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Mentor Updates

Millionaire Mentor Update: Simple Trading Tips Anyone Can Follow

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Written by Timothy Sykes
Updated 1/9/2023 13 min read

In this week’s update, I’ll share simple trading tips anyone can follow.

Before I get to the simple trading tips and the rest of the update, it’s important to mention that it’s Veterans Day today. Thank you, veterans, for your service and your sacrifices. We live in a free country and have great opportunities because so many people gave their lives to make it so.

I hope you took a moment of silence at some point today to honor all veterans. If not, take a minute now.

On with the simple trading tips…

These trading tips apply specifically to low-priced or penny stocks. If you follow them, I believe it will cut your learning time and help you avoid frustration.

As always, my goal is to be the mentor — to you — that I never had. Trading penny stocks isn’t rocket science. But learning the strategies takes time and effort. If you’re just getting started, get my FREE penny stock guide here.

At first, it can take a lot more studying than most people expect. If you get caught up studying or thinking about the wrong things, it can be confusing. So I hope these simple trading tips help you filter out some of the noise. To learn all my strategies and the nuances of trading penny stocks, apply for the Trading Challenge today.

First, a travel and charity update…

Another Week of Crazy Travel

My travel schedule has been crazy busy the past week…

Karmagawa Honored at Pencils of Promise Gala

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First, I traveled from Israel to Los Angeles — for 12 hours — to attend ComplexCon. Then I traveled to New York for the 2019 Pencils of Promise Gala: An Evolution Within. Karmagawa was honored this year. That’s pretty cool. But more importantly, the Gala raised another roughly $1.5 million for the charity.

I’m very proud of the work Karmagawa does to magnify charity through social media. And I’m honored to help the great charities we support. Do us a favor and get your hands on some of our charity apparel over at the Karmagawa store.

Another TradersEXPO Talk with Tim Bohen of StocksToTrade

After New York, I flew to Las Vegas for the TradersEXPO day trading conference. StocksToTrade’s lead trainer Tim Bohen and I presented twice on November 7.

Next, I’m off to speak at another conference (more about that next week). Then I’m off to Europe for another amazing foodie adventure. Again, I’ll share more about that soon.

Now, some simple trading tips anyone can follow…

5 Simple Trading Tips Anyone Can Follow

I keep getting questions from students about what they should focus on. And I keep getting questions like, “Tim, what do you think about this stock: [insert random stock ticker]?”

So I want to give you 5 simple trading tips that will help with those questions. And the answers to the student questions this week are also simple trading tips.

A lot of newbie traders try to focus on too many things at once. Others are just the opposite — they want the answer to be one indicator or one hot stock pick.

If you focus on too many things, or the wrong things, you’ll end up getting frustrated. But at the same time, you can’t just focus on one indicator. You have to learn all seven indicators in my Trader Checklist guide. (Hint: get your copy of Trader Checklist Deux here. Get access to my full video lesson library when you subscribe to PennyStocking Silver on Profit.ly.)

So stop focusing on random stocks. If you could narrow it down to one kind of stock to look for, one pattern to understand, it’s this…

Focus On Supernovas

Simple trading tip #1: focus on supernovas. Remember, I have very specific patterns inside these supernovas.

Twitter user @Vetting4Success has the right idea…

A majority of my trades (if not all) come from knowing which part of the supernova I trade best. That’s it. Simple. Stop looking at random stocks. Find the low-priced supernovas and watch them like a hawk.

Know Your Penny Stock Supernovas

It’s called a supernova because it’s when a stock just explodes like an exploding star. With a supernova, the stock goes up 5, 10, 20 … even up to 50 times. We’re not talking 15% on the day.

Some of you are looking for stocks that are up 15% on the day with no history of spiking. That’s not a supernova. I want to trade stocks with the biggest moves because it gives me the best opportunity to partake in the meat of the move.

What can you do today, this week, this month, this year … to put yourself in the best position two years from now?

Your job is to spot supernovas. Watch supernovas. Learn from supernovas. Then it’s your job to test different theses and strategies based on the supernovas. After that, optimize your trading of supernovas. Over and over again. (Bonus simple trading tip: keep a trading journal as part of the optimization process.)

Understand the Twitter Pumpers

Simple trading tip #2: beware of fake gurus and/or Twitter pumpers. Twitter pumps have become such a nasty part of the industry I wrote this post about it. Remember, hold & hope is not a strategy. So even if you play one of these, stick with your plan and follow rule #1: cut losses quickly.

Just the other day Twitter user @hsurofalati said this:

Now for some…

Trading Questions From Students

“Hey, Tim, I’ve seen a lot of premarket spikers. Some keep running after the market opens. I don’t see you trade premarket —  why is that?”

Simple trading tip #3: premarket is too speculative.

Why? There aren’t that many trades happening. And the market is very illiquid. Say there’s not a lot of volume, but you decide to buy a stock based on good news. Or what you think is good news — because you see the stock going up.

But what happens when the market opens? All that premarket strength disappears in the first minute of trading. Maybe it drops so fast you can’t get out without a big loss. It’s just a lot of risk to take.

