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Trading Recap

How I Predicted This +15% Weekend Winner

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Written by Timothy Sykes
Updated 12/6/2023 7 min read

How many trading patterns have you used for over 20 years…

…ones that keep turning out great trades.

I wrote my first draft of the 7-Step Penny Stock Framework almost two decades ago…

…and I just used it to pull off a textbook Weekend Trade.

A nice trade that risked $19,400. Check out all the details of the trade here.

Anyone can find stocks Safety Shot (NASDAQ: SHOT) and execute profitable trades…

…but only if you understand how to apply my 7-Step Penny Stock Framework.

That’s why I’m going to walk you through how I constructed the trade from start to finish.

The News Catalyst

Every good trade setup starts with a news catalyst.

The best ones can last days, even weeks.

The company’s drink goes on sale on December 7th on Amazon.

Leading up to that event, Safety Shot announced it sold out within a matter of hours.

The stock had already been on a tear since its earnings announcement on November 16.

This was the fuel needed for the trade.

Now, I just needed to apply the 7-Step Penny Stock Framework.

Analyzing the Chart

My 7-Step Penny Stock Framework highlights seven stages of a penny stocks lifecycle:

  1. The pre-pump or promotion
  2. The ramp
  3. Going Supernova
  4. Taking a cliff dive
  5. Dip buying
  6. The dead pump bounce
  7. The long kiss goodnight

This Optec International (OTC: OPTI) chart from 2020-2021 illustrates the stages of this stock’s epic run.

Each stage is unique but can be repeated.

As the chart above shows, you can go from stage one through stage five but then repeat stages three through five again.

Now, let’s apply this framework to a chart of SHOT.

You can think about the framework in two halves – the front side and the backside.

The frontside goes from stages 1-3.

That’s when you get multiple days of buying with increasing volume.

This is when I like to trade breakout squeezes and dip buys.

On the backside, the stock is crashing.

That’s when I’m looking for truly oversold conditions to play for a bounce, and is a great place to look for Morning Panic Dip Buys.

The key is to identify which stage you’re in and apply the correct setup for that stage. For example, you don’t want to look for breakout setups when a stock is plummeting.

Identifying the Stage

When I looked at SHOT on Friday, I needed to go down to a lower timeframe to see what was really going on.

The initial drop off on November 21st was the Supernova bubble popping.

On the 22nd, we got that bounce off the bottom.

Normally, stocks fade into oblivion at this point.

However, shares rallied to $5.00 over the next few sessions before backing off.

Then, they put in a slow but unmistakable uptrend, grinding higher for the following two days.

The final punch came on Friday when the stock ran early on, fell hard, but still managed to close near the highs, which was right at the $5.00 resistance.

This type of price action signals strength.

And when you combine that with the upcoming product launch and short squeeze potential, this told me we were in the 3rd stage again.

Closing the Trade

During Monday’s premarket, shares peaked early at $5.25 and then right near the open at close to $5.50.

My goal for most trades is a quick 5%-10% win.

With the Weekend Trades, I’ll often aim to close these out near the market open.

However, I wanted to see how this one reacted for a few reasons:

  1. It had a lot of momentum behind the name
  2. The product debut wasn’t until the 7th
  3. Beaten-down stocks often bounce hard in November/December

While I closed out the position as I usually do, shares continued to rally all the way to $6.43.

Had I held on that long, I’d have logged a 32% gain.

And if everything I’ve written for you here isn’t enough, I’ve opened up an entire video lesson I shared in my recent Twitter post:

🌟 Ready to Master the Art of Weekend Trades? 🌟

Trading isn’t just a weekday game anymore.

My recent success with Safety Shot (NASDAQ: SHOT) proves that the right strategy can turn weekends into winning opportunities.

Are you still stuck with traditional patterns, missing out on lucrative weekend trades?

🚀 Discover the Power of My 7-Step Penny Stock Framework.

🚀 Learn to decode the market’s subtleties and identify the perfect trading stages.

🚀 Experience live, step-by-step analysis of real trades, including the sensational SHOT play.

🔍 Tired of watching the market outmaneuver your strategies? It’s time for a change.

🔍 Watch firsthand as I break down the nuances of weekend trading, revealing tactics that most overlook.

🔍 Embrace a method that has withstood the test of time, adapting to market shifts and delivering consistent wins.

📈 Your Journey to Weekend Trading Mastery Begins Here.

📈 Step into a world where timing is everything, and understanding the market rhythm is key.

📈 Don’t let another weekend pass by as a missed opportunity.

👉 CLICK HERE TO JOIN THE LIVE TRAINING AND TRANSFORM YOUR TRADING APPROACH! 👈

 


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Author card Timothy Sykes picture

Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (205) 851-0506 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is 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. Millionaire Media LLC and Timothy Sykes 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. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes 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, nor 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.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”