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Trading Lessons

Is This The Best Way To Find Plays?

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Written by Timothy Sykes
Updated 4/27/2023 5 min read

Some of the best trading decisions made right now are from traders not bothering to turn on their trading platforms.

I’ve said it once…I’ll say it a million more times…

There’s a time to earn and a time to learn.

It’s not the time to be overtrading…but over studying.

We’re just in one of those slow-action markets.

Sure, there are one or two plays popping off each day…but it’s nothing compared to what we were seeing 2-3 years ago.

You should be spending the majority of your time studying and developing your trading skills. 

In terms of screen time and actual trading…there’s one thing that’s working really well to find plays.

In fact, it’s something I’m looking at daily to find ideas. And if you’re not using this, then you’re potentially missing out on the biggest opportunities.

A Quick Way To Find Trade Ideas

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You want to use this slow market as a time to study and develop your trading skills. 

You can probably get away with trading for less than two hours a day in this market. Especially if you limit your trading to the first hour of the day and the last.

And since there’s not a lot going on…

You really just need to scroll through a list of the largest gainers each day.

I know…it doesn’t sound groundbreaking…but that’s the market we’re in.

But with so many traders focused on these plays…it can get crowded…and a lot more difficult to trade.

That’s why I’m typically focused on panic dip buys.

In other words, I’m putting these high-flying stocks on my watchlist, waiting for them to sell off hard…and then try to buy them for a quick flip.

It’s one of the ways I like to trade Supernovas.

The other thing I’m doing is trying to find out why these stocks are spiking so hard…

  • What’s the catalyst?
  • Is this a short squeeze?
  • Is this a pump?
  • Are there sympathy plays I can trade?

Answering all these questions helps me with formulating a trading plan and coming up with new ideas.

Of course, this is a reactive way to trade…

Let’s talk about a proactive way.

What If You Can’t Trade The First Or Last Hour?

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The first and last hour tend to be the most active times to trade.

But what if you can’t trade during those time periods?

I’m not going to lie, it’s a disadvantage. However, there is still a chance you can find opportunities.

If I was stuck at my screen trading at a random time I would be focused on the StocksToTrade Breaking News Chat.

It’s the best real-time trading news I’ve ever used.

Not only does it spit out news as it’s breaking the major newswires, but it also finds all the breaking news on social media, and rumors from discord and chat rooms.

And some of their call outs recently have been on fire.

If you’re not using StocksToTrade Breaking News Chat then I’m not sure what’s wrong with you…seriously…you can’t beat it.

You can test it out right here. 

Final Note

Tim Sykes tosses his book An American Hedge Fund in the Alps
© Millionaire Media, LLC

I truly believe my next set of millionaire students will come from those studying hard right now in this crappy market.

If you can learn how to trade with patience, discipline, and with a proven strategy in this market…you’ll be amazed at what’s possible when things heat up again.

If you’d like to take the next step and learn about my program here’s the link.

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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

* 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 (888) 878-3621 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”