Live Trade with Peter Leeds
I'm, going to tell you about one of the trades that I'm making personally, this is an active, trade right now and I'm. Either going to be out of this trade within about a day or two or I'm gonna be in it for a little bit longer it's, a short sale I'll tell you all about it right now. Hey. I gotta be honest keep those suggestions coming if you want to review a stock on camera for you put, it in the comments, below this video and we'll add it to our growing. List and we're gonna put all the names into a hat our sock and I gotta be honest with the reason we haven't started doing, it yet even though you guys have been suggesting stocks. Is my, fault nobody else's fault I was grumpy I don't know if you could tell I was grumpy that day when we were filming the video and, I just wasn't in the mood but we. Will get to it I've told that before this is my second time saying don't worry we'll get to it and I feel bad about that we, will though we're gonna start getting into it next week and in. The meantime today. I'm gonna talk about travel. Zoo which, is a stock, that I believe, is going to top, it and price around these levels and start coming back down so I sold short on it which. If you don't know what that means it means that I'm selling, the shares first and then, later I have to buy them back so I'm hoping that the stock falls on that time there's my profit, you, get it okay, so here's one top you should really watch that twelve dollar level, right now and, intraday. Like the markets are open right now and travel. Zoo is trading. Above twelve dollars and under twelve and over 12 but, that's the point I'm watching if it closes, not, intraday, but close over. Twelve dollars that's, an issue and like I rethink the whole the. Whole trade, and I might have to get out of it pretty quickly but, it won't matter if, I'm right or I'm wrong about the direction of the travel Zoo stock and this is the most important, thing you're gonna know about investing ever in this, moment okay you've. Been if you're wrong two-thirds, of the time but you're right one-third, of the time you, can be a very profitable trader. The, trick is that when, your stock starts going the wrong way that you jump ship really, quickly and take a very small loss, and then leave yourself open to the bigger games that come want to stop those cooperate. So, for example, if travel Zoo closes up, of $12, and keep in mind this isn't trading advice this is just what I'm doing personally, I never give, advice you, make your own decisions, but. If travel, Zoo closes over, 12 hours out the clothes at 4 o'clock today then. That. Stock has not done what expected it to do and so therefore my premise, is incorrect and, so I'm going to move out of that stock as soon as possible, I'll probably, be selling shares before, the mark even warms up tomorrow morning there's a very big difference between an. Inter great price and a closing price if, a stock has an intraday price it's very low and then before the end of trading it starts at climbing, a bit or search to recover a little bit even if it's only a little bit that. Tells you something, very different, about the, upcoming moves, from the stock based on the psychology of investors, if this. Stock trades, all day long and it closes at the end of the day four o'clock New York time at the, lows of the day it was lower at that point at any other point during the day and, that implies that the next day with markets open that selling, will, possibly. Continue. And so when, a stock closes, a slows for the day the. Next day is usually a negative day, and it's a very negative indicator, so keep that in mind there's a big difference between intraday. Prices, and closing prices they're, telling you something totally, different and you have to be aware. Of each different. Aspect, of a stocks trading, price but, the other reason that I was focusing. On a 12 dollar level, with Travels is that, that was a previous, resistance level, that's also a level where you see the resistance increasing. As the stock price approaches, that level so, the stock is at $10. A source moving to $12, you can tell if the resistance, is at that level based on a few factors, so for example, if the trading volumes increase. As a stock. Approaches, a certain level that could be a resistance, level or. A support. Level if it's going the other way - all, of this works, both ways support, and resistance, a resistance. Level is, going to see an increase in volume it's also going to see a tightening, up of the spread, the, difference between what people are willing to pay for the shares and how much they're looking.
