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Mentor Updates

Millionaire Mentor Update: Learn to Sell Into Strength

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Written by Timothy Sykes
Updated 1/26/2023 13 min read

If you want to grow a small account over time, you need to learn to sell into strength. Too many newbies get that deer-in-headlights look when a trade goes against them.

So even though my rule #1 is to cut losses quickly, many times I cut profits quickly. If that seems counterintuitive, keep reading. It could save you from big losses and potentially grow your account much faster. Not to mention reduce your risk.

Before we get to trading talk…

Animal Charities Don’t Take Days Off

Last week was a little busier for me. I was traveling around Florida and Georgia visiting several animal charities.

Sadly, after record charitable donations in 2019, 2020 has been tough. Roughly 80% of nonprofits reported a drop in revenue as of June. More than 70% had to cut back services. Things haven’t gotten better.

Some charities I talk with report a 60%–90% drop in donations. And some of the hardest hit are animal charities.

There are no days off for these charities. It’s not like they can deal with a 90% reduction in hay. The animals would starve. So that’s why I spent part of last week visiting animal charities like RVR Horse Rescue. Karmagawa donated $20,000 to support the incredible work they do.

Karmagawa had another proud moment last week, too…

Karmagawa’s 71st School Opens

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We’re proud to announce Karmagawa’s 22nd school/library with the Bali Children’s Project. It’s called the R. Wolf Learning Center after top student turned master, Roland Wolf. It’s also our 71st school. One school at a time, we WILL get to 1,000.

Here’s the school when the work was just getting started…

There was A LOT of work to do. This is how the school looks now…

I’m SO proud to donate and help kids get a proper education.

During the Holiday Season, Give What You Can

I know 2020 has been tough on a lot of people. But if you’re in a position to give, there will never be a better time than now. And if you’re not in a position to give, share those tweets to keep spreading the word. Together we CAN make a difference.

Some people ask why I’m so public about my charity work. It’s because I believe in the power of social media to spread the word. I don’t show our donations to brag, it’s to help people understand what these charities are doing.

Now let’s talk trading…

Trading Mentor: This Market Is Special

Usually, this section of the update is where I answer one or more student questions. This week is a little different because you need to take advantage of what’s happening right now.

It doesn’t matter if you’re brand new to penny stocks or an experienced trader. Wherever you are in your journey, you can grow one of your two accounts…

Grow Your Knowledge Account First

You have two accounts: your trading account and your knowledge account. If you already have the knowledge and experience, this is a time to push it. Grow your trading account while the market’s hot.

If you’re still learning, this is an amazing time to learn. Paper trade using StocksToTrade. At least watch the stocks my students and I trade each day to see the incredible moves.

Want to see me trade live for a whole day?

Your Last Chance for Market Mastery in 2020

The final Market Mastery 2020 live trading session is happening tomorrow, December 16. When you invest, you’ll get access to 12 full sessions. (One per month for 12 months.)

But this market is special…

I can’t promise any trades because I only trade when the setup is right. But if tomorrow’s Market Mastery goes anything like the rest of December, get ready. Watch me sell into strength and lock in profits along the way. So far I’m up $112,236 this month.* (Only June started better for me in 2020.)

(*Please note: My results, along with the results of my top students, are far from typical. Individual results will vary. Most traders lose money. My top students and I have the benefit of many years of hard work and dedication. Trading is inherently risky. Do your due diligence and never risk more than you can afford to lose.)

All the while, I’ll be explaining my thought process including…

  • What made me buy? (Assuming I take a trade.)
  • The news catalyst and where I heard it.
  • My goals for the trade — especially when to cut, when to hold, and when to sell into strength.
  • And more.

Click below to join me for the…

Final Market Mastery Live Trading Session of 2020

Study History to Prepare for the Future

I often say I’m just a glorified history teacher. That’s because you learn so much about trading by studying the past. One thing about 2020 is that there have been so many plays, it’s like compressing your trading education.

