My Answers To 10 Important Trading FAQs
- [Tim] Hey, Tim Sykes here, just wanted to answer some of the questions I'm getting, feel free to throw out questions. You know, my team will just put all of them in documents like this, and then I can make more videos like this, so by all means ask questions. I think I'll start doing like these kind of question and answer videos maybe every other week to start, we'll see how many questions we get, but I want you to be successful, you know and don't feel bad if you have any basic questions, you know, you have a lot of materials to study and there's always plays to really learn from every day, but you know, understand this can be overwhelming, especially in the beginning. It's hardest in the beginning, if you truly want to succeed, you're gonna have to get through the tough part of the confusion, of the fast moving stocks, of sometimes losses. Ideally, you know, following rule number one, which is cutting losses quickly, ideally starting with a small account in the beginning, so that any mistakes you have are not, you know, account crushing, or ego crushing, you know, there is a reason why I teach the way that I teach.
Most of my top students who are having success, they're in year two, year three, year four, year five, you know, you have to see different kinds of plays, plays where you nail it, plays where you miss it, plays where maybe you get a partial execution and you all just understand over time what you're best at. And this is the toughest part for me as a teacher, you know, I'll get to the questions in a second, but I just wanna help everyone understand, every single person watching this video is different. I can't tell you, you know, what's gonna work exactly for you, you know, you have different strengths and weaknesses, different personalities, different goals, different account sizes, we're all in different time zones, but the one thing that kind of unites us all is this desire to learn, this desire to, you know, utilize the stock market, and try to accumulate wealth, realizing that 90% plus of traders lose, realizing that, you know, most people who say, "oh if you just want to make money in the markets, just invest in like the S&P 500, it goes up eight to 10% per year."
But if you have a small account, eight to 10% per year is crap. You know, if you have two grand, if you have three grand, if you have 10 grand, what, you're gonna spend your whole life making a thousand, 2000 a year, maybe 3000? And then, you know, maybe if it compounds over time, maybe by year 20 or 30, (laughs) you know, you're making an extra 20,000 a year, like it's just not really going to, you know, change your life the way that it's changed my life and my top students lives, and I understand that it sounds crazy. And you know, I also understand I only have a few millionaire students, but remember most of my students start with 2,000, 3,000, 4,000, 5,000 dollars. Like people are like, "oh you know, you only have a few millionaire students."
Yeah, it's tough to grow a few thousand into several million, it's tough to grow your account exponentially, even if you turn 2,000 into 10,000, that's tough, and 10,000 is a long way from a million. So you have to start to understand what this journey is all about, and that's why asking questions, you know, is part of it, missing trades is part of it, learning to lose small is part of it, you're investing in your future, in your education, in your knowledge, that's what this is all about, it's not just about money, you need enough knowledge. God forbid you make too much money too quickly, and maybe you get lucky on one stock or you go all in and you break my rules and you use leverage, and you make money the wrong way, you'll probably lose it on the next trade or two trades or five trades because you don't have enough knowledge to keep the money and grow it the right way. So it's not just about how much money you can make, there's so much that goes into this, and this is why I love teaching because I'm gonna go over every single aspect.
All right. So first question, with so many former runners, potential panics on any given day, what type of alerts are you setting? This is a great question. It is an overwhelming market right now.
I'm looking for the biggest, recent percent gainers over several days, you know, like VTVT is an example where it spiked pretty much all Thursday afternoon and then Friday pre-market, and then when the market opened, it did exactly nothing. So this was a very common thing lately, where you have these these kinds of quick spikes and drops, like THCT also did this, I mean, this thing quadrupled in 20 minutes on Friday morning and then crashed, I'm not a big fan of trying to dip by these kinds of one day, or even like one morning runners, the best stocks that I'm looking at right now, RSCF, you know, this has gone from 50 cents to 2.50 basically, you know, in four trading days, so multi-day winners and you can keep track of multi-day winners. TSNP doesn't look that great over three days, but over 14 days, you can see, you know, this thing is up from 2 cents, so this one has gone up 10 times, not exactly perfect, you know, but this one actually has worked pretty well for morning panics into dip buys every day. But you also have to have the right mindset, you know, TSNP has had these morning panics, but, you know because it's so choppy, and because it's frankly not a hugely highly priced stock, you know, the the morning panic is like 2 or 3 cents a share and the bounce is maybe 1 or 2 cents a share, so don't expect that, you know, this thing trading at 20 cents a share is gonna bounce, you know, 50 cents a share, that's just not realistic.
