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Trading Lessons

The Next Surge On A Hot Stock

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Written by Timothy Sykes
Reviewed by Jack Kellogg Fact-checked by Ben Sturgill
Updated 9/4/2024 4 min read

I first traded BranchOut Food Inc. (NASDAQ: BOF) on August 28 when the company announced a 640% revenue growth from the first half of 2023 to the first half of 2024.

Plus, the announcement included plans for future growth and debt elimination.

Even traders with minimal experience could recognize a bullish catalyst like that!

And if they didn’t, my trade on day one should have alerted them to the upcoming possibilities on the next surge higher. These stocks can spike for multiple days.

Take a look at my trade notes below:

Source: Profitly

Again … My trade on August 28 left traders with more than enough time to watch this stock and plan a follow-up trade.

Here are some examples from students in our trading community:

Source
Source

And in case you hadn’t noticed … The chart for BOF is still in play.

In the image below, every candle represents one trading minute:

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

The Next Opportunity On BOF

This chart is in a different spot than it was when I first traded it.

And it’s in a different spot from my second trade yesterday … See my notes below:

Source: Profit.ly

There are still opportunities to profit!

But we have to approach these setups carefully.

At the end of the day, this is still a volatile stock (the spike already measures 510%*). A misstep could spell disaster for our trading account.

Luckily, there’s a common framework that we can follow.

The most volatile stocks in the market like to follow specific patterns because the people trading the stocks are predictable during times of high stress. Like when they have a few thousand dollars in a +100% runner …

As traders, it’s our job to step back and recognize these emotions as they manifest in the market.

How To Recognize These Setups

timothy sykes in matera in 2022
© Millionaire Media, LLC

Now … Stocks like to follow these patterns, but every spike is still unique in some way, like a snowflake.

The more spikes that a trader sees, the easier it becomes to recognize these patterns in real time. Until then, my newest students are using AI to track this price action!

Think about it, the stocks follow the same patterns over and over again.

All it took was a few months to train an AI to follow the same patterns.

Enter the BOF ticker into my AI bot and it will spit out a trade plan as if you asked me directly.

And it works for ANY stock that you’re watching.

Understand … If you pick the wrong stock, my AI will tell you.

My trading process only focuses on the hottest trade setups.

There aren’t trade opportunities all day long on every stock. If you try to use my AI to trade a crappy play, the bot is going to tell you that it’s a crappy play.

Don’t take it personally. Use that information to grow and learn!

There are opportunities at your fingertips right now!

>> Use AI to track the hottest setups following our stock patterns <<

Now is the time to trade with training wheels …

The market is heating up, since we’ve made it out of August. And we’re approaching a holiday season coupled with a volatile election.

Learn this process before the true profit opportunities show up!

Cheers.

 

*Past performance does not indicate future results


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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”