautiful, it brings a tear to the eyes of short sellers everywhere, as we practically KNOW it’s the beginning of a massive reversal:

4:30PM Bid $2.91 Ask $3 Big sellers everywhere, longs scareddddddd, subscribers lovin’ TIMalerts again! I fully expect a drop to the $2.60-$2.80 range tomorrow, maybe even lower, not even sure I need to cover right away considering this stock is up from 50 cents in 1 month and these earnings are bankruptcy-type stuff. Disaster potential aside, this is the first down day, pattern is a near lock to short into, especially with this negative news pressuring bitter longterm shareholders who will be clamoring to take some off the table ASAP.

4:16PM Earnings news hits screens: APII Action Products reports qtr ended June 30 EPS of ($0.18) vs ($0.05) a year ago; revs declined 21% YoY to $1.16 mln (3.19 -0.25)

4:05PM First TIMalert two testimonials of the new trade (notice gains swallow previous losses):

Profit of $378. Realized profit on the day of $70. I still have 2100 shares short. - Reaper

$340 profit!! haha yes!
-sorin

3:46PM APII reports laughably horrid earnings, revenues down 20%+, expenses up, current assets of $4.2m vs. current liabilities of $3.1m, all of which you can laugh at HERE…whewwwwwww!

1:30-3:30pm Stock has dipped to the same $3.10-$3.20 range, even to the low $3.30s, but buyers always fizzle and big sell blocks gradually become more aggressive…very happy holding my short with this price action.

1:32PM As I see big block sells pushing the bids down, I reshort 2,000 at $3.30 this time around, sending out this TIMalert:

yes the volume has faded, yes its finally red on the day, yes, it just took out the day low, but this is dangerous with earnings coming out tomorrow. i prefer to live dangerously. but that’s just me. no idea how long i’ll hold, could be 1 hour, 1 day, 1 week, i am aiming for a crack ofyesterday’s lows as that would make me feel very comfortable holding overnight, but we’ll see…the key is to judge these plays by price action, enter when you’re comfortable, exit when you’re not, always try to minimize losses.

Morning: APII jumps a bit back to the $3.40-$3.50 range, but volume is waaaay down and never really has a shot considering all the big block sells above

8/12:

All night: lots of talk whether I “pumped and dumped” this stock, somehow I don’t see it, I thought it was the top, was proven wrong–albeit slightly–covered for small gain in order to live to fight another day…

4pmish: Lots of testimonials–most small losses, which I proudly display here cuz trading isn’t about being perfect, it’s about minimizing risk/losses:

I covered for a $44 gain.
-Reaper

shorted at 3.2 covered at 3.3…lost $100, be sure to add that to your testimonials Tim If I hadn’t had to call in to AMTD would have made a couple bucks…
-BTB

Lost $38 with commissions
-evan

just under a $100 loss after commissions for me
-YG

$135 loss for me. My entry was bad.
-TP

4PM: Stock squeezes into the close $3.40ish

1-3:30pm: APII has dropped a bit to the $3.10-$3.20 range, but it’s still up big on the day, so I decide to play it safe, covering at $3.25, sending out alert that I covered at $3.25 for $300ish profit with 30 minutes to go before market close

1:05pm: After waiting for a wall of sellers and seeing the bids cracking a bit, I shorted and a TIMalert goes out saying I shorted 2,000 APII at $3.40

12:34pm: I alert subscribers to potential trade, shorting APII, here’s my reasoning:

understand i havent shorted yet, the price action hasnt broken down today…yet…in fact its trying to breakout very gradually….so theres a risk of a big squeeze later today/tomorrow…here’s my research to get us prepared:

long story short, i’m just stalking it, infinitely better to short AFTER a short squeeze has occurred

Yesterday, he wrote THIS crazy post about Amedisys filled with juicy enemy-creating tidbits like this:

Citron has been interviewing Amedisys’s former employees in an attempt to confirm or disprove the implications of these accounting red flags. (All of the interviews conducted were done by a licensed private investigator who asked a standardized series of questions to former employees. The interviewees did not know why they were being asked the questions, nor did any of them have a position in the stock.