So I'm looking for multi-day winners, as opposed to a one day or one morning winners, and you know understand there's still a lot of multi-day winners, but that's why I give you my video watch list every weekend, and you can track it. You know, you can look at any stock that's doubled, tripled, quadrupled, quintupled over the past two, three, four days. What are the different risk levels you heard? Risking Low of the Day, VWAP, High of the Day break. I don't like any of those, for me I am so scared of these volatile stocks because any stock that I'm in, you know, has likely moved 50, a hundred, 200% in the past few minutes, hours or days, so I trade scared, I don't risk, you know, specific levels.
I don't say, "oh I have an 8% loss when it gets to 10%, I'll take it." I know my patterns inside and out, so I really clamped down, like if I'm down even a hundred or 200 dollars, you know, that's a better way I think, where you judge based on your own dollar amount, and that's again, a different answer for everybody. What is your say uncle point, where you're like I don't wanna lose more than a hundred dollars. And if you look at all my trades, which are public, I'm not losing more than 100, 200, sometimes 300, 400 on a trade, and I'm a multimillionaire. So if a multimillionaire is only willing to risk losing 100, 200, 300, 400, how much should you risk? That's up to you, again, I am not you, you are not me, we are different, but for me I really want to be extra careful, I don't care about any of these levels, I know that other traders are looking at those levels, I wanna be out before any of those levels are breached. It's a safe way of doing it, It's a scared way of doing it, but I understand sometimes I do miss plays because I'm so scared and I get out, and then the stocks run big without me, so I prefer the ultra safe approach, where sometimes I'm gonna miss trade, but I really clamped down on my risk.
Is there a place to find all the tickers in one sector? If you want to know all the EV plays, I'm not really interested in an entire sector, I'm interested in whatever stocks are moving. And I highly encourage you to use StocksToTrade, if you go to stockstotrade.com, you can check out the software, they have the biggest percent gainers, there's a lot of different websites that have the biggest percent gainers, but stockstotrade.com specifically is made
for low price stocks. Many of these other scanners, they're just not, and so you miss out on like the best plays like TSNP, I can't tell you how many messages I got from people being like, "you know, I'm using this free website and it doesn't have TSMP." Yeah, that's what happens when you use a free website, you know, you wanna cheap out on your tools, you wanna cheap out on your education, you're sometimes gonna miss the absolute best play in the entire market, and I think that's a mistake. Two-part question, when you say study and master the patterns, supernova, stair stepper, snore, crow, is there a specific candlestick pattern that I should look for when I indicate the potential start of these patterns? Or do I look for and master reversal patterns, proceeding, shooting star? I don't really use shooting star, hammer, doji, all that stuff, you know for me, I specifically look for supernovas, there's more supernovas than I can deal with right now, this is a good problem to have, but it's still a problem.
And I don't look for the exact start of these patterns, you know, I'm looking for percent gainers already recognizing that, you know, the bigger the percent gain and ideally the news catalyst, the more it can keep going. And this is a counterintuitive thought because people are like, "what? what I wanna be there before the big spike," but the first big spike alerts me to the fact that it can spike more. It's very strange to think about, a lot of the best lessons that you'll learn in this game, you know, are counterintuitive. Let me bring up a SFOR for example, right? So stocks are trade breaking news, another one the reason to use StocksToTrade, they have a breaking news tool, I'll post the link below this video, but they alerted the news here, SFOR has a wannabe zoom product, it's probably gonna fail, it's probably gonna stink, it'll probably bomb, whatever, it's untested, it's hyped up and it's upcoming, so it's an upcoming news play. I believe that they're debuting it on December 18th and you know, StocksToTrade breaking news alerted this thing at a third of a penny, and it started spiking.
