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Trading Lessons

The Key To My Profits On A Down Day

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Written by Timothy Sykes
Updated 7/22/2024 5 min read

There are still profit opportunities when the market dips, like it is now …

Take a look at the S&P 500 ETF Trust (NYSE: SPY) chart below, every candle represents one minute:

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

And I’m not talking about short selling.

Yesterday I used a classic long-biased trade pattern to profit off of a multi-day spiker despite the down market.

Plus …

  • I don’t have to hold through big swings.
  • I’m not even in these stocks for very long.

Yesterday I made 3% in a matter of minutes. Then I went about my day.

That’s how I trade: I pull 3% here, 5% there, maybe a +10% every now and then. And I don’t have to watch my screen all day long.

I only focus on the best setups.

And then I hang out in Italy with my millionaire students. See my post on X below:

There are still opportunities to profit right now!

The recent market dip isn’t an excuse to slack off. Keep growing and learning!

How I Profit Right Now

Tim Sykes checking his top penny stocks list in Italy
© Millionaire Media, LLC

I already touched on this idea earlier in the week. This is the blog post.

We only trade stocks that have a reason to push higher right now.

On July 16, Silo Pharma, Inc. (NASDAQ: SILO) announced a global license awarded for its Alzheimer’s therapy. The price spiked 150%* that day and then started to consolidate.

Pay attention to stocks that spike and consolidate!

I didn’t trade the price action on the first day of the move. Instead, I waited until the price action confirmed a strong breakout …

On July 18 the company announced a new business agreement to pursue a therapy for PTSD. And when the price started to run, I knew it was time to make a trade.

Take a look at the chart below, every candle represents one minute:

SILO chart multi-day, 1-minute candles Source: StocksToTrade

The total spike measures 320%* so far …

My trade notes are below:

Source: Profit.ly

Attention: When you find a stock spiking with recent news, put it on a watchlist!

These plays can break out after a few days of lazy consolidation. Traders who stop paying attention are likely to miss the follow-up move.

SILO isn’t the only setup that matches this framework. I have another example of a multi-day runner with hot news: Yoshitsu Co. Ltd. (NASDAQ: TKLF).

The company announced bullish earnings on July 16. Then it consolidated on July 17, and broke to new highs yesterday. Take a look at the chart below, this is a 180%* spike so far:

TKLF chart multi-day, 1-minute candles Source: StocksToTrade

These multi-day runners follow my trading framework perfectly. That’s how I’m able to build smart positions.

Follow My Trading Framework

© Millionaire Media, LLC

The most volatile stocks in the market can follow specific patterns that are based on human psychology …

People are predictable during times of high stress. Like when they have a few thousand dollars in a stock spiking +100%*.

See, I’m not a math genius, I wait for the price action to match my patterns.

And in 2024, there’s a way for new traders to follow these patterns immediately! You don’t need years of schooling or some kind of fancy degree.

One of my student’s testimonials is posted below:

“Bought ANVS on Friday at $10.97 and sold today at $15.26. Even though the target was $16+. Been with the service for about 1 month.”

– Don Alexander

That’s a 39% profit over the weekend from an automated trading scan, a scan that follows my process. Incredible!

>> Use AI to build smart positions on the hottest stocks <<

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”