I Was Red -$12k Before My Big Winner... transcript

What's up, everyone? All right, well, here we are. It's Monday morning and the roller coaster was open today. Friday took the big dip down $64,000. Today, I continued it. I went down another 12,000 before I rallied up from red 12,000 to green $62,000 [music] in one big trade. Holy smokes. And then a little pullback off the top. And as I finish today, I'm sitting in the green. Boom, there it is. $52,920.96. Trading two stocks, IPST and WETO.

Although, really only dipped my toe in the water on WETO and then kind of said, "You know what? Let's kind of knock that off. I think it's a little too risky." Uh ended up continuing moving a lot higher, so had the right idea on it. But, after giving back profit after the open on Friday, I sort of caught myself before I kept trading and and called it. So, let's talk about IPST because this one sent me red 12,000 before I got the recovery.

IPST is currently our leading gainer and I already talked about it during the small account challenge recap, but I think the uh the difference here, of course, is that in the small account, uh I got three trades on it. They were all with relatively small size because of the account size. And they were three winners. I was able to get in, get out. Get in, get out. Get in, get out. However, in the big account, if you're trading with big size, and as you've seen I have been, and you have days where you're making 20, 30, 40,000 dollars, or you're losing 20, 30, 40,000 dollars, ultimately, you're not going to have those big uh P&Ls by just taking 5, 10 cents off the table with smaller size.

You need to take bigger size. And so, I kind of came in today knowing that uh obviously, I was in a drawdown, and I needed a couple of good trades to put a decent dent into it. Not not to make it back all in one day, but just to have a good trade doing it with, you know, 5 or 6,000 or 10,000 shares probably wasn't going to cut it. And since we had a stock this morning that was already up over 200% early, this one squeezed this morning about 4:00 in the morning from, let's see, 215 to 298% from a low of about $3 a share up to $8.

It then pulled back closer to the open as we saw here, and we had the formation of this inverted head and shoulders pattern, right? So, here's the shoulder, the head, the shoulder, and we broke right here. Well, I took my first trade on it right here. And I was really confident it was going to work in that spot. Why was I so confident? Well, we'd had a couple other stocks that popped up and failed, but this one was still holding relatively well.

It had broken over VWAP right here, and I did not trade any of this big move because at that time, right around 7:00 a.m., I just wasn't sure it was going to work. It's not a It's not a Chinese stock. It's a US company. It has a shelf registration. So, I kind of thought maybe this is one of those stocks that has a big pop and then just sort of unwinds the rest of the day, and any pops here on the backside get faded. But, as it regained the volume weight average price, I got interested.

It ends up going up to a high right here of about 6 85. It dips down. First 1-minute candle or 5-minute candle makes a new high. I didn't fall for that trap. I knew it was still too extended off its moving averages. So, it drops back down to the nine, comes back up to VWAP at about 6:20. It drops down a second time, and when it came back up to 6:20 right here, I was like, "Okay, I'm going to punch it." I put in my order size for 15,000 shares, and I started pressing the buy button.

Boom, boom, boom, boom. I'm adding into the squeeze. I'm looking for the break through descending resistance right here, the break then through 6:85, the squeeze through seven, and immediate push right up to eight. I was looking for what we got right here, but I was expecting it right here. And I was wrong. And so I jumped in and it immediately dropped back down and I sold for a $12,000 loss. And so now I'm red on the day 12 grand and I'm thinking all right, well, this is not good.

It's a continuation of the loss from Friday to go deeper in the red. Um so I'm just going to have to sit on the sidelines. So while I'm sitting on the sidelines, we have US UF USC uh I think it was you know what was the ticker? Um UCF that's what I typed UFC maybe maybe it was well, what the heck was that ticker? Um I'll have to go back on the scanner to find it. And was it not it must have sold off a bit. All right, so we're just going to scroll back to find it.

So we had the stock that pops up. It's sort of a similar price range where we've seen some big moves um in the last week. I think a lot of traders were hoping this one was going to do one of those um squeezes where it went straight to like four or five dollars a share, but it wasn't able to do it. Where was this Oh, here it is. Um US UCL. All right, so UCL. UCL ends up making this move here and I think traders wanted to see a move like SAKET S C T S C K T where it would go from holding a dollar straight up to like four dollars a share.

But I looked at it and I recognized pretty quickly that was not likely. Um UCL was just too heavy. It just was not happening. So once that rolled over, then attention sort of shifted back to IPST. And we'll talk about W T O in a minute. It's currently uh continuing to be strong up 159%. But um so on IPST when this thing um sort of pulls back down below VWAP, it's pulling back. It comes back up here and then we reject right here.

And then it comes back up again and right here as we broke over this level right around 640 uh 650 is where I started adding to anticipate the break through here, the break through this level, and then the break of seven certainly, and then looking to add for a squeeze up to eight. And if I'm going to be honest, I was expecting a much bigger move than this. The reason I was expecting a bigger move was because I really thought that it was number one leading gainer, and so once it broke back through the high of day, that shorts would cover and that we would see a big push higher.

The fact that we didn't makes me wonder if it's possible that the company is tapping their shelf registration to sell more shares on the market. I don't know, but it was it was a little heavier than I thought. In any case, on that trade, I did the same thing. I punched it 640 and I'm adding as it squeezing higher. So, adding, adding, adding, taking a big position. We get this push all the way up to eight, taking some profit off the table.