To Sell them for if they are current shareholders, that, number is always gonna have a spread between the two and when, the prices meet up that's when a trade takes place so. You're, going to see as a stock, approaches, assistance, in some cases there's going to be a tightening, of that spread, in addition. To the increasing, volume a lot of times it'll be a threshold. Point like $2, to, $54. $7 like those round numbers because a lot of retail. Investors, are going to be or less experienced, investors you're going to be making, their trades based on those round number of prices a lot of times to see well if it hits $4, then I'm gonna sell or if it hits $4, and I'll buy more, and. You see this playing out even with Bitcoin. And crypto currencies a lot of people say they look at Bitcoin go okay, well if it drops down to $4,000. I'll buy it or, they say I'll draw I'll start buying when it drops to 3,000, it's all relative. Pricing. About, where it was before and then where it is now it's got nothing to do the actual value, of the underlying asset, and as a stock approaches, what could be a resistance, level you're gonna see a shift in the, momentum you're. Gonna see things like there's, a lot of actually indicators. Which will tell you the moment I'm one of which is just shows, you what the momentum, is you're, gonna see a decline in the momentum as it gets closer to that support level and you can look at things like MACD, which is moving average Convergence divergence, and. That also is another, momentum, indicator, is a whole bunch of them and you can see ok, the momentum, slowing the volume is picking up it's hidden a threshold level previous. Support, level that's how you know it's probably, a, support, level again, or resistance. Level sorry I misspoke there when you know what I mean and I got off topic there for a minute we're talking about the stock, names and you put into the Hat I was, thinking why put an add anybody can put it not a kid could do that let's do something cool like what would be really cool like we're gonna chicken the pick around at seeds and if it hits your, stock. Suggesting. The mess one will do I want something cool. Or unusual. About, how we're gonna pick these stocks rather than reaching into a bucket and pulling it anybody, can do that if they have hands, in a bucket and with Travels ooh these resistance.
Songs These. Resistance, levels, seem, to be reestablishing. Again and again at. Proportionally. Increasingly, lower levels, and I can show you this on the chart but this is not unlike what's been going on with the Dow Jones Industrial, Average if you saw my video the other day about how the Dow Jones Industrial, Average keeps, top, or touching, up against different resistance, levels that proportionally. Lower. Figures. Or lower levels, this, is exactly what I think is happening with the Dow Jones and it's similar to what's happening with travels ooh right now and, some of the things they look at to really, make sure that I'm more. Secure, in this trade and understand to this, is a more like a swing trader or short term trade I'm not looking for long term anything, and I'm not really looking for a big profit I'm, looking to see if I can either walk away the 2%, loss or I could, hang on for a 10 15 percent gain and a, relatively, short amount of time which means weeks, not months one of the things I look for is if it decouples from the major overall, markets, so for example if the markets go up 10% and. Travels. Ooh only goes up, 5%. Then, that's a negative indicator, or for example if the markets decline 5%. Rumbles ooh drops, 10%. And that's very negative, but if they be couple, and trouble. Suits going up when the markets are going down the markets are going down and truffles is going up I just said the exact same thing twice right in a row because, I got, confused, if troubles, are is declining in price and the. Markets, are doing something completely different, either declining. By even more or or they. Are increasing. Up, against, travel zoos decline that means that this talk has decoupled, its gonna trade on its own rather than just go with the flow or the whole tide you've, heard the expression a rising, tide lifts all boats that's, it's talking about some. Stocks most stocks will trade the same as every other stock on the market and there's, a few outliers that go the wrong way you, watch to see if the stock you're looking at is decoupling. Because, then even if you see the overall stock market's increasing, you, can see maybe there would be an opportunity, for other stocks to decline such, as travel zoo because it's the couple that's not going to trade the width the overall markets do you also look at the comparative, valuations. And this, is more appropriate, for, longer-term. Investing, so I wouldn't even need to worry about this kind of stuff too much right now because. I'm just doing a quick short trade with travel, zoo but, if I was going to go into something for a much longer time frame and I really wanted to look into the stock you, look at how they're doing comparatively. To their direct competitors, so if they're making a 10% profit and a direct competitor is making. 30%. Over that same time then, they are operating. Less efficiently, and you can also look at all the financial ratios but you don't need to do that for a short-term trade, you do that for a longer-term trade, that's when you really get into the fundamentals, I don't, care who, the CEO of travel, zoo is I don't care how much money they made last year none of that matters because this stock trade will, be quicker I'll be in and out before that. Kind of stuff would actually come into play and matter stocks, operate. At a speed, or the pace of stocks, of companies they'll. Take months and months quarters, and quarters to, do. Things implement, things and thus even benefits, of them which then eventually. Will, be reflected, in the share price but. Until that point especially. With a quick trade like this none, of that matters, so it makes it a lot more efficient, we, have to look into but it also puts you at exposure. To being.