According to one former management employee, who left the company in 2008 and was interviewed on August 4th : “Our old receivables were real high and were a real mess. But no one at corporate would let us try and straighten up the mess. The billing system is set up for failure and there are no checks and balances. “

I encourage you to read the whole thing because that one post knocked a few hundred million dollars off AMED’s previously just under $2 billion valuation. Impressive work, good job Left, hope you’re ready for the inevitable backlash (Since I deal in penny stocks so I’m not about to do that kind of digging as I value my life/legs)

Of course, ANALysts were quick to dismiss this:

Oppenheimer defends AMED; believes the Citron report is irresponsible in its innuendos of an underlying problem at AMED,
Oppenheimer notes that they reviewed a report on AMED by Citron Research. Firm says the report primarily questions the co’s accounting for receivables and its ability to generate greater internal growth than its peers. After speaking to mgmt and analyzing the supporting details of the report, they believe the report is irresponsible in its innuendos of an underlying problem at Amedisys. Furthermore, they believe the stock’s reaction to the report is significantly overblown. While clearly this will present an overhang in the short term, when the dust settles they believe the stock will offer a compelling buying opportunity.

But wait, there’s even more ANALyst rescue attempting…now we get this word:

14:38 AMED AMEDISYS: Hearing AMED upgraded to Buy at Wachovia intraday (51.19 -3.02) -Update-

Now I have no opinion/position on this cuz it’s not my specialty–see that wasn’t so hard, why can’t more finance freaks say that?–but if I were forced to choose, I’d pick Left because a.) his track record and b.) he’s not part of the corrupt Wall Street system where ANALysts must protect investment banker/fund manager interests/investments.

Who do you believe?

More importantly, looking at my performance data below, aka how you would’ve performed if you’d been following my strategy/picks/trades, (yes, those outrageous numbers are due to me taking only 1 position at a time, aka Covestor treats it as 100% cash used per trade, when in reality it’s 20-40%..Covestor is making me think I should be more aggressive!) it’s understandable why you can’t wait for Covestor to unveil their “autotrade” feature, but these kinds of ridiculous gains ain’t gonna be easy for you to achieve.

For better or worse, I owe much of the success of my strategy (you can see all my trades HERE)(which you can learn to do on your own through my ridiculously well-received PStocking instructional DVD package, learn more + read reviews HERE and don’t be so fat and lazy to have to rely on me anymore) to short selling, which often requires the borrowing of shares to short ahead of time.

And of course there are scalability issues as ideal entries and exits–no matter how flawed my own personal trading has been–becomes problematic after you have a few million dollars.

Basically, autotrade will never work with my ideal strategy so your 2 options are to learn my strategy for yourself with that DVD mentioned above or subscribed to my TIMalerts real-time trade alerts service, which is basically what Covestor aims to do, but without the autotrade feature.

The good news is that since I know full well about these issues, TIMalerts main strength is the 8am morning watchlist emailed to you and posted on subscribers-only TIMalerts.com website. This allows subscribers to reserve shares early in the morning, before the brokers run out of shares to dole out, which sometimes happens with these perfect shorting opportunities.

Even better news is that out of 18 TIMalerts so far, all 18 of them have been winners (don’t expect perfection to continue) over the next 1-2 days, which is my usual trading timeframe. The average gain per alert in June was 18% and July we got all the way up to 24%, thanks to my latest 2 alerts on 47%-return-in-2-days U.S. Shipping Partners L.P. (USS) (click HERE to learn the details) and 30%-return-in-1-day Mechanical Technology Inc. (MKTY) (click HERE to learn the details).

And while the majority of my trades/alerts will be short sells, some have been buys (basically 2 shorts for every buy), so I’m going to create another Covestor account specifically for longs only (when my original account is large enough to be broken into 2).

I apologize my strategy isn’t easy to replicate, but that’s its gift and its curse–if it was so easy, everybody would be doing it and it wouldn’t work anymore. for now, the 300+ TIMalert subscribers are banking (read the testimonials on the TIMalerts table HERE) and even more importantly, there’s no one right way to play this game as it works over multiple time frames–check out THIS GUY whose adapted my strategy to be more of a longer term swing trading strategy.