It dips down, I add some back for the squeeze through the high, take some profit off the table. It pulls back, I add back right up here, and that's where I gave back about um $10,000 off the top. So, I gave back some profit off the top right there, which was a little disappointing, but I could tolerate that. It's um you know, it's not a big deal. Big big picture, I'm sitting in a really good spot on the day, and this is a similar setup where I expected it squeeze through the high that we would push higher.

We would break through nine, 950, 10, and keep, you know, squeezing higher, but we didn't. So, then look at WETO at the open. This one gives us that move. It breaks the high, and the high was from the other day. So, it breaks the high and it doesn't just give us a little topping tail and then reject, it keeps going. So, I got in here right in this area. It tops out there, it then pulls back, and then it keeps going. It pulls back and does that nice ABCD pattern, has now gone from 15 all the way to $21 a share.

And you know what? This one, for the most part, went without me. I had a trade early on, I was dialed in on it. I was like, this could work. And then I said, you know what? Listen. You're up $52,000 today. Let's not screw up a good thing. You made back the majority of what you lost on Friday, which is phenomenal. And if you size up on a trade like this with 10, 15, 20,000 shares, and you catch one of these drops, right?

So, what was the peak on this little false breakout? 16. And how much did it drop? It dropped from 16 back down to $14. That could be a $30,000 loss. How stupid would you feel if you turn a $60,000 day and you cut it in half, or more than half? And so I said, you know what? Just stop. And I know it's hard to watch these things go without you, but just stop because the downside risk of giving back profit and, you know, whatever is not worth it.

And I'm still technically I'm still in a drawdown. I was red $64,000 on Friday. I'm up 52 today, so I'm still down 14,000, not including commissions for the last 2 days. I've still got some, you know, work to do to get myself back into the green, or back back to the high relative of my peak for the month. So, get in, get green, get out. Now, I I will admit that I did not follow the philosophy of break the ice with small size.

I instead followed a philosophy I don't have a good name for it, but the philosophy was wait, wait, wait, and then swing really hard. Um and I do take that approach from time to time. Um especially in a market where I'm quite confident that we are going to see good moves, this kind of drop is is tough. Peak of 24, drop back down to 20. It's a four-point swing. Um so yeah, maybe one of you guys can in the comments can think of a good analogy or a good phrase for that um that strategy.

But it's it's kind of like it's a little bit more sniper, you know, you've only got so much ammo, which is not really true. I mean, I could take as many trades as I want, but it's being very selective and just waiting and waiting and waiting and then just striking. Um what's the what's the animal that does that? Uh that's like really patient and then just, you know, attacks. I don't know. Think of that animal and that's what that setup is called.

Uh but it's got to be a cool animal. Don't come back to me with like, you know, a stupid crab or a lobster or something. I don't want to be a that's not a lobster a strategy. Cool. So, think of a cool animal and then maybe I'll start using it. Uh but in any case, uh that was kind of the approach and that approach generally does work well um when I'm also in trader rehab with the big difference that if I'm truly in trader rehab, I have to moderate myself by not taking a big position uh as much as I might want to.

I didn't put myself into trader rehab yes uh from yesterday's loss or Friday's loss and I didn't last week either. I felt that both of those losses were more of a symptom of of my emotion and not an underlying issue in the market. Now, on the other hand, if I'm going to continue to trade emotionally and continue to be really um you know, reckless with how I'm managing risk, then that several losses I could incur back-to-back and then I would have to go into trader rehab.

Uh but because I'm generally right now right more often than I'm wrong, it tells me that the market is still favorable for my strategy. I am making some mistakes, but I'm generally moving in the right direction. I do need to get better at tightening up and walking away sooner on the red days. And so, that's something that I have to really exercise. But yeah, I was able to exercise it to a certain degree today by walking away without overstaying my welcome on W E T O.

Um which, you know, if I jumped in that, let's just say I jumped in that would be crazy, but for a dip and rip at 22, for squeeze into 24, and then from 24 it's going to go up to 30 and then 35 and 50 and all of a sudden I'm holding 10,000 shares down $4 a share. I'm right at 40 grand. And what's it showing on the resumption? 1850. It's going to open another dollar a share lower. Down 50 grand. My whole day is ruined.

I It's just So, you know, I'm trying to remind myself that we are seeing enough good opportunities each day that if I'm patient and then just, you know, take one really good trade, that could be more than enough. And probably, I mean, again, you could argue just take 10 medium trades uh versus one big trade. Because if you take that one big trade and luck of the draw, like my first trade on um IPST, you're wrong, uh you know, you might still have 80% accuracy, but if you blow out and hit max loss in your first trade, then you'll never get those, you know, six or seven more trades.

And I think that that is a fair point. I think I took a bit too much risk on that first trade today. I really thought it was going to go there, and it uh and it didn't. Uh but then I said, "Well, all right, I guess it's over." And it didn't die. And so then when it tried again, I was like, actually had even more conviction that it was going to work. I took even a bigger position because I just felt like, all right, now this is really um doing what I thought it what would do.

So, right idea, wrong timing. Anyways, kind of a lot of thoughts um here on this recap, but I hope you find it um helpful. As always, I'll remind you that trading is risky. Easy come, easy go, as you've seen in my trading for the past 10 days. Big roller coaster ups and downs, but I'm kind of on my rally back up and uh going to try to make this a great week. So, as always, please manage your risk by practicing a simulator before you put real money on the line.

My results are not typical, and there's no guarantee you'll find success, whether you trade with me or you learn on your own. So, please practice in a simulator before you ever put real money on the line.