I was actually at an animal sanctuary all day, I don't know if you follow me on social media, but I've been going from animal sanctuary to sanctuary lately, they really been hard hit by 2020, so I'm trying to give them some holiday gifts, I dress up as Santa and I I've gone to, I don't know half a dozen now, there's still some more to go to and I'll post all the photos and videos, 'cause they really need help. But I was at an animal sanctuary, we were heading home and I was just looking through, you know, my big percent gainers. I didn't see this StocksToTrade breaking news alert when it happened, I didn't see the news was when it happened, but I saw it around a penny-and-a-half, right in here, and it had already gone up like 500%, and some people will be like never buy a stock up 500%, maybe in a different market that applies, but in this market, a stock that's up 500% can keep going, so it doesn't matter if you're at an animal sanctuary or whatever your busy life you're living, this is the beauty of knowing the patterns and having the right tools, and I bought it on a dip here, just off the highs, it had already gotten to the twos and I got it at one seven, and it kept going and I was scared, I was trading from a gas station, (laughs) and I sold it in twos again, and it actually finished in the threes, and then the next day it goes to the elevens, so it didn't matter if you saw it at a third of a penny with the StocksToTrade breaking news, it didn't matter if you saw it at a half a penny, or a penny or 2 cents, the biggest spike was the next morning, so you don't have to be there right away, and now, even Friday it had a massive spike and I was buying it, you know, Friday into the close and selling it too soon. You know, I bought it in the nines here on the breakout, I'm thinking it could retest the highs here at 11, five, and probably, you know, fail, but it kept going and it failed for a little bit, and I sold locking in safe profits, and then it just kept going to 14, eight, and by the time this opens, this could be like 18 or 20. I don't know how high it goes, but I recognize these patterns.
So you do not have to be first, you know, like you say, like indicate the potential start of these patterns. It's good if you're there, you know, if you're not at an animal sanctuary, if you're by your computer, you should use StocksToTrade breaking news every single day, you should be kept up to date, but it's not imperative for you to be there right in the beginning. It's imperative that you know these patterns inside and out, and between all my DVDs, video lessons, webinars, blog posts, watch lists, commentary, trade alerts. You know, I don't know how you don't understand these patterns, if you put in the time studying, I'm nothing more than a glorified history teacher, and I'm teaching you the history of these patterns, the history of this niche, so some people are like, "oh, Tim I don't want to watch a DVD from six, seven, eight years ago." Why? You don't wanna study history? You know, it's no different than if you're a history student and you're studying the Egyptian empire, the Roman empire, the Ottoman empire, you're learning from history.
And with what I teach, the way that I teach, I'm showing you pattern after pattern, play after play. SFOR is not the first or the last upcoming news play, it is kind of an upcoming news event play on steroids, you know, going from a third of a penny now to 15 cents, you know, that's 45 times your money in four days, in case you're doing the math at home. So we're in this kind of crazy market, but you don't have to be there right at the beginning, you can take profits along the way, I mean, this was a fantastic dip by here, here in the fours, you know, and you triple your money basically the next day, which is crazy. Understand, this doesn't always happen, okay? This is a bubble market, so it's important, even if you miss these plays, it's important for you to learn from them and to witness them, like I said part of your education is gonna be missing plays, like and I know it doesn't feel good, but it's essential. So if you're going back, let's say 5, 10, 20 years from now, and you say, "okay, what lessons did I learn?" And you have like a whole list of check boxes, you can now check the box, and be like I watched SFOR and missed it.
Or maybe, you know, I watched SFOR, I tried to buy it, I got a partial execution, or I traded SFOR and I bought it, and sold it and nailed it, and then it kept going, or you know, I bought it and I still have it, and then you learn from that, you need to learn from your missed trades, from your made trades, from your partial trades, it's all part of your journey, it's all part of growing your knowledge account, so that you can be better prepared next time. How did I know to chase a stock up 500%? Because I've been in bubble markets before, in non-bubble markets, I would never chase a stock up 500%. I was trading from a gas station, where the wifi was going in and out, It's actually pretty funny, I posted the video somewhere, I have my videographer Quinn, who came to the animal sanctumerries, animal sanctuaries with me, sorry there's a lot going on.