Check out THIS new newspaper article that is just a basic summary of the risks and rewards involved with short selling and look at my quotes:

“It’s considered a speculative strategy for a reason because in the long run stocks do tend to go higher,” said Mr. Sykes, 27. “But on the other hand, more than 50 percent of stocks go down in a year regardless of what the market does. So it is a viable strategy in my mind.”

That’s a decent point, but how can you not get angry at comments like this:

“Short selling is not something I’d advocate for anyone who is not a professional trader,” said Michael Cohn, chief investment strategist for Atlantis Asset Management in New York. “I’d be more inclined to recommend shorting an index, as opposed to shorting individual stocks.”

Cohn you dumb motherf%^&#, I’d short your career before I’d ever short an index–scumbags like you make my job of teaching people basic friggin things like short selling harder so we can’t be friends.

Let me be very clear, Cohn & every other wannabe traders who’ve talked or written about short selling is focusing on shorting companies for fundamental reasons–everyone wants to be the next Chanos shorting Enron down to 0–but they ALL ignore short selling penny stocks, which are pretty much uniformly fraudulent.

Why is short selling fraudulent penny stocks such a revolutionary idea? It’s not. Finance people are just the most unimaginative, unoriginal pieces of sh$% in the world so you gotta thank God for them leaving this opportunity wide open.

So, be polite and leave a comment below thanking these dumbfu%^s we owe all our easy profits to their incompetence.

-these piece of crap companies can spike based on pathetic speculation and collapse just as quickly due to all the bitter longterm shareholders being scared/abused for so long

-gotta reserve shares to short early–TIMalert subscribers get my daily watchlist, filled with all my potential shorts, at 8am by email and on the subscribers-only website (click HERE to see my perfect TIMalerts track record) so it’s no surprise your poor/cheap folk reading this free website couldn’t find shares…welcome to my biz model bitches!

-the reversals are extremely predictable–as I’ve telegraphed a potential short the past 2 days in my premarket watchlists and as you see in this TIMalert that I sent out, I pretty much nailed the price action an hour before it happened–this was sent out at 1:20PM EST to TIMalert subscribers:

Shorted 1500 USS at $4.61…as i wrote in my premarket watchlists the past 2 days, USS was on my watchlist for a potential short, given the stock has a solid longterm downtrend, recent sideways action and fading volume, i think bitter shareholders take this spike to reduce their positions and i know lots of other short sellers are watching this for a quick breakdown too…key breakodwn level today appears to be the 4.60 area as its held several times and considering its still solidly up on the day, i’m taking a chance here, especially since this company benefits from lower oil prices…but i’m willing to add on the way up if need be as this is only a 2/3rd position…not sure if its real but somebody posted on the message boards, the NYSe asked the company for info and they said no comment so there is risk of news coming out too….given this company’s failings, chances are news is negative…so thats the good and bad, lets see how this pattern plays out, risk is it surges past previous high of $5, but if it takes out $4, it’s got no support until the low $3s…i basically just wanna cover in the low $4s in the next 1-2 days

-the key is waiting for fading action after sideways action–stock held $4.60 all morning, perfect afternoon fade/collapse after it broke

-I suck at trading–I covered this at $4.05 for a solid, if not spectacular, 12% gain inside of an hour, now it’s at $3.25, which coulda woulda shoulda been a 30% gain–the latest reason why my 87% return in the past 9 months now on TIM truly is worst case scenario

-Screw 90% of traders losing money, these patterns are so easy, even the dumbest people in the world can make money (yours truly!). Learn the friggin patterns yourself in my PennyStocking DVD package

-You want testimonials, You want testimonials? You can’t handle all my testimonials! Every day/week brings in dozens of new ones, I’m now 18 for 18 on my TIMalerts, average gain of 20% inside of 1-2 days, how you like these apples you ignorant haters…and yes, this is all from TIMalerts, a $30/month service where more and more people keep signing up for the annual subscription (save 20% off the monthly, buy it HERE) cuz they’re making it many times over in 1 trade!