More Likely for. Your call to being correct and you can see here that it travel, suits had a lower top-line, number, for, years, and years and years every. Year they, made less money than, the year before, and therefore. Every, year they had lower, gross, income and. I'll trickle down on an annual, basis, for their earnings, to go from 13, million to 11 to 6 to, 1.6. Million in the last fiscal year and. If you look at a quarterly, basis, you're looking at in, declining, every, quarter three quarters ago is two and a half million dollars in earnings and, their, revenues came in and the, quarter after that at only four hundred seventy seven thousand, dollars in the, next quarter they only made 118. Thousand dollars in that three month period the fact, of the matter what's, important, here is not the number it's relevant. Like what does that mean they made 118. Million they made under 20 million it's no different what you can't even understand what's the difference between all that what's, important, is the speed of the decline and also, how it is in comparison with, their competitors, compare. The speed of the decline if their revenues, are dropping by 40 percent and then. You go, okay that's horrible, but then you would look at well what's going on with the industry is this trading in sympathy is everybody try forty percent sometimes they will be the entire industry, or that sector, could decline, the same pace and it could be significant, or it can increase by, a lot but if it's everybody, increasing, together that's, not the same as one specific, company which, really, jumped up in price it's, the difference are you trading the, market, is it a stock on the market that you're trading and it's gonna go with the whims of the overall market or, retraining, a specific. Company, which. You believe is going to do really well and expand, and increase their share price there's a difference, and it's very subtle but this is one of the things that as you become a better investor you'll, sort of understand, intuitively.
Annual. Benefit. By trading, and thinking this way but, a company, like travel, to specifically. You, do want to look at it from a seasonality, kind, of perspective, just like a ski hill they're going to make more money at certain times of the year so if, you're looking at a travel, zoo for example or ski Oh I'll use that example because it's pretty clear if. You see a drop, in revenues, is that a bad thing because maybe, it's, the summer now and there's no snow and so, you. Got to see how do they do comparative, fully in that same quarter, to the same quarter in the year before it was quarter two you, look at quarter to do they do better in that quarter, last. Year or this. Year and then, that's going to give you a better idea of how they're doing by taking the seasonality, out of it looking. Specifically. At comparative. Quarters if. This is going to be anything other than a. Short-term. Trade, I would, get really. Into the seasonality, aspect, of it I would look at the other competitors, and them. And compare, how they're doing compared. To each other and compared. To themselves, in the equivalent, quarters a year ago how'd they do in quarter two I've been doing quarter three exactly, like that I would get into it really deeply, luckily. In this situation. Travel Zoo and this trade that I am making personally, this is not trading advice it is, got nothing to do with fundamentals. So we can put. That all aside I'm. A fundamentalist. Kind of investor, so I love this stuff and I get into it but for this trade fundamentals. Are kind of not as relevant so. This, is a good idea for a trade if you have. Not, a lot of time to actually get into all the stuff and you just want to see if you're gonna be right or not you actually don't even need, to look at very much at all for making. A stock market trade you just need to know what you want to do and a, lot of times you can buy a stock and if it goes the wrong way and if you're quick. At getting out of it right away there's, a lot of things.
