Day 58 of the $583 Challenge +$4,251.87

 

Oh hey, I didn’t see you there. So let’s see, we’ll jump into mid-day market recap. Just shrink this window down a little bit.

All right guys, time for our mid-day market recap. Today is day 58 of the $583 Challenge and I’m up $4,257.38. Now, this puts me now up just, actually just under, right under 110,000 in this account that I started on January 1st with $583. Definitely an impressive run here. As you guys know, I had a little bit of a setback.

I was on, what was the date? On March 10th, I lost 36 hundred or 35 hundred. That was the beginning of a four day red streak. During those four days I lost a total of $15,000. I went from $101,000 down to $87,000. I was building up, building up, and then I had, you know, four days where I was pulling back. Which, obviously wasn’t fun.

During those days you guys can of course, go on YouTube and see the recaps for each of those days. Those were days, let’s see, 46, 47, 48, and 49. Then on day 50, I rebounded with a $2,000 winner. Since day 50, I’ve now made $22,000. That’s $22,000 in 1, 2, 3, 4, 5, 6, 7, 8, 9 days. Averaging a little over 22 hundred dollars a day. This has been a really good example, and it’s really good for you guys to see, of a trader having a setback, falling into a little bit of a rut, reevaluating, kind of making some adjustments and then coming out of that red streak with momentum. And now I’m breaking through, fresh highs, as my account is in [inaudible 00:03:00], it’s never been up before.

This is something that every trader, everyone of you will experience at one point or another, where you have a little bit of a red streak, or you make some mistakes of whatever it is. The problem for a lot of beginner traders, is that it can get you kinda rattled or you start to think, start to get desperate, you start to get emotional. Something we talked about in Class 1 of the Day Trade Course last night, was the challenge as a trader between thinking with your emotional mind and thinking with your intellectual mind.

As a trader, we have to be always thinking with our intellectual mind. We have to be looking at setups and making these analysis risk-reward analysis. If I risk a $1,000, do I have the potential to make $2,000. If I risk $10,000, can I make $20,000. When you start being emotional, when you’re thinking emotionally, and when you’re trading emotionally, that’s when you start to do things like, you get impulsive, you start to chase momentum, you buy stocks that are way too high, and then suddenly, you get yourself on the wrong side of the trade.

Now, your intellectual mind would look at that setup a day later and say, oh, I chased it, but in the moment, you were all emotion. Learning to recognize some of those kind of triggers that can start to get you into that emotional trading cycle is really important. Even for me, there are times where I’ve traded, I mean, obviously for sure there are times where I’ve traded emotionally, but even in the last three months, there are times where I’ve allowed emotions to get the better of me. It’s cost me money.

Becoming aware of it, is probably the first step. Having that mindfulness and that presence of self to say, okay, I’m starting to get emotional right now. I’m starting to get angry. I’m starting to get frustrated. This is a good time for me to step back. A lot of traders have, especially beginner traders, and this was no exception for myself, instead of stepping back, we just get more tunnel vision on kind of, whatever the issue is. On the revenge trade, on chasing, on getting back what you lost. You can get so tunnel visioned that you don’t realize that left and right, you’re losing thousands and thousands of dollars.

I talked to a trader who lost $600,000 in a single day, trading emotionally, with revenge. You know, I used to think, well at a certain point, I’m just gonna lose so much money, that it’ll be like, I’ll finally tell myself I need to straighten up. I don’t think that’s true. I think that you only able to become disciplined by conscientiously taking over control of your mind, in saying, I’m not gonna allow myself trade impulsively, I’m not gonna allow myself to trade in an emotional state of mind.

Becoming aware of your state of mind, anytime you take a trade, is one of the exercises that we talked about last night. We’re gonna continue that discussion tonight, chapter two, Class 2, Risk Management. Last night’s class was three and a half hours long. I’ll be uploading it this afternoon to the website, so you guys can start streaming it. Tonight’s class will be a long one as well. Risk Management is one of the most important topics and you guys need to understand how you can manage your risk.

Trading is risky. Losing $15,000 in four days is not fun. Making back $22,000 in nine days is great, but it doesn’t come without risk. You have to measure that risk against the potential for a profit. My trades today are all really good examples, I think, of risk management. I took a total of, I think it was three trades, the first one was on CBIO. CBIO, even right now, I think is up close to 200 percent. This is a crazy momentum stock. And what we’ve seen in the last few days has been some really big opportunities. We had HTGM last week and early this week. We had APOP yesterday. Today’s CBIO.

Now CBIO was, I would say, fairly obvious pre-market that it was gonna be in play. But like APOP, it was quite extended. I looked at this, and I was thinking, okay, when the bell rings, I will give in at eight dollars. That’s what I was looking at. Pre-market. I had my order ready, 25 hundred shares to get in at eight dollars. I probably would of pressed it twice and had 5,000 shares. But, just before the bell rings, we popped up to 839. This was on the one-minute chart. Just before the bell rings. So now I was like, ahh, if I get it in the 25 hundred shares at eight-fifty, and it drops right back down to eight, down to seven-seventy five, this could be a repeat of what happened on RGSC. Right?

