A short trading-advice video by Kardec Trader about avoiding being 'swept out' (stopped out) on spike days. The speaker recommends using fixed-percentage stops instead of pre-market-high stops, describing examples (e.g., large percentage tolerances like 200%) and explains how small-cap stocks often have long-term downtrends and spike-day dynamics driven by long-term holders selling into spikes.
Using a pre market high is not the best stock because it's not a fixed percentage point. Right. It could be different based on the setup. So what I use now is a fixed percentage stop. Let's say, you know, why stop 75 to 150% from the entry. Let's say my stop is way up here, 200%. I would be surviving this pre market high clear out and let's say that eventually it fades back down. Sure I was down, you know, 20% at one point, cleared the highs, but I still gained 30% by end of day because the ideal covers are going to be the longest time frame. You look at the daily chart, the overall trend of these small caps is like this. And this is the market open of the spike day. So let's say this is like a period of months or years, always on a steady downtrend because they're bad companies when they're selling off. So a lot of the times the reasons that these sell off from a spike is because you have long term bag holders in the stock looking to get them.
