As the market continues to trend lower and lower, you can see the fear spreading like wildfire among traders.
It’s a scenario that often sends chills down the spines of even the most seasoned investors…
But the good news is that it’s just another day in the office for us penny stock traders.
The overall market isn’t preventing these small-priced plays from soaring!
In just the last 30 days, I’ve made over $11,000 by following a set of unwavering principles that I swear by, regardless of the market conditions.
Today, I’m going to share with you these three critical rules that can make or break your journey as a trader.
So let’s buckle up and let’s get going!
Table of Contents
Play Small Ball
Now is not the time to be overly aggressive with your trades.
Other traders out there like to make fun of me for taking such a small position size…
Or trading like a coward and exiting my trades too soon.
The reason I do that is because I’ve been burned way too many times throughout my career by risking more and holding trades longer than I should…
Plus I’m also trying to teach important lessons to all of my students who are just starting off to help them better understand how this market works.
My strategy is geared towards those who have a small trading account.
There are multiple trading strategies out there…
And if you have a small account and want to learn from a trader who focuses on large-cap stocks…
That strategy isn’t going to be the best for you.
The best thing about trading with a small account and focusing on these low-priced plays is that you don’t need to risk a lot to make a lot…
And it doesn’t matter what the overall market is doing!
Unfortunately, way too many newbies don’t know how to manage their risk…
And if you don’t know where to start, I strongly recommend you join this FREE trading session to help give you a better idea.
I don’t want any of you risking more than you should on any trade…
Because one wrong mistake and you could see your trading account flash before your eyes.
For the majority of my trades, I take a small risk, and I’m just looking to lock in a 5-10% profit.
You’re not going to find those types of gains on a daily basis with any large-cap stock.
Trading is never an exact science, but you need to remember to take it slow and steady…
And to lock in your profits along the way.
Stop trying to swing for the fences every trade you make!
But remember, if any of your trades don’t go as planned, make sure you cut your losses quickly.
Have A Plan
Every day I start my morning by reviewing a list of stocks I’m watching and potential entries.
Now, that doesn’t mean every stock I’m waiting for will be tradeworthy…
But if everything comes together, I’m already prepared to take advantage of that opportunity.
For example, earlier in the week I traded Bionomics Limited (NASDAQ: BNOX)…
Source: StocksToTrade
I don’t know about you, but I wouldn’t want to stress holding onto this stock just to see my PnL going up, down, up, down…
That would cause me way too much stress!
That’s why I like to look for those morning panics.
I can’t tell you how many traders are just starting their day without having a plan in place.
They are just waiting to see what other traders are talking about and are just looking to copy their ideas.
If you do that, you don’t know what their exact strategy is…
And even if you get in at a good time, you don’t know how much they’re risking or when they plan to exit their trade.
All you know is what stock they bought, but then it’s up to you to guess when you should lock in profits…
And over time, that will not bode well for you.
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So before you start your trading, make sure you have a plan in place!
Don’t Get Greedy
Way too many newbies think trading is going to be easy and they will become my next millionaire student within a year.
There is a lot more to trading than just that.
You need to know what your entries are…
How to manage your risk…
What stocks have the best setups…
And know when to take profits when you have them.
Earlier this week I had a solid trade on BNOX.
And I didn’t do anything fancy, and any of you could make this same type of trade as I did.
Early in the morning, StocksToTrade Breaking News alerted me about Stevie Cohen investing in the company…
And if you know me, I typically don’t like to jump in right away, I like to see what the price action is like before I make a decision.
Here’s the chart…
Source: StocksToTrade Breaking News
I got in at $3.3267 and out for $3.65, a quick 9.7% gain…
And you can see the stock continued to go higher…
But my goal was to make 7-15% on this trade and I did, so I got out.
Source: Profit.ly
Way too often I’ve seen traders hold on longer than they should’ve and before they know it…
They see the stock go into a complete freefall.
We’re trading penny stocks, they are incredibly volatile so don’t be greedy with your profits, and make sure you understand the importance of locking in singles along the way…
Because there will be a time you wish you did.
Are You Ready To Thrive In This Market?
If you feel like there aren’t any opportunities when the overall market is tanking, you’re not alone…
Most traders think the same way…
But the best thing about penny stocks right now is that there are so many opportunities for you to choose from…
You just need to know where to look!
So quit guessing on what stocks to trade, where your entries are going to be, and how much to risk…
And tune into these FREE trading sessions to help you thrive in this amazing market!
I’ll see you in chat.
-Tim
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