So I like to look at premarket moves like this…

If I see something trading strong pre-market, I look for the news. Why are people interested in trading this stock before the market opens? Why is this company in play? Is the news something I’m interested in?

There are times when I have traded premarket. For example, when the news was so good that I thought when regular trading opens people will buy. It’s kinda like another type of informational inefficiency. But it’s very rare for me. I prefer to wait until the market opens and see how the stock reacts first.

Think of it like this … until you really have my patterns down … and until you know my rules … and until you know how to use the seven indicators found in my Trader’s Checklist guide … and until you start to refine your process…

… trying to trade premarket just adds a layer of unnecessary risk. A risk you should avoid.

I might watch stocks spiking big premarket. But I’m never gonna trade random spikers like that. That’s what degenerates do. So control your degenerate self.

Next question…

“When a company changes tickers (like DCGD to GRNF), does it typically create a recognizable pattern?”

Simple trading tip #4: when a company changes ticker, the pattern is … stay away.

Some brokers don’t even recognize the ticker change right away. You don’t wanna be involved. You might have the perfect win, and you’re not even able to take it. And by the time the broker recognizes the ticker change, your opportunity is gone. (I use these brokers.)

Worse, what if there’s no opportunity? What if you’re wrong and the stock crashes and you still can’t get out? Now your potential small loss has turned into a disaster.

So when you can’t control the risk, stay away. Like when you buy speculative crap premarket, or a ticker change, or you try to guess earnings … these are things that make your risk too big to trade.

Some traders like it because it’s exciting … because they like gambling. But if you wanna get wealthy over time, don’t take the most exciting trades. Instead, take the most predictable trades. Take trades with limited risk. (Maybe I should have added good trading is not exciting trading to my list of simple trading tips.)

No one trade is so amazing that I can just throw all my risk metrics out the window.

Millionaire Mentor Market Wrap

There you go, another update in the books. I hope you’ve learned something from these simple trading tips. And I hope you have a great week of studying and trading.

If you haven’t read “The Complete Penny Stock Course” by my student Jamil, please get it and read it. It answers many of the questions I get asked regularly. And it blows my mind more people haven’t read it.

(Bonus simple trading tip: “The Complete Penny Stock Course” is packed with information I often write about. For example, supernovas are covered on pages 166–169. So do yourself a favor: get it and study up.)

Comments from Students

Comments on Video Lessons

One of the great benefits of subscribing to PennyStocking Silver is access to the library of video lessons. So this time, I want to share a few comments from students after I posted my latest video lesson.

08:43 AM redwagonrider → timothysykes: Thanks tim for another great video lesson. perfect execution on a substantial portion of yesterday’s move. I didn’t trade ALPP in the runup, or on the bounce. Your video lesson https://profit.ly/content/premium/20342a reminds me that If I want to truly succeed at nailing the lessons that you teach. When we have a ticker like ALPP $KBLB DCGD $EDXC SUNW etc… Those have to be my #1 top priority that I am focus 110% of my energy and study time on.

08:50 AM SatelliteIncomeUnlimited → timothysykes: thanks for the video lesson!

08:56 AM FabioVanni → timothysykes: thanks tim for all the tips, lessons and watchlist that you are posting every day.

12:59 PM CippoNK1K: As a new Challenge student watching this video, a big thanks for the info!! I can see it pays to focus on the best patterns!

Comments on Trading Challenge Webinars

One of the great benefits of joining the Trading Challenge is the live weekly webinars. These comments came during and after my most recent Trading Challenge webinar…

02:59 PM redwagonrider → timothysykes: I am in the Middle of watching Spikeability DVD. Love that you refresh on all the rules and primary lessons that you introduce in your 1st dvds. Especially like the emphasis on news that is easy to understand, because others can understand it and get in on it. looking forward to getting to the meat of the dvd.

03:12 PM _Stitch_ → timothysykes: Just want to compliment your support staff and gurus here, including yourself. There’s a lot to learn. It’s overwhelming and it’s a unique journey for everyone but it’s been made so much easier with everyone here. Slow and steady for me. I’ve come a long way in 6 months since I started.

03:22 PM P70KCJ → timothysykes: I lost $500 on my 5th real money trade, because i traded an iliquid, bad longterm stock that i shouldnt have been in in the first place. Too big position, and wrong strategy. I even cut losses too quickly because it bounced within 1 minute, but no regrets. I got great feedback from you, TL, TB and Mark. And now my learning curve just went supernova. Thanks to all of you.

03:27 PM Filodlesa: Been struggling to stay consisted living in Australia & being on US market. But, will definitely trust the process and focus on the long term result. Thanks Tim & team

04:02 PM _Stitch_ → timothysykes: Great webinar mate. Thank you.

04:02 PM TonyG1 → timothysykes: Thanks Tim…Excellent, excellent excellent webinar…C ya Monday Normal trading hrs or Veterans Day!

[Please note: Students’ results aren’t typical. These students put in the time and dedication and have exceptional skills and knowledge. Most traders lose money. Always remember trading is risky … never risk more than you can afford.]

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”