Far too many folks succumb to scams and market manipulations that seduce them into stocks at the peaks and get them to sell at the bottoms.
Now, I know the squeezes we’re seeing make this extraordinarily tough. All you want to do is buy every breakout, getting mad when the latest one passes you by…am I right?
What I offer my students is the framework and strategies to become great traders in their own right.
Today’s newsletter won’t make you a millionaire trader overnight.
But the lessons I’m about to offer can get you one step closer.
Now, I’m not naive enough to think that my methods are the only ones that work.
That’s why the latest addition to our trading family is a HUGE get.
Pretty soon, you’ll have a chance to learn about BEN STURGILL, an incredible trading coach and one of the nicest guys you’ll ever meet.
Ben brings deep trading insights and experience, and he does it in a way that’s easy to understand.
But if there’s one thing Ben and I have in common, it’s this…
Every successful trader balances risk and reward in EVERY situation with any strategy.
It’s the glue that holds your account together when big losses strike.
And with the squeezes in today’s market, it’s more important than ever to have solid risk management.
That all starts with this one key element…
What’s the Context
Imagine taking a cross-country journey from New York to California.
No one in their right mind would set out on a multi-day road trip without looking at the weather, road conditions, construction, etc.
I want to know not just what’s happening immediately around my car, but what lies ahead.
Markets are the same way.
Some markets are for learning and some markets are for earning.
While every setup is important, I never lose sight of what’s going on around me. And that’s not just about what’s happening that day but over the last week and month.
I consider the themes amongst penny stocks, looking at what’s hot and what’s not.
To give you an idea, here are some questions I ask myself:
- Are OTC stocks working or just NASDAQ/AMEX stocks?
- Do I see any themes amongst the biggest spikers like AI or biotechs?
- Are promoters active?
- Is there a possibility of the broader market crashing soon?
All of these go through my mind. These questions give me the context around the stock.
Then, I look into how the stocks have traded including the success of my strategies.
- Am I seeing multiday runners or one-and-dones?
- Are morning panic dip buys working?
- How are the Weekend Trades working?
- Are bounces accompanied by heavy volume?
Markets aren’t some static thing. They’re dynamic, changing, and cycling all the time.
If I want to succeed, I have to adapt.
Here’s how that works with today’s squeezing stocks.
Create The Desired Ratio
Every trade is a balance of potential profits and losses.
I like to keep it simple and try for 5%-10% on most of my trades.
Knowing this forces me to do two things:
- Exit trades quickly when they aren’t working
- Get the best entry possible and set a stop very close by
I can turn a profit risking a 5%-10% loss to make a 5%-10% gain so long as I win more than 50% of my trades.
However, that’s tough for most traders.
That’s why I will often start with a better ratio where I’m risking 3%-5% to make 5%-10% in overextended markets and those I’m unsure of.
This forces me to wait for the best setups and entries.
And that’s the key here.
There are so many short squeezes happening, I can let the numbers work for me..
In a slow market, waiting for gorgeous setups with great risk/reward relationships might only provide me with one trade a week if I’m lucky.
Now, there’s probably 1-2 per day, and that’s MORE than enough.
You see, most traders feel this need to trade and end up jumping into every setup they see.
Squeezes can deliver some amazing runners. They can also drop like a stone.
That’s why I’m never afraid to cut loose any position that isn’t working the way I want.
Sure, I may breakeven or lose a small amount for a few days. But with the odds in my favor, I know the next set of winners will more than make up for those trades and then some.
Not only do I teach how to identify and trade setups, but you get EXCLUSIVE ACCESS to my real time trades.