Check out these two videos to help understand how amazing this year has been in the stock market…

3 Rules You Need to Crush It in This Market

You can watch this one on my Facebook page…

December 2020 Penny Stock FAQs

Watch it now.

Trade Review: Sell Into Strength

Again, this market is special. But it’s also a perfect storm where people can learn the wrong lessons and promoters prey on newbies.

First, many newbies think you have to sell at the top. You don’t. All you need to do is take the meat of the move. (Which means learning to sell into strength.)

Sadly, unethical promoters take it a step further and claim, “Those who sell are weak!” Actually, the opposite is true. Weakness is going into a trade without a trading plan. Weakness is not having clear risk levels.

Want to know how my top students and I have grown our accounts over time? We sell into strength whenever possible. Learn to take profits along the way. Singles add up over time. Cutting losses quickly is the RIGHT thing to do. Selling into strength is the RIGHT thing to do.

Let’s review my biggest win from last week as an example…

Tesoro Enterprises, Inc. (OTCPK: TSNP)

TSNP has been an amazing stock in the past few weeks. I’ve made $79,964 trading it, mostly on morning panic dip buys.*

One of my TSNP trades on December 8 was my biggest win last week.* Here’s the chart showing my buy and sell alerts:

TSNP penny stock chart
TSNP chart: December 8, 1-minute candle, sell into strength — courtesy of StocksToTrade.com

As you can see on the chart, this was a classic morning panic pattern. My goal was to sell for 5%–10% on the bounce. It might not look like much on the chart, but the stock bounced 22% in nine minutes.

As I mentioned in my sell alert, I didn’t size in or out properly. And I only took 12% of the 22% move. But my goals, and more, were met. Even though I underestimated it, it was a $9,120 win for me.*

And it’s also a great example of what I mean when I say to sell into strength.

Learn to Sell Into Strength

If you can learn to sell into strength, it will take a lot of the frustration out of trading. My thesis is just plain wrong sometimes, but I still get a small win. Other times, I underestimate the move — like in the TSNP trade review above.

Either way, it takes the stress out of trading when you cut mechanically. With experience, you’ll learn to recognize a wall of sellers. You’ll know when you’ve overstayed your welcome. You’ll learn to sell before you hit the wall. Or at least as soon as you see it.

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(Not sure what a wall of sellers looks like? Study my “Learn Level 2” guide.)

That doesn’t mean you won’t have losses. And it doesn’t mean you won’t be dead wrong sometimes. But continuous frustration will be less likely. And … you’ll have a MUCH better chance to turn the corner to profitability.

So study my trades. Study Jack Kellogg’s trades. Study ALL my top students’ trades. Learn everything you can from Roland Wolf, Mike “Huddie” Hudson, Matthew Monaco, and Kyle Williams.

IMPORTANT: All my top students are part of the Trading Challenge.*  Apply here.

See how often we sell into strength even when we could’ve made more. It’s less stress, less pain, and more gain over time.

Millionaire Mentor Market Wrap

Like the rest of trading, learning to sell into strength takes time and experience. But once you start to lock in profits along the way, singles start to add up.

Plus, it gives you the opportunity to review your trades from a perspective of “What could I have done better?” As opposed to “Oh, crap, what have I done?”

Remember, when in doubt, get out.

Trading Education Resources: 30-Day Bootcamp

If you haven’t watched my 30-Day Bootcamp, it’s a great place to start. It has all the basics in one place.

Here’s what two 30-Day Bootcamp students had to say…

“Tim Sykes 30 day bootcamp, youtube, investopedia, books. I am also a millionaire challenge student for @timothysykes this has changed my life in more ways I can count. His lessons, chatroom, trading teachers, are the reason I have had success so far.” Emily Kirley

And this…

“Just want to thank you so much! Joined boot camp 2 weeks ago- made $878 on Tesla puts and $3893 on Nio puts!! So happy!”Selena Kellinger

Start YOUR 30-Day Bootcamp today. (Note: you don’t have to complete it in 30 days. You get lifetime access.)

Are you ready to learn to sell into strength? What do you think of this post? Comment below, I love to hear from all my readers! 

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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”