I’mm up about $4.5k on USS so far (still in it with 4k shares)
-Reaper (Michael Goode, my one time hater, who’s now made over $10,000 (by my estimation) off a little $500 combo package, see his prior testimonial HERE)

Banked it at 3.68. for a nice profit of $290 in about 45mins.
-YG

Oh yeah, here’s the pretty chart pattern, let’s see if it looks familiar to you guys yet:

Here’s the story of a pump named MKTY as told by my alerts—this isn’t magic, it’s just how pump and dumps act…it’s about time people gave them the respect they deserve cuz they’re just so damn predictable!

Posted on TIMalert subscribers-only-website at 8am today:

MKTY is my #1 potential short today (already reserved 1,500 shares to short or the day), especially on any spike, I was early shorting yesterday, but played it safe and even managed to escape with a small gain…TIMalert subscribers know all about it as the subscriber-only website had over 100 comments yesterday (new record!)…also discussed in my blog post last night…this is a pure pump, but it’s only a $25 million company so it can go further than you think possible…yesterday was 2nd big up day, if this pattern holds true, the 3rd day is tough for it to finish up big, let alone up at all…of course the pattern h as mutations so maybe we’ll get a true Supernova here…at the very least, I’m hoping it can squeeze some early shorts past the the key $5 resistance

shorted MKTY at 5.40, perfect, perfect pump and dump price action

perfect short squeeze this morning on pathetic volume, tried shorting 1500, only 300 shares got executed before price cracked on even more pathetic volume…shoulda woulda coulda been more aggressive in my limit order and gotten it all filled at 5.35, 5.30, but hindsight is easy….good news is no way in hell did u need this alert to tell u when i’d short, i called this price action EXACTLY in my premarket watchlist…guess i’m gonna hold these 300 shares for a while, not worth taking anything less than 75 cents/share profit

covered MKTY at 4.73, wanted 4.53, good problem to have, 15ish% profit!

yeah i know i said 75 cents/share profit, booo hoo, i only got 67 cents/share profit…had my order at 4.53, but somehow it didnt get executed during the panic selling…if it was a bigger position, i’d probly wait around for the probable late day fading, attempt at taking out just now found support at 4.50, but i’ve got too much stuff to do to worry about trying to extract another $60 in profits…fact is this was a perfect TIMalert call so i expect testimonials galore from you people (just comment anywhere on my TimothySykes.com or TIMalert website, u know i’ll highlight em!…no need to rush, this bubble is probly popped as i seriously wouldnt be surprised to see this thing under $4 in a few days, but who knows, i like to taking my quick profits, no need to worry and i’m proud to have another giant TIMalert success

End result: I shorted only 1/5 the shares I wanted, covered $1 too high, but my good entry made me $200ish on a $1600 investment in less than 2 hours. (Suck on that value investor bitches that’d take you a year, a good year at that, LOL!) If the goddamn SEC hadn’t clamped down on my ability to trade (others are beginning to see my point with this, right?), my early exit would matter little for I’d be in and out this thing more times than Lindsay Lohan in rehab!

Infinitely more important, even though I had an itchy trigger finger on the exit, my last alert said under $ was a possibility and now that’s happened today no less! I love when TIMalert subscribers bank thousands of dollars: behold the testimonials you curiously don’t see day in day out on all these other “newsletters”…cuz they’re all Bullshittttttttttttt.

