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My Fallout With $WE And How I Rebounded

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Written by Timothy Sykes
Updated 9/13/2023 6 min read

I’m still sick to my stomach from when I was incredibly undisciplined with my trade on Tuesday…

When it comes to trading, I can’t express how important discipline truly is…

And once you stray away from it, that’s when everything can unravel.

That’s why today I want to break down how my lack of discipline on $WE ended up wiping away all of my gains on Tuesday…

And how I planned to rebound on Wednesday by focusing on what I know best.

Let me show you what I mean!

Over Trading

I started trading like a fool on Tuesday shortly after I missed a perfect breakout opportunity on WE.

Take a look at this chart…

Source: StocksToTrade

Since I missed the run-up, I decided to try and dip-buy this recent spiker in the afternoon…

WE spiked from $5 to $6.70 in less than 30 minutes!

That’s over a 30% move!

When I finally saw the run-up, I knew I couldn’t chase it higher…

Instead, I was trying to buy the dip from its highs.

On Tuesday, I bought WE at $5.97, and as it continued to fall, I knew it would be risky to add more size…

But knowing that, I did it anyway and I bought more shares at $5.67.

Just a few moments later, I had to exit my position for a $1,835 loss! (Risked $37,454.95).

Talk about a gut punch.

The reason I’m showing you this first is that I typically don’t dip-buy this late in the afternoon…

It’s all because I got FOMO from missing that run-up when it broke out earlier in the afternoon.

When a stock squeezes this much on a day, I knew I should’ve been patient and waited for what I expected to happen the following day, which is the morning panic.

Having Patience

Trading is all about discipline, knowing your risk, and having a game plan…

I want you to take a look at the chart below…

Source: StocksToTrade

WE spiked from $3 a share up to nearly $7 a share on Tuesday…

That’s over a 130% move in a day!

Knowing this, I should’ve never traded it once I missed the breakout from the previous High Of Day (HOD) Tuesday…

Here’s the chart to give you a better understanding…

Source: StocksToTrade

Dip-buying a stock at the end of the day is something I never typically do…

And the reason for that is that these afternoon plays aren’t nearly as predictable as a morning panic.  

Let me show you…

Yesterday morning, knowing how badly I screwed up my trade on Tuesday, I was patiently waiting for WE to have a morning panic…

And it happened, just like I planned!

Here’s the chart.

Source: StocksToTrade

I bought WE at $4.37 and sold it for $4.83 for a profit of $1,610! (Risked $15,295).

This is the perfect morning panic that I should’ve waited for…

Not trying to dip-buy a stock that’s spiking in the afternoon hours…

That’s like trying to catch a falling knife and it’s going to leave you with a bloody hand.

This is a pattern we’re seeing time and time again…

You have these short squeezes from the day before and it’s giving us these PERFECT opportunities…

The only reason I traded WE at the end of the day on Tuesday is because I had FOMO and knew I should’ve made more money on the breakout towards the end of the day…

And this is something I warn you about all the time.

Don’t chase after a play or make a bonehead mistake because you’re suffering from FOMO…

More Breaking News

Instead, be prepared and stay focused on what you know works best, and keep your emotions under control.

Lessons Learned

Most traders ignore their previous trades or move on to the next…

Or they simply call it quits after they make a mistake like I did on Tuesday…

But the thing is, I know that losses are part of the game and I knew I had to stick to what’s been working for me all along for the last several months.

I got way too loose with my trades and wasn’t disciplined enough…

And going forward, I know these morning panics are still the best opportunities out there.

So in the coming days, I’m going to stick with what I know is working…

And that’s why all of you should be attending these FREE trading sessions.

You won’t be successful if you’re guessing when to trade, or if you’re not being disciplined with your trades.

What you need to do is be ready ahead of time and be sure to focus just on those key setups…

And I’ll be sure to alert you what I see in chat.

-Tim

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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.
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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”