“Why is the sky blue, I don’t know, I’m sure some scientist knows?”
Overall a very solid chapter, I start with the quote above because I think while funny it is one of the most useful points of this chapter. Sykes used this quote when discussing news around low priced stocks. It came from the fact that he was pushing never anticipate earnings or news or other announcements, trade the reaction to them. So many new traders get stuck on guessing games and lose because of it. If you trade in anticipation of events so often you will get shook out before the trade has a chance to work. And in the end even if you are right you may end up losing. If you are watching this DVD or interested in it you are a TRADER, trade the price action, you are not a GUESSER.
This content alone was worth watching for an hour.
Other than that there is a lot of discussion about time of day and your personal schedule. Sykes like to refer to himself as a “retired” trader. I have a similar mindset in that I call myself a “part time trader”. Him and I both might be strapped into a trading platform 9+ hours a day but we are focusing on ONLY trading the best setups and not trying to trade anything and everything. Obviously I’m biased but I think this is the best approach.
Very good chapter, I like that he wrapped up on a couple hypothetical SSS setups and how the simple spreadsheet can serve as a guide. Very solid watch and really a potential rewatch.
A: At what “time of day”
Don’t become a slave of the markets
First and last hour, best times
Sometimes mid day plays but more often than not, there is nothing or very little
Quit chasing the scraps and wait for the best setup
Overnight trades are solid setups/especially under PDT
Overnights are risky because of potential news etc.
-buying good news O/N is solid setup
-Shorting ugly charts O/N is a solid technique as well
-International news and overall markets can effect overnight postions
Consider your schedule and to do list each day
NEVER feel bad if real life gets in the way of trading.
Wait for trades to come to you instead of constantly “fishing” for plays
Make trading work for your schedule.
Be careful setting profit dollar goals
Think of yourself as a “retired” trader or “part time trader”
-instead of milestones focus on the process and getting consistent
Avoid pre market unless something VERY interesting. Use pre market as a guide
Shorting early sometimes is the only approach, because of share availability, but consider size and squeeze potential
Use chat/twitter etc as “idea generation” never follow, never believe
Prepare pre market, start researching 9AM AT THE LATEST, more like 8AM
Recap of student profits and testimonials
Paper trade if you are new
Don’t be a slave to trading, trading should offer freedom
-News and other catalysts are a guide, but NEVER get to biased.
Good discussion of contracts and earnings and how stocks react to them.
But never guess on earnings, trade afterwards and the reaction
Very good advice on only trading the reaction to news and earnings etc, guessing ahead of time has NO edge
Trade the movement, not the anticipation, never hold and hope.
You don’t need to dig into the news and filings that much, cursory glance and react
Don’t revenge trade, a miss is a miss
Discussion of “buy on rumor, sell on news”
E: Market Environment
3 out of 4 stocks follow the market.
-Dont fight this, follow it
Have zero expectations and you will not be disapointed
Low float runners hot (summer 2016) but at some point they will quit working, but keep trading them until then.
“Who is to stay August won’t be better” 😃
“Why is the sky blue, I don’t know, I’m sure some scientist knows”
Trade what is working “NOW”, right now low float runners, soon it will be something else.
55:35 First SSS example and breakdown
profit.ly/sss simple online spreadsheet to test
Examples and breakdown for 0-100 scale
Criteria stay the same, but what goes into them will change
Some final market commentary, be reactive not predictive
LX21 and Croock videos coming up