I have a home based trading room. I usually have an individual, would be day trader, trainee with me. Although I don't advertise this fact many of my neighbors and acquaintances know this. A neighbor from the other end of the block came knocking 2 days ago, just after the market closed. What happened to chaparral management, he demanded, in a quaky voice. "I have no idea, who are they?" I responded.
"I was trading them today and all of a sudden they were halted." He replied. Turns out he was talking about CHAR. The neighbor is a fireman. He has several days off in a row every week and he became enamored with the market. He opened a trading account with Datek, using $2,000.00 of his retirement funds. He has been trading about 12 days. He had come by a time or two prior to beginning. He read one book from my library and bought a couple others. He came and watched me trade one morning for about 3 hours. He has the Datek Streamer, the Island book, and 20 min delayed charts from Big Charts. With this foundation he began his career.
After trading 11 days he was up about 400.00. On the fateful 12th day CHAR caught his attention as it zoomed from 8.00 to 36.00 per share. When it pulled back to 30.00 he readied a buy for 50 shares. He bought in the 28 zone. Steadily watching it decline the next few hours he held his breath. When it whipped to 21 and back to 25 he nearly puked. Then the bid/ask went to 0x0 on the streamer. For 15 minutes or so he thought the streamer was having trouble. Finally he called Datek. "let me look", the helpful technician said. "nope no problem, the stock has halted." His account was showing 300-400 in total value.
In shock he wandered down the street and rang my bell. I had no answers for him that afternoon, only sympathy. Later that evening around 10:00pm , I did a little scan for info. I found an audio clip and very little in print. Calling him up I invited him down for a strategy session. We listened to the clip and spent an hour or so discussing possible outcomes.
He showed up promptly the next morning ½ hour before the market opened. CHAR did not trade all that day. He stayed and watched us trade. It was now clear to him he had been trading on a wing and a prayer.
He left his account info with me that night, the next day he was due back at the fire station.
Morning dawns on the third day. Logged in and ready for business CHAR begins pre-market at 12 and change. Watching Qcharts with L2, I wait as the bid/ask begin to rise. About 6 minutes after the opening bell the stock is hovering between 23-24 per share. I see a stall developing and hit the sell for 50 shares @ 23.00 It takes nearly 2 minutes, which seem like an eternity, for the shares to be traded and cleared. Mean-time, the stock is rapidly working back and forth and beginning to fall. I am just about to hit the cancel and shoot another 1.00 under the bid when the all clear comes through.
Calling him at the fire station, I give him the news. We rocked. He is out at 23.00 and has about 1544.00 back in his account. In a voice near cracking, he thanked me. I have not seen him yet, as he has to spend a couple days at the fire station. It will be interesting to see how he picks up the pieces and resumes his trading.
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