I've had two coffees before I filmed this video, (laughs) FYI I'm trying to just keep up, but you know, he was like, "are you sure you wanna do this from a gas station?" And I was like, "I'm doing it Quinn." And you know, I made a few thousand dollars on that quick trade and I totally underestimated it, and I've been doing this 20 plus years. So if you underestimate any play, do not feel bad, it happens to the best of us.
What is the proceeding pattern I should learn first ? Learn all patterns, so many people are like "should I just learn this one pattern? Should I just learn this?" You have to start trying different stuff, I love morning panic dip buys, okay? I love 'em, I'm profiting the most off of them, if you go through all my trades over 20 plus years, I've probably made the most off that pattern, it just makes sense to me, and now I have so much experience, but you know, in a different market I might revert and go back to shorting first red days, I think shorting right now is very dangerous, I think it's very risky and crowded, but the market changes. If you're truly gonna be wealthy over time, you have to be willing to change, you have to be willing to adapt. I don't want anybody watching this video to just learn one pattern, and be like, "oh, I'm set for life." You're always gonna have to adapt, and that's why you're always gonna have to learn. The good news is, like I said at the beginning of this video, the beginning of your journey learning is the hardest, you know? I've taught some really lazy degenerate students, and I say that in the most affectionate way possible, but you know, even by year two, three, four, five, like if they stick with studying, I mean they start seeing patterns repeat, they start seeing things and it starts clicking, but you have to get to year two, three, four, five.
I also have a lot of students where they're like, "oh, I'm not making money," after one week, two weeks, three weeks, one month, two months, three months, and they give up, or they take their education less seriously. I think the best example is Tim Grittani, my top student, who's over 13 million in profits, you can see all of his trades, he followed my rules to a T, he learned everything, he started small, If you go back and look at his early trades, it's funny 'cause he's making and losing 10, 20, 30 bucks, but now he's over 13 million, 'cause he started small. he optimized, he learned his patterns and then he sized up later on, and that's a decade long journey.
But I think if you ask most people, would you like to make $13 million over a decade? And you know, he's made 3 million this year and you know, taking the past like four months off to spend more time with his family, I think most people would say yes, but it took a lot of dedication, and time and effort in the beginning. What does a red to green pattern look like, aside from the colors is there a candlestick characteristic? (laughs) No I mean, it's a color thing, it's a momentum shift. When you go red on the day to green on the day, it's a very big shift. I'm trying to think of a stock that actually did it. It's a tougher chart, it's a tougher thing to do. TSNP, I guess is a good example, where this one panicked on Friday, you know, the previous close was right here in the sixteens, it dropped to the thirteens, and then you can see here hanging at 15, so even though it's bounced 2 cents a share, like I said this is how this stock tends to bounce.
It really started its big run up when it went red to green right here, you know? And again, intraday the candles, I'm sorry for these typos, I mean, this is just penny stocks. It's not actually trading at 26 cents, this is a late print, so don't even ask me questions about that. But the biggest move here was when it took out the morning highs and like kind of like this unchanged level right in here, at around 11:00 AM and it went from 16 up to 21, so this is the momentum shift where it took out the day highs, or the morning highs, right around here in the sixteens, and you can see here, it actually went from like 16, eight, and then kind of stutter stepped, it went down to 16, you know, this was at 1103, and then by 11:12, I mean 10 minutes it's just sitting here and it's kind of deliberating whether it wants to go green on the day, or you know, if this bounce is gonna fail and it's gonna come back down to the thirteens or fourteens or fifteens. And instead what happens here at around 11:12, 11:13, it makes new highs here on the seventeens, and then it gets ahead of itself up to 20, comes down to 18, back to 20, so this is a really key level, it's not any one candle, again it's the whole process, it's how it you know goes from red to green, no one candle matters, it's the trend.
