A lesson from my biggest trading loss

Friday was an ugly day for the markets after numbers revealed inflation accelerated in May. 

But while a lot of traders whined and moaned about the market crash, there were plenty of runners in penny stock land… 

And the best part is, that the moves were predictable before the market even opened.

But while I liked a lot of tickers on Friday, I didn’t like any of them in the morning…

When markets get spooked, it’s not the time to jump in random trades.

You want to let traders’ emotions play out and the charts set up … You want to see where you have the advantage…

Because if you hunt for a trade for the sake of trading, it can be one of the worst things you can do for your account. I know that from personal experience…

So today, learn from my 15 years of experience and discover what not to do on a day like Friday. And what to do instead… 

Learn how my years of experience can help you daily here! 

What Not to Do on Ugly Market Days

I remember it like it was yesterday… 

It was years ago on a market day much like Friday. 

The sun was shining and I was sitting at my desk looking out the window… 

It was too early to leave for the day but there was nothing going on. So I started jumping through tickers on my screen and there wasn’t much going on there either… 

Then I came across a triple-leveraged ETF that was making moves.

I thought this looks like a good trade. 

Boy, was I wrong… 

I took the biggest loss of my career that day. 

And that’s something you never forget…

So when the markets look like they did on Friday morning, it’s not the time to buy bearish ETFs or any other random ticker that’s making moves. 

What to Do Instead…

When the market makes chaotic moves, penny stocks still offer great opportunities… 

You just have to wait for textbook setups.

In my Friday morning SteadyTrade Team morning webinar, I really liked Redbox Entertainment Inc. (NASDAQ: RDBX) when it was gapping up. 

I told SteadyTrade Team members it was a watch for a short squeeze. 

But I didn’t like it at 9:30 a.m. — or even at 9:45 a.m…

I wanted to watch it for mid-morning to late-day moves. 

And that’s exactly what happened with RDBX, you didn’t have to rush in at the open… 

When it broke through the high of the day, it continued to spike and break out. Learn how to trade breakouts here. 

AeroClean Technologies, Inc. (NASDAQ: AERC) was another afternoon mover on Friday. (It was also on my Friday squeeze watchlist sent right to your inbox.)

It had a VWAP-hold high-of-day break around 1 p.m. Eastern and had a $1 per share move! 

Again, waiting for mid-morning and afternoon moves were the better trades. 

But I know patience can be tough when you’re new… 

You’re excited to trade and start learning the ropes. But the best thing you can do for your trading is to learn how to control your emotions.

Take a lesson from the biggest loss in my career and avoid trading out of boredom. 

FOMO and revenge trading are other common emotions that can trip you up.  

So before you take any trade, think about whether you’re trading based on emotion, or if it’s a trade that can help you get closer to your goals… 

Is there a setup and pattern? What’s your plan and what are the odds for your trade?  

In the SteadyTrade Team, we look for the most obvious setups in the tickers that everyone’s watching. 

Then we want to trade off key levels and other traders’ emotions… 

But you can’t do that if you’re too wrapped up in your own. 

So keep a clear head today… 

If you’ve studied the patterns here, you’ll know a trade when you see it. 

Have a great Money Monday, everyone. See you back here tomorrow.

 

Tim Bohen

Lead Trainer, StocksToTrade