The safe way to trade bankruptcy stocks

Plus, my two rules for trading them...                                                                                                                                                                      Good Morning! Over the last 3 days, Bed Bath & Beyond Inc. (NASDAQ: [BBBY]( and Party City Holdco Inc. (NYSE: [PRTY]( were up as much as 121% and 177% respectively. But I don’t like them… It might sound counterintuitive to not like two of the biggest trash stock runners. But hear me out… Holding onto these stocks is like removing the pin from a grenade and holding it in your hand … Yes, you can make money in the short term. But is the [risk worth the reward]( These bankruptcy plays always end badly. I said it on [Pre-Market Prep]( yesterday… They’re like the ticker RDBX from last summer. We knew how it was going to end… And now the stock isn’t even listed anymore. So here are the rules if you can’t ignore these degenerate bankruptcy plays… How To Trade Sketchy Bankruptcy Plays BBBY and PRTY are some of the most liquid [big gainers]( of the week, so I don’t expect you to ignore them completely. There are ways to profit from the moves. But there’s one big caution I have for traders about these tickers… Why I Don’t Like Them The biggest thing I see people get tripped up with on these bankruptcy plays is they fall for the hype. People see posts on Twitter that say PRTY is going to $1 and BBBY is going to $5... And they believe it. I’m not saying BBBY can’t go to $5. But the problem comes when traders take a position and the stock goes up — they see profits and think it’s great. So they hold it. They think they’re going to catch some gap-up moves and shorts will get squeezed, but the next day news could hit and it gaps down 30% and it never bounces again… Then they keep holding for a bounce that never comes, they hold until it’s delisted and literally lose everything. The end game with all bankruptcy stocks is the same — they're going to zero. And I don’t like to see new traders lose everything. How to Trade Bankruptcy Stocks Instead The first rule for trading bankruptcy stocks is I don’t like them on the first day no matter what. But once they continue and prove themself — that changes everything. Tuesday was the second day of PRTY’s perk, and the best trade was in the [afternoon](. But it got destroyed yesterday... PRTY chart: 2-day, 2-minute candle — courtesy of [StocksToTrade.com]( On day one BBBY went sideways. Then on Tuesday, it had a quick spike after a [dip and rip](. And had another nice one yesterday… BBBY chart: 2-day, 2-minute candle — courtesy of [StocksToTrade.com]( This is why I only like these stocks after they prove themselves. It can just help you [stack the odds in your favor](. The second rule for trading these stocks is to stick to [day trades only](. Traders who stay agile can trade them with no problem ... You can get in and out quickly, trade the patterns, and it can work out great. Just don’t get caught up in the hype and think you’ll catch a gap up from holding overnight. The risk is so much higher than the reward. Either don't trade them. Or know that you're trading something that will eventually get destroyed, most likely get delisted, or go to the [OTC markets](. Day trade them, take quick gains, and don't aim for home runs. Have a great day everyone! See you back here tomorrow. Tim Bohen Lead Trainer, StocksToTrade P.S. I told you to watch your inbox for exciting news yesterday — did you see it? If you missed it, [check it out here](   sponsored   sponsored   [Are you a quitter?]( It’s ok if you are… Because quitting might be the best decision of your life. Sound crazy? [Click here to see why it’s not.]( Recommended Membership Gifts   ACCESS NOW: Click to activate these complimentary membership gifts and receive daily market intel. [To The Moon Report Weekly Stock & Crypto Watchlist]( [Mark Croock Evolved Trader Daily](   [Facebook]( [Twitter]( [Instagram]( [YouTube]( [Spotify]( [Click Here to Unsubscribe]( (As an Amazon Associate, we earn from qualifying purchases.) 13809 Research Boulevard, Suite 500, Austin, TX 78750 *Please note that these kinds of trading results are not typical. Most traders lose money. It takes years of dedication, hard work, and discipline to learn how to trade, and individual results will vary. Trading is inherently risky. Before making any trades, remember to do your due diligence and never risk more than you can afford to lose. This is for informational purposes only as StocksToTrade is not registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. StocksToTrade cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. StocksToTrade in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, StocksToTrade accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns. Copyright © StocksToTrade.com