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Trading Lessons

When To Take A Break & When To Push It!

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Written by Timothy Sykes
Updated 7/24/2024 5 min read
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Our market environment can change day to day.

One day the market could fall lower, bringing 3 out of 4 stocks with it, the next day it could surge upward with a bullish catalyst.

That’s why it’s so important to pay attention right now!

At the very least, follow me on social media to keep track of the market conditions. I’m always posting about the hottest plays in the market.

Here’s my social media account.

Yesterday we experienced a HUGE price swing in the overall market.

Major indices dipped as tech stocks posted poor earnings, specifically Alphabet Inc. (NASDAQ: GOOG) and Tesla Inc. (NASDAQ: TSLA).

Take a look at the S&P 500 ETF Trust (NYSE: SPY) market-index chart below. Every candle represents one trading day:

SPY chart multi-month, 1-day candles Source: StocksToTrade

Now take a look at my post on X below:

We’ve had a HUGE summer thus far, full of insane runners. That’s why I’m not surprised by this market pullback.

I’m not nervous about it either …

In fact, now that the market dipped, it opens the door for a possible market rally. And any surge could bring back the +100%* intraday runners that we’re used to in 2024.

Get ready for the rally!

The Next Trade Opportunity

jack kellogg and sykes in italy
© Millionaire Media, LLC

It could be as early as today …

Remember I mentioned that this market environment can change overnight.

Every day this week I’m looking for a return to the insane small-cap runners we’ve been trading all year.

The same kind of runners that my students, Evan and Chris, used to pass the $1 million milestone earlier this week. See my post below:

For example, on Tuesday, July 23: Azitra Inc. (AMEX: AZTR) spiked 640%*.

The biotech stock announced new patents that strengthened its overall intellectual-property portfolio.

Plus, StocksToTrade shows that there are only 640k shares in the float. Any stock with fewer than 10 million shares in the float is considered to have a low supply. And the low supply helps prices spike higher when demand increases.

This was a textbook spiker!

How To Catch These Runners

Anyone watching the StocksToTrade Breaking News scan would’ve got an alert right when the stock started to spike.

Take a look at the alert overlaid on the AZTR chart below, every candle represents one minute:

AZTR chart intraday, 1-minute candles Source: StocksToTrade

Get the next Breaking News trade alert!

You don’t have to take my word for it … I have students that swear by this trading tool. Take a look at the post on X below:

 

Source

Nicole, another one of my students, recommends everyone to use the Breaking News scanner in the market. See here quote below:

“Review your trades afterwards to learn. Use Breaking News (it’s) such a great tool! Participate in the … (Challenge) chat. We help each other.”

Nicole is right! We help each other in this trading community.

New students have access to millionaire traders through the Challenge chat. If you have any questions, that’s the place to get specific/tailored advice.

Start asking questions … Because the next trade opportunity is right around the corner.

Cheers.

 

*Past performance does not indicate future results

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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 (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”