Remember the trade I took where I lost $15,000 in one day earlier this year? I just got totally smoked. I got into a stock, just like this, I chased it. I saw it moving and I thought, you know what, I’ll just buy it higher. It looks strong, I think it’s gonna probably go to nine or 10, I’m just gonna buy it higher. Well, in this case it would’ve worked, in the case of RGSC it didn’t work. The reality is, you never want to put yourself in the position where you can potentially lose $7,500 or $15,000 or whatever it is. You never wanna put yourself into a trade that you don’t have proper risk-reward ratio.

On this trade, I didn’t have a good entry. At 839, when the bell rang, and popped up to nine, at that point, I really didn’t feel like I was able to manage risk. I looked at it spiking up and I was like, well, I need to wait on this one for the first pull-back. If I get in here at 850, I’m buying it to extended, so I need to give it a second to pull-back. All right. Let’s see, I’m just gonna look at my execution window here.

My first trade on this, we pop up to a high on this candle of 962 on the one-minute chart. Then, we pull-back here. I’ll show you guys who are watching on Facebook live. Here’s my daily gains, $4,251, those are the two trades, two stocks I traded. Here’s CBIO. Right in the first two minutes, we spiked up from $8 all the way up to 9.62. Of course, there’s some of you in the room who got in at eight or 8.50 and made a couple thousand dollars before I was even getting in.

I said I’m gonna wait for this candle to close and when this candle closed, I said, my entry will be at 9.50, which is the high of that second green candle. Nine-fifty. My proper stop would be the low of that candle, although, realistically, I’ll probably stop out closer to 9.25, if it doesn’t go right away.

I get in there at 9.50, and what happens next, we spike up to 10.90. That’s a dollar-forty cents, spiked up there to 10.90, then here we are at 10.60 and then this candle we dropped back down. I sold it, took my profit, and it was like, I think it was like $1,100 or $1,400 or something like that. It wasn’t the biggest winner ever, but it wasn’t bad.

Then obviously, I’m kinda like, okay, well, I don’t know if I wanna get in here because we just had that red candle, of course, then it pops up to 11.75. I was like, whelp, it’s obviously showing strength. Pull-back here, but I didn’t really want to get in there again, because I felt like I couldn’t manage risk and it goes up to 12.

This is basically what happened. It just keeps going up without really giving much of a pull-back. Then finally squeezing up to a high of 17.50. I was like, jeez louise. Hindsight being 20/20, I wish that maybe I’d been able to do better on this, but the reality is, I need to be able to manage my risk on every trade I take. If I can’t, I can’t justify the position.

CBIO is just on a tear from $8.00 all the way up to $17.00, which is, I mean it’s crazy. It really is crazy. I could have been more aggressive. I was having a connection issue with my computer this morning. I don’t know if it was my wifi or if it was my connection to my broker, but what was happening was, all of a sudden my level two would freeze.

I had two level two windows, because I have Speed Trader on one computer, and then I had eSignal on the other. My Speed Trader would stop, 100 percent stop, no quotes, nothing. Meanwhile, eSignal is, you know, the quotes are running. I’m like, okay, I’ve lost connection. I’m having some connection issue.

That happened in my trade on CBIO and my first trade. I realized immediately this was gonna be a little bit of an issue, because I was putting out my orders to sell, I never even saw the price go as high as 10.90 on this spike, because when it went that high, I was disconnected. When it came back, it was right here, around 10.30.

I sold around 10, 10.15 and 10.25. I actually made, let’s see, I can tell you right now. I actually made $1,800 on that trade. I was in at 9.50 and I sold at 10.24. Seventy-five cents per share, seven percent gain, not bad.

I got back in this at, let’s see, $15. Let me find where that trade was. I was right around 10 a.m. So 10 a.m. here, we squeeze-up and were halted. Right here you can see we had the halt at … Halt price was 15.23, and I said, if it opens lower, I will add over 15.23. It opened lower, and as it came back up through 15, I was like, okay, this looks good, I’m gonna jump in here, 15.10.

Now, I got in knowing I was having a problem with my connection. As soon as I got in, I told you guys, like, okay, ahh, I can’t see my quotes. I’ve got nothing. I’m looking over at eSignal, and I see my quotes are going there, and so I was like, okay, I can see the price, but I can’t do anything. I can’t sell. I only had 500 shares. I took small size because I knew that this was gonna be a problem.

In at 15.10, I sold it at 16.10. Made a dollar per share, quick dollar per share as it spiked up to a high of 17.50. That brought me from 18 hundred up to $2,222. Overall, I’m happy with the way I traded it. We got a little bit of a pull-back here, and I said, guys watch this level over 16.32, some traders, when that breaks, are gonna get back in it. Interestingly we kinda curled back up and finally we squeezed-up in these two candles over 16.