Can you please help me learn, read level 2? What am I looking for? I have a whole DVD called "Learn Level 2" DVD, it's a complex issue, it's not an exact science, but if you were watching, you know right here, we can judge based on the chart and based on the candles here, but you know, you can see here, it went down to 1606, you're basically looking for a wall of buyers on the bid, and you're looking for that wall to build itself, so there's more and more buyers, and you know, the sellers on the ask at the 17, start getting chipped away until all of a sudden, you know the seventeens disappear, and it goes to the eighteens, nineteens, twenties. It's a momentum shift kind of thing, but I highly do encourage you to watch my "Learn Level 2" DVD, again, it's a few years old, but level 2 hasn't changed much since then. And that's I think six or seven hours, so that's why if you ask me like, "well, why don't you just explain it now?" I'm not doing a six or seven hour video lesson right now, when I've already done it. Do I use cup and handle patterns at all? If so, can you explain it? I mean, this is kind of a cup and handle too, this is an intraday cup and handle, where you have the left side of the cup, you have the bottom, and then you have the handle, and then the key here is not necessarily right at the breakout level, but you want it to, you know, obviously uptrend whether it's red to green, or breaking the day high, or breaking a multi-day high, or breaking a multi-month high, you're looking for something that indicates a momentum buildup, but I do like this, when you know, you have this kind of handle situation, where it breaks the day high and then it consolidates, this consolidation is so beautiful because it lessens your risk, it shows you if somebody wants to sell, like you know, if there's enough sellers it'll just fail at this key level, very similar to late day SFOR, when you know it topped out here at 9 cents, and topped out here at 9 cents, and then it broke 9 cents, came up to nine, seven, and then you can see here, it's hanging in the nine, and, and I actually bought it here in the mid and low nines because it had successfully broken out and successfully consolidated and it looked like it could keep going, which it did. I underestimated it, I didn't think that it would spike, you know, 50% into the close, I was buying it in the nines, selling it in the tens buying it on the dip here in the elevens, selling it in the 13 area, and now it closed at 15. And you know, given the close, I think this thing can gap up even more, but it all started, you know, with this little breakout and this consolidation and this breakout hold and then the follow-up, so this is an intraday cup and handle, it doesn't look like it, but it doesn't really matter how low the bottom is on the cup.
The key is you wanna see a breakout over the previous highs, and then a dip ideally to lessen your risk, to give you more time to enter, and then you have follow-up spikes from people who are less and prepared. When I'm watching the 30 day videos, Matt asks, why you didn't put more info on swing trades, you replied because students didn't know when to sell it, I would appreciate more education. Ah yeah, I mean I stick with my answer, I still don't even know swing trading that well, like this is a great example, where I already saw the breakout, I bought it and I sold it for like 15% twice, I had two separate trades here and the thing spiked 50%, so I personally am not great at holding longer, I'm really good at locking in 1,000, 2,000 dollars at a time. So I'm not great at it, I can't really talk to it. And also you know students, I don't really see that many students doing it that well, Tim Grittani has really excelled because he has given more patience to these plays, he's taken more size and he's given more patience, so I would encourage you to watch his guide, it's called "Trading Tickers" and it's fantastic, but I can't teach what I'm not great at. And I, you know again, I'd also don't think, I would caution you to say like, "hey okay, I wanna you know, make 13 million like Tim Grittani."
He was not a swing trader in the beginning, once he had enough of a cushion of cash, then he could take on more size and have more patience. In the beginning, he was very much a sniper like trader like myself, and I think that it's better when you have a small account in the beginning to be meticulous, to be sniper like, not to necessarily try to be a swing trader, especially in this crazy market, because even though he's made 13 million he has a lot of bigger losses, which you know, because of his experience, because of his education and skillset he can handle, but most people who try to tackle that, they just can't, no different than short selling, I know a lot of short sellers who have made a lot of money, but right now as a newbie, as someone who's learning, as someone who is seeing these stocks spike up much more than we're used to, I think short selling is very dangerous. So it's not just one size fits all, who can make the most money, you have to do what's right for you at the proper point in your journey. If you've made less than $50,000, if you've made less than 500 trades, I would not be a swing trader, I would not be a short seller because those are advanced techniques, and also I should mention no matter how advanced you get or experienced you get as a short seller, I know many short sellers who are blowing up right now, they're losing everything. So I think it's dangerous for anybody, even if you're experienced, but swing trading, I mean, you obviously have to have more patience and respect your risk levels, but again, I don't think it's a great strategy.
