timothy sykes logo

Watchlists-Penny Stock Investment Strategy

The Hottest Stocks Right Now

Timothy SykesAvatar
Written by Timothy Sykes
Updated 1/8/2024 4 min read

There are HUGE opportunities to profit in the market right now.

Just yesterday we watched Nkarta Inc. (NASDAQ: NKTX) spike 60%.

It wasn’t the only spiker. Solid Biosciences Inc. (NASDAQ: SLDB) spiked 60% as well.

And there’s something that links these stocks together. It’s not the similarity in the spike percentage …

There’s a trend in the market right now.

We saw the same trend in 2023, and January’s volatility is exacerbating the pattern.

Now is the time to trade.

Most people think that small-cap price action is full of meaningless volatility. That’s not true.

There’s a specific process my millionaire students and I follow for profits.

  • We only focus on the best setups.
  • We follow specific trade plans.
  • We sit in cash until the perfect entry.

I’ll explain the details in today’s post.

This is how I profit from volatile stocks.

Keep reading …

Hot Market Trend

© Millionaire Media, LLC

The stocks at the top of my list are biotechs.

They were hot during all of 2023.

Specifically low-float biotechs. The low supply of shares helps prices spike higher when demand increases.

That’s why I made a play on $SLDB yesterday.

Ultimately, that trade ended in a loss. The details are below …

Source: Profit.ly

Yes. Even millionaire traders take losses.

Losses are part of the game.

That’s why we focus on the best plays. To minimize the chance of a failed trade. And we trade with patterns because the pattern helps us recognize a failed trade before it gets ugly.

If we can control our losses, the profits will outshine them.

If you check my Profit.ly account, where I share all of my trades, my win ratio is 76%. It’s pretty good. But nowhere near perfect.

  • I took a 1.82% loss on $SLDB.
  • But my wins can exceed 30%.

I’m still up on the year. So far I have $1,696 in total trading profits in 2024. A $180 loss is pennies on the dollar.

Plus, I was in the right place. I was watching the right stock. I’m following the right sector. I just need to stay patient and follow the process.

My Profit Plan This Week

© Millionaire Media, LLC

I’m following biotech spikers.

But I’m especially interested in multi-day runners.

The multi-day strength gives me more confidence when I’m trading versus a day-one spiker.

There are three muli-day biotechs I’m following in addition to the tickers that I shared earlier.

  • ReWalk Robotics Ltd. (NASDAQ: RWLK)
  • Inovio Pharmaceuticals Inc. (NASDAQ: INO)
  • Elevation Oncology Inc. (NASDAQ: ELEV)

And here’s the best part: The patterns that I use to trade never change.

The stocks come and go. They’re sketchy penny stocks, after all.

However, the volatility can follow the same patterns. Human beings are predictable. And thus, so are certain stock spikes.

There’s more than one pattern in play right now. On Monday I used this one. It ended in a loss, but the pattern kept my account safe

This next part is important: Depending on the price action today, I may use a different pattern.

All of these volatile stocks follow the same framework, but the patterns we use to trade them depend on where the chart is within the framework.

It’s not a complicated process. But it does take practice.

Here’s the good news …

In the beginning, my students were at the whim of the market. Trying these strategies on their own. But thanks to technological improvements, new traders can watch trading live streams to gain experience without the same account exposure.

We’re following the best setups every day LIVE.

Here’s the link.

You don’t have to make this journey alone.

Follow the path of other millionaire traders.

What’s your win ratio in 2024 so far? Honest traders build the best trading habits. Comment below — I love to hear from YOU!

How much has this post helped you?

Leave a reply

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”