But it was a little choppy, because this was the candle that broke, and it was a false break. Pulled-back, didn’t work, consolidating, but the price held above the 20 moving average on the one-minute chart.

On the five-minute, we were still very extended, during this five-minute pull-back. The first five-minute candle would make a new high as a result, was not a very solid break-out. Notice the declining volume on the five-minute chart. You don’t want to see declining volume. You wanna see volume increasing during … Whelp, it’s okay if it’s declining during consolidation, but on the break-out you want to see the volume to be higher than the first move. That’s when you know the stock is still running. When that’s not the case, then obviously it’s a problem.

In any case … High a day on this was 18.88. I didn’t capture as much profit on it as I could of. I could of been a lot more aggressive trading the one-minute set-ups and trying to scalp, you know, get in, get out, get in, get out. You can see after each one of these red candles, I could’ve gotten in here, I could’ve gotten in right here, and I could have gotten, in this area here.

Obviously I would’ve done a little bit better if I had been more aggressive. I know John made about five, six thousand dollars on this trade today and it put him up over $100,000 on the year, which is really great. I’m really happy to see him doing so well.

Certainly there are traders in the room that did better on this one than me. I took the two trades, that I just pointed out, were both low risk trades. The higher risk one certainly was after the halt, but it made sense, that’s a good set-up. This trade here, the first one-minute candle to make a new high was a good set-up. I feel good about those trades, they were relatively low-risk with good reward potential and I would take them time and time again.

Now, as CBIO is running, all of a sudden IMUC popped up on the scanner. When I saw that one, immediately, I was like, okay, it’s got a good daily chart, it has a history of making some moves. What we’ve seen in the last couple of days have been sympathy moves. We see the primary stock making the big move, and then the sympathy stock that starts to take off. I think we had, let’s see, we had GBR yesterday.

The day before that, we had, I think it was ZAIS. The day before that, we had, I think it was XLMA. We kinda see a primary stock with momentum and then the next one that starts to go, has often been getting really good follow-through.

This one, for whatever reason, did not follow-through as well as I would’ve liked. I got in it as I saw it starting to spike up with an average of 3.32. So 3.32 is my average, which is right up here. We popped up to a high of 3.60 and right here, I said, okay, I wanna see the first one-minute candle make a new high and we gotta break over 3.60. What interestingly happened on this one is, we popped up, we doubled topped at 3.60, there was a heavy seller at 3.60, and we couldn’t break that level, then we came back down.

I marketed out of this thing getting filled at in the 50s, but my average was like 40, 45 or something like that. Not the best follow-through, but I was aggressive, got in, was looking for the bigger move. We had about 30 cents of total profit from my entry at 3.30, but we couldn’t hold those levels. That one pulled-back and then has been, now actually, kinda making the move back up into the 30s. We’ll see, this one might be one to watch tomorrow for continuation. I’m not totally sure.

In any case, right now we seem to be in a market with a lot of opportunities. We’re seeing some really strong momentum. This is also a market where you can kind of get away with breaking rules. Like, if you had chased CBIO today, you probably would have done just fine on it. But you do that another day, and you’re gonna get smoked. You wanna make sure you don’t fall into the routine of kinda breaking rules or being sloppy.

Maintain your discipline, it’ll carry you through the inevitable slope periods that we have. When we have a hot kind of trading window that we seem to have right now, it’s a good time to be aggressive, try to capitalize on it as much as possible. Know that those profits will have to tide you through some of those slow periods that will come.

I’m glad after that $15,000 draw-down, that I’ve been able to go back on this green streak. Ultimately, I would want to get to at least $30,000 before my next kind of cold streak, so that, that way my green streak is twice as big as my red streak. So down 15, and then recovering that 15 and making another 15. If I come down 15, I recover that 15, go up another 15. That’s continuing to move up in increments that I can feel pretty good about.

That’s kinda where we’re at today. End of day 58 and hopefully we’ll continue to see some good opportunities. I see no reason why we won’t. It’s been really pretty impressive. This is a great way to finish up the month. I’m now at 34, just under $34,000 on the month.

We’ll see if I can maybe get over $40,000. That would be nice. We would need two more, at least two more really good days, three more really good days, probably to do it. We have four more days in the month. We’ll see what we can do. I’ll try to be aggressive and really have a great week here. I’m up right now about $9,000 on the week.

All right, so, that’s it for today. I will upload this to YouTube and anyone with questions or comments, you can put them in the YouTube comment section and I’ll make sure I answer them. Right, sorry, three more days in the month. I didn’t write down the gains for today. So, day 58, plus 42, 51. Three more days, if I can average $2,000 today, $2,500 a day, that will get me up over $40,000. If I have a red day, it might be a little setback. We’ll just see what we can do.

All right guys. That’s it for now, and I will see you all first thing tomorrow morning.

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