Yup, that’s a dare to every other newsletter out there, I post my numbers and now testimonials every day, you put up shit. You don’t deserve to lick the ground I walk on, not because I’m that great/good, but because you’re scum…typical finance industry scum. Put up or shut up cuz lil brtually honest Timmay is gonna shut down you talentless tricksters / marketing maggots…or at least take your subscribers away…

Testimonials:

Made $652 on MKTY after commissions. Sold my 700 shares at $4.15, a 0.96 or 18% profit. Perfect call Tim!
-AdamN

Shorted 200 shares of MKTY at 4.97, covered at 4.70. Even with a slow trigger finger I made an easy $55 on this perfect morning TimAlert watchlist setup…TimAlert subscription paid for on my second trade.
-YoungGunz

NEW YORK IBD MEETUP GROUP
Wednesday, July 23, 2007

7:00- 9:00 Gil Morales

If you’re in the area, I suggest you attend the event with me, not because you’ll meet a lot of great people and investors with superior market knowledge–screw that, most people there are gonna be just as poor, confused and distrusting as you–but because the speaker, Gil Morales, from 7-9pm is impressive. He worked with/studied under/wrote a book on short selling (see the decent book HERE) with the man William ‘CANSLIM’ O’Neill and check out his official bio:

Mr. Morales began his investment career in 1991 as a stockbroker in the Beverly Hills branch of Merrill Lynch. In 1994 he joined PaineWebber, Inc. where he quickly achieved Chairman’s Club status as a top producer. In 1997, William O’Neil personally recruited Mr. Morales to join William O’Neil + Company, Inc. where he spent the next eight years as a Vice-President, internal Portfolio Manager responsible for managing a portion of the firm’s proprietary assets, and Manager of the O’Neil Institutional Services group responsible for advising over 500 of the largest and most successful institutional investors in the world, including mutual fund, pension fund, and hedge fund clients. Mr. Morales also co-authored with William J. O’Neil a book on short-selling, “How to Make Money Selling Stocks Short,” published by John Wiley & Sons in 2004.

In the period from January 1, 1998 to December 31, 2005, Mr. Morales achieved in his personal account a total return of 10,904.25% as audited by Rothstein Kass & Company, a hedge fund auditing firm. Applying a standard hedge fund 2%/20% fee structure to this return would yield a pro forma return of 5,572.04%, net of fees. Mr. Morales received his B.A. in economics from Stanford University.

Also read THIS interview TradingMarkets.com did with him a few months back

So just drop what you’re doing and signup, only 80 spots left right now…

Given that its chart was eerily similar to similarly crappy company UBHI, which dropped nicely off its highs, I tried shorting into the morning panic around $3.30, but discovered my Thinkorswim rep had mistakenly inputted 200 shares instead of 2,000 shares into my account so I had to login to their handy chat program and fix that mistake. Unfortunately, morning panics are quick so by the time we got that straightened out, the stock had tanked all the way to the $2.90 area…bastards…but manual ‘fat finger’ mistakes do happen, you just gotta accept it…

Luckily, there’s been a decent bounce so far, so as I alerts TIMalert peeps, I shorted 1,000 shares at $3.18, the goal being to cover in the $2.75 area, either later today (wishful thinking) or into a morning drop tomorrow–or even Wednesday or Thursday–considering this is a half position (I purposely used only 1,000 out of 2,000 cuz shorting late morning into a rebound is not an ideal chart pattern for me).

So what’s the situation now? Well, I researched it thoroughly last night (as I do all the companies on my morning watchlists) so I know that while they’ve been having typically sugarcoated press releases talking about growing revenue/profits, their monthly updates in April, May and June were met with no buying power…only after this early July PR that they’re changing their corporate name in the hopes of going AMEX has their stock spiked 50%+. (Listen, name changes are done only by the worst companies who are embarrassed of their past…CEO says it simplifies things my arse! Why would anyone want to go through 5000 hours of additional paperwork, there’s a definite stench of some kind here)

Normally, I’m hesitant to short fundamentally sound companies, but this is one sleepy mofo whose business/industry–pain management/electrotherapy–ain’t goin’ anywhere fast, so methinks this spike retraces below $3–just as it did this morning–support being at $2.85ish and $2.60ish…volume has already begun to fade, so if this closes down on the day, it’s the first down day pattern we all know and love…for reference, see the chart below of how similar spiker Hydrogenics Corporation (USA) (HYGS) performed after it had the same kind of morning panic and slight rebound throughout the day (usually a momentum killer, signs that a gradual fade will play out over the next few days):

UPDATE: Just tried to break above $3.20, ran into wall, very good sign it will close red today making me a happy TIMMAYYY!