I'm trying to help you the most, I'm not trying to avoid questions, I'm trying to create the most successful students, It does mean no good if a student's like, "oh, I wanna be a gunslinger, screw Tim's boring meticulous strategy, where oftentimes he sells too soon, let me go bigger." And then you blow up, I would rather you learn to take small singles, single, single, single, single, instead of going for home runs, but you know, you gotta do what you gotta do. All I can do is try to teach you from 20 plus years of experience, and in my experience a lot of newbies, they're very stubborn and they don't wanna listen to reason, they don't wanna listen to my rules 'cause a lot of my rules, you know, they're frustrating, it's not fun to take losses sometimes, but I think it's essential. What do you look for when finding the right stock? What time of day to buy? Guessing that would be end of the day, but you were the expert.
I mean, the most volatility is at the morning open, the market open and the market close. So you know, this was a purchase around 3:00 PM, so if you really divide the day up, if you can be there for the market open, the first hour, 9:30 to 10:30 AM Eastern, and then the last hour, 3 to 4:00 PM Eastern, you'll see the majority of the moves, so this was a classic late day breakout on SFOR, a cup and handle, an intraday breakout, a Friday short squeeze, whatever you wanna call it, but this was people just basically panic buying into the close, 'cause you know, they're afraid to miss out, and again in this bubble market, they're rewarded. I don't mind selling too soon, you know, in the elevens and around 13, you know, maybe this goes to 18, 20, or maybe this is just Friday madness, and then it panics back down to 10, in which case I'll dip buy it. I don't know, I just like locking in safe profits, but I like late day breakouts, and then SF or TSNP, you know, if you can buy the morning panic, I mean, this is the first few minutes and I bought this morning panic on Friday too, in the thirteens, and I sold it too soon, I didn't know it was gonna go to 20, this doesn't look like much on the chart, but this is a 50% spike off the lows, in two-and-a-half hours, so I like dip buying morning penance, and I like buying, you know, ideally late day breakouts, you know, as opposed to morning breakouts, morning breakouts can really spike, or they can fail very quickly. I think THCT is a great educational example of why it's not good to chase morning spikes, this thing went from 7 cents up to 48 cents, in basically 20 minutes, 7 cents to 48 cents. Okay.
This is nearly seven times your money in 20 minutes, and then what did it do? It panicked and it crashed. So E-Trade actually wouldn't even let me trade this one, and I'm thankful, I probably would've tried to dip buy it if I could have, you know, in here in the 21 level, in this first little green candle here at 20, and it came down to 16, I probably would have had a loss, even though it did bounce up to 24, but this is a weak bounce, so morning spikes are scary, this happens sometimes, you know, with penny stocks where you get these big ones morning spikes and then just nothing afterwards, so I would prefer for me personally, you know again, you do what you wanna do, but for me personally, I like dip buying morning panics, and buying afternoon breakouts, those are my two patterns right now, so I just waiting for those patterns. So thank you everyone for asking questions, leave some comments below this video, write into my team if you have questions, again, there is no bad question, you're trying to learn here.
Just do me a favor and study up, 'cause I have so many materials that I've worked on, like I have a "Learn Level 2" DVD, when you say please help me learn how to read level 2, I mean, I have the DVD it's called "Learn Level 2", watch it. I've worked so hard, my team has worked so hard over the years to provide you with so many different materials. Study up, recognize this is a marathon, not a sprint, and you know, focus on only the best patterns that work best for you. I'll see you guys next week.
2020-12-20 18:36
