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What to do when the market is selling off

The SPY (S&P 500 ETF) is down around 4% in the last week. Mostly due to the newest COVID variant dubbed "Omicron." Keeping politics out of this as much as possible I want to say, the market is down based on the fears of government response to the new variant. 

The economy is already having a tough time due to supply shortages. Of course it's easy to fear that any more supply/production constraints will push us over the edge. 

Whether or not that happens, it's important to keep the market downturns in perspective. Throughout history, periods of fear and panic selling have been the absolute best times to buy in. 

This is true for mid-to-long-term investing, but of course if you are short term investing you need to have a solid stop-loss point and the ability to find strong support/resistance levels. 

Take the first COVID Crash as an example:

In one month, the SPY dropped 35%. If you were holding during that period it was no doubt scary, but 5 months later it...

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Day Trading Beginners Guide in 2020

Uncategorized Sep 25, 2020
 

What is day trading?

Day trading is the act of buying and selling a stock in the same day. Some traders hold for hours, some hold for seconds. This will depend on the specific strategy you are trading.

How much money do I need to start day trading? 

The wonderful SEC has a rule in place called the PDT Rule. The PDT rule states that if your account is less than $25k, you can not execute more than 3 day trades within the same 5 day rolling period. 

Some brokerages located outside the US have found ways around this for US Citizens, but you will not be in the good graces of the SEC. Proceed to brokerages like F1Trade and CMEG at your own risk. It's important to note that the SEC has never prosecuted an individual trader for violating this rule, only the broker services themselves. I traded for years with an account of less than $25k, and never had an issue. It's very common. 

If you would like to stay within the good graces of the SEC and still have less than $25k, you...

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I'm +$750 Since Starting the "One-Share Challenge"

Uncategorized Jul 02, 2020

If you've been following along you know that about a month ago I started what I called the "One-Share Challenge." (OSC)

The OSC was a directive to myself to get back to the strategy, and hone in on my discipline. I found that I was cutting off my winners too early, getting out too early on stops, getting in trades I didn't need to be in (FOMO), and was too scared to get in many of the trades that I had lined out in pre-market. 

I spent 2 weeks only trading one share at a time. It was tough, because I knew I would not make any money on the strategy- but I had to do it. 

After doing this exercise, I was able to get my accuracy from roughly 50%, to 80% and climbing. In addition to doing this, my boredom during the exercise led me to start taking "Halts" on trades, which is where I was able to make good money while trading with only one share on the strategy. 

The biggest thing I learned during this time was patience, and trust in the strategy. I highly recommend trying...

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Results from the "Trader's Mindset" Assessment

Uncategorized Jun 29, 2020

About a month ago, I put out a survey called "Trader's Mindset." If you haven't taken it, I'll link to it in this post. 

I'm happy that almost everyone in the class has completed the survey, and I've been able to see the results. These results will help me better craft the message and help with what most people are having issues with. 

I'll be doing a video series called "Trader's Mindset" very soon, where I will go over each of the questions most students have issues with. 

As you know, I believe very strongly (and the evidence is on my side) that the most important part of trading is psychology. Your Trader's Mindset is what will take you to the next level. 

I took note of the questions that had the most "incorrect" responses. Although as the survey stated, none of them are actually "incorrect," they are what is true for you at the moment. You should not answer with what you think is the right answer, you should answer with how YOU feel about currently about...

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The Answer to Trading

Uncategorized Jun 08, 2020
 

Hey All!

It sounds to good to be true, but I am here to tell you that there is an "answer" to being a profitable trader. 

As always it's going to come down to:

  1. Mindset
  2. Strategy
  3. Implementation

Mindset

  • Risk
  • Patience
  • Discipline

RISK

I can't stress enough how important having the proper mindset it. In the book "Trading in the Zone," Mark Douglas talks about accepting the risk. 

Many of us think that because we've made the choice to become traders, we've "accepted the risk" of trading. Let me stress to you that that is NOT true. You can become a trader, and not accept the risk of trading at the same time. 

Not accepting the risk is the basis of all of the future mistakes you might make. 

  • Getting in too early
  • Getting out too early
  • Not entering a trade

Even though I've been trading for over 5 years, not accepting the risk of a trade is the thing I need to work on the most. 

What am I risking? For me it is not the money. Whether it was through music, through...

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Personality Types, and Your Trading Style

Uncategorized May 28, 2020

I'd like to invite each one of you to take a couple different personality tests. After I was talking to Charlie yesterday about my biggest issue in trading, he laid a big one on me. 

Me: "I have a strategy that is 90% accurate. How is it that I still hesitate to get in trades, and I still take my profits too soon? I don't care about the money. Whatever amount of money I lose in a trade can always be replaced. I just don't want to be wrong." 

Charlie: "That's because you're an Enneagram Type 5. You fear being wrong, and want to have everything figured out."

Why this matters:

As I've said repeatedly, psychology is the most important part of trading. With this in mind, I'd love to see some of your personality types. If we match on types, I might have some even better insight on ways to improve your trading. It's unbelievable to take one of these tests and then see the description of your type describe you perfectly. 

Charlie is care-free, and I am definitely not. That...

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My Plan for Our Class Members

Uncategorized May 26, 2020

Tradings stocks isn't easy. That's something that's hard to grasp for most people because is seems so incredibly easy. In one way, it is simple. You hit a button, and if you hit that button at the right time, you can make money. In fact, it takes no knowledge at all to hit a button and make money. But, can you do it consistently? That's a much bigger question. 

This class is aimed at teaching people who have no prior knowledge in the market. It's good for experienced traders as well, but the first few weeks are definitely designed for those who have never put any time or thought into the stock market. 

We line out a few of our main strategies in this class, but the biggest thing I try to get across is that you need to find the strategy that works for you. Everyone has a different risk tolerance. If you end up taking a trade without knowing "why" or without accepting the risk, you'll mess it up, plain and simple. 

As we go through these lessons, try to perceive the...

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My Biggest Fear As a Trader: Being Wrong

fear May 26, 2020
You’ve heard me say before.. Fear is the enemy of success.
 
When it comes to trading, that couldn’t be any more true..
 
I went through a bit of a transition a couple years ago. I had to take a deep look inside and ask myself some pretty hard questions.
 
When it came to Trading, I wanted to figure out why I’m so likely to hesitate on trade entries, to move my stop-loss, or to take my profits too early.
 
Of course, the answer is simple: fear.
 
But.. fear of what?
 
To be 100% honest, I’ve never been afraid of losing money. I’ve always had the mindset that whatever amount of money I lost, could always be replaced.
 
So what was I afraid of? Being wrong.
 
I realized that I wasn’t trading to make money, I was trading to be right. I was out to prove something, and anytime I lost a trade it was proof that I was “wrong.”
 
No one wants to be wrong. But some people hate being wrong more...
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