You Can overlook, because you know that your downside is very limited, and so without even looking, maybe it starts going up in price and you benefit from that but you don't even know why it's going up a shorter-term, trade, you, can get away with, being a little bit lazier, and I wouldn't have bothered and. I did not bother with this for a short term trade but, I'm telling you guys that for, generally. Since I'm a fundamentalist. Investor, mostly, mainly and also. Then technical, analysis, and as I telling. You guys I got a Japanese candlestick, chart course coming up very soon that I've been working on I'm really enjoying it you guys are gonna like it a lot I'm 80%. Fundamental. Still but, I'm trying to get more into the doctor, calls just because I don't have the time anymore further. Than now to work and this is also the curse of this business and I, say curse but I love, what I do my team loves what we do I believe, they love what they say so but, I you know I pay that I sign their paychecks so they always tell me that they like what I'm doing if. I were to get into the. Fundamentals. Of this company, first. Thing I would do I always soon as I go straight to the balance sheet and I see did they have enough money more, that. They own than. They owe if, they have enough money to be solvent, to have their, debts covered, first, place they look especially, because a lot of stuff we look at our penny stocks stocks $5 under now these are smaller more fragile, companies. So, we look into that stuff first because there's so many companies that you're the balance sheet and you say well, these guys are two, million dollars in debt. Or underwater even after all their assets are taken into account that's. The cash crunch that's not the type of investment, you want to be looking for especially when you have the ability, to choose between. Thousands. Of thousands, of them why would you go to a company that has less. In, terms of assets than, they owe it's, ridiculous, just go, okay that might have been a good trade probably, not I don't know move, on next. We want next move on next and you just go through a lot and the more you go through the quicker you go through with, the less amount, of work, the. More great opportunities. You're gonna see as you do your own research, but. To go back to my point about the curse the curse of this business is that. The. Vast, vast vast majority. Of work we do is behind the scenes so if, I'm talking to you about a specific stock, for. Six. Minutes at some point in a video you, know that there's at least six hours going into it before that where we're, looking at all the financials, and we're not talking six hours straight we're talking over a day so we watch these stops and we keep, track of everything so that then when we are ready we say okay this is what we are watching for it, is setting up like we think it may be coming, down on price and it won't go much higher than, this and, you build, a theory and the longer you take to go up theory the more likely, you will be to be absolutely, correct in this, game you just need to be correct and find. Us a, system. That works for you you do more of what works less of what doesn't and then, you just keep on doing it you replicate it it's, a rubber stamp once you figure out what works for you then, you just keep on doing it again and again and there's a ton of money in that and you will be more, successful as, an investor, if you. Find. Your angle so to speak and this is one thing that I would always suggest to you as an investor as long as you're, keeping track of watching, your downside and you use the stop-loss orders, and you're, thinking, about using limit orders rather than market orders then, you can become a much better investor, pretty rapidly actually and it can be quite fun to be honest with you it would be a lot of fun even the, losses, will have something that you can learn from and, they're, not as fun but the.
Gains Are, enough. Awesomeness. That it overrides all of us something I'd do to get through, to get to this point. Anyways. On their balance sheet they have 30 million bucks. Current. Assets current means, that these are going. To come up for. Use. Or, be. Relevant. Within the next 12 months and. They. Have, 41. Million dollars in total assets. Now. Current, liabilities, of twenty four million dollars means that they have to pay these, liabilities within. The next twelve months this includes things like rental, payments invoices. Salaries. For employees buying new equipment all. Of that those liabilities. These. Are things that have already been bought or are, going to be bought with the next twelve months that, I've not yet been paid for so. Then they've got twenty six million dollars total liabilities. So, if you think about it, take. Off their current, liabilities. From their current, assets so to put something about a net, value currently. Of about six million dollars, and, if you look at a bigger picture so. If you take into account things like factories. And, intellectual. Property you've. Got twenty six million dollars in liabilities, against. 41 million dollars in assets so that's, not a lot of room. To breathe there so to speak but it's definitely healthy, enough for the, stock to either trade. Dramatically. Higher or dramatically. Lower it's. Not, completely. Out of the bounds of what would be a number. You'd want to see it's okay it's okay it's not great but it's okay but my point with all that though if they've, got theoretically. About. Fifteen, million dollars, of value. If you took all their assets, and sold them off and paid off all their liabilities, they have 14, million bucks but. What is their market cap Travels ooh the market cap of the company, the valuation. You, take all the shares that are at their times the, number, of or the price of the shares at this point you're, looking at that market cap of about 141. Million dollars, but, if you think about it in their last year in the fiscal year they, made one point six million dollars in net earnings which, sounds great and it's. Kind of irrelevant because one. Point eight 1.6, 1.2, what. Does that mean to you as a person nothing it's only valuable, when, you compare it to the competitors, or you compare it to the company itself and then it adds a lot of value to a number, you're going from just a cold. Gray, dead, number, and you're putting it into perspective. So, if they have one point six million dollars in net earnings and, their market caps 141. Million dollars that's, a comparative, ratio, of about 88, to one their. Earnings, are 188, of what. Their mark campus, and these things, don't technically. Usually. Go, together or be compared against each other but this is one of the ways that I look at stocks and I, think, that the valuation, is we do high when you've got a stock which, is only making 188. Of. Their. Market cap on an annual basis, and their, current price earnings ratio again this is another valuation.
That Trick to see if the shares are overvalued right, now is, about. 235. That's, what their prices compared. Or divided by what, kind of earnings they bring in so you're, looking at another, way to say it is that you're investing. 235. Dollars for. Each $1. Of earnings, that you're going to be getting from the company at the current rate based, on how they've been doing the last three months so if you think about that if you want to lend me two hundred thirty-five dollars I will pay you back one, dollar a year for the rest of your life let's. Do that you guys want to do that we'll do it it's kind of like the guy that poker dink was a couple, of threes and then as the game plays out it's a go I could have won I would have won a Fed staying in does, that mean with, a pair of threes you should stay in because you might win, if you want to play cards like that you're gonna wind up broke every, time but it's. The same thing are you going to lend. Me two hundred thirty-five bucks so that I give you a dollar every. Year for, the rest of your life is that a good deal that's, why you're talking about this valuation of this company random this does on me and understand none, of what I'm saying here means that the stock will not increase. It, might explode, I'm price higher I think, it's going to go down on price and if it does explode doubles, in price triples. In price I'm at a loss of like two percent that's how you invest Wow and if. You have, the stock going the way you think it's going to go then you just have to work, on deciding, when you're going to exit, and take your profits, and it's a simple game that way and, people who are asking when, I can start putting my own personal, holdings out to these subscribers, of Peter Leeds comm newsletter, and I. Haven't, forgotten, I've been, purposely, being, told to put it off for now I'm going, through a divorce and, so there's a lot of moving parts and a lot of different things I actually don't even know what, I hold. And what I own and what I don't so, that's. I'm not saying, anything about anything in terms of what stocks i own right now but, we will get back into it I just told my lawyer let's go to court so this will be done with the next six, or seven years and then we'll go back to the way things were and I'll leave you now with one, question just for, fun, for curiosity. Where, in the world and I'll give you some clues it's in America, it's. A city that. We, get more subscribers to, Peter leaves comm newsletter, per, capita, than anywhere else in, the states so. You. Tell me where do you think that is and I will tell you in an upcoming video but, throw, your guesses. Down. Below. And, I'll give you some clues and search through the G it's, a small city I think there's a university. In the town and, it's. A nice, climate. That's. All I'm gonna tell you for now I don't know if this is stupid if you're hating this and you're like whatever and, maybe some city that you know, whatever. But. I'm asking you where do you think what, city do you think it is and, I'll give you a super hint, really, quickly here there, was a dude from the city who's, actually a, co-host, not, a co-host, a cold person. Who got interviewed, on Russia. Today in Moscow, they were interviewing, us about the Facebook. IPO and, the other gentleman was from this town so, if you've seen that video or if you know this answer already, or if I told you before way, to go let's throw these guesses, in the, comments. Below please, subscribe to the channel I just I'm gonna say that e-mart they always tell me you gotta say that because then people will subscribe like whatever, don't subscribe I give up, anyways.
You. Guys are totally. Awesome I'm breaking my back here to make sure that you guys are getting what you do yet and I'm, gonna keep on doing that thank, you so much for your great support and, we, will be in touch shortly.