I Want to Improve My Trading Over The Next 4 Weeks…Here’s How I’d Do It transcript

What's up everyone? All right, so in today's episode, I'm going to teach a class based on a question that was recently asked of me. I had a student who came to me and said, "Ross, I want to improve my trading over the next four weeks. What what are the top things that you think I should focus on?" And I thought about that a little bit. Uh it just happens to be that we're getting ready for the new month. And so it was sort of like, all right, I'm coming to the end of the month and now I'm getting ready to reset.

So what can I commit myself to focus on over the next month? But I think that traders uh have this feeling at a lot of different times throughout the year that you know you have a loss or you feel frustrated, you're not happy with your performance and it's like okay, what can I do here over the next few weeks? What what are the top three things that I could focus on that could actually move the needle in improving my trading?

And I'm going to share with you honestly what I really think is going to make the biggest difference. Not all of you guys are going to like what I'm going to share, but it's what you need to hear. All right? Might not be what you want to hear, but it's what you need to hear. So, let's go ahead and jump onto the screen share. I want to improve my trading. This is how it's done. For those of you guys tuning in for the first time, I'll introduce myself briefly.

My name is Ross Cameron. I am a full-time trader. I funded my first account in 2001. And the strategy that I trade is all about momentum trading. So everything I share with you is really based on the insights I've learned over all of my years of trading and all my years uh at Warrior Trading, teaching beginner traders the strategy that I still trade even to this day. So the first thing that I would ask you if you came to me with the same question of I need to improve my trading and I want to do it over the next few weeks, I would say, well let's set the stage.

I need some context here. What are we working with? how bad is the situation? Just like a medic getting out there in the field and assessing uh your patient, you know, I I have to assess the situation. So, what I want to know is what is your current level of accuracy? What is your current profit loss ratio? And what are your total gains or losses? This is your baseline. How much you making or losing? What are your strengths and what are your weaknesses?

And have you proven that you can produce profits? Even if you're not consistently producing profits on, you know, every single week or every single month, have you had periods where you have made some money? This is helpful. This is a good starting point. If you haven't, then that's also really helpful information for me. So the first thing that I'll say is that if you're in a place right now where you do not have good accuracy, you do not have a good profit to loss ratio and where you are currently sitting with total losses, not total gains, that speaks to me for the need to further develop the strategy that you're going to be trading.

Now what I do for myself is I import all of my metrics to this software right here. I have no affiliate relationship with them. So if you want to use someone else, use someone else. But the nice thing here is you can go and you can import your trades from, you know, dozens and dozens of different platforms. And when you do that, you can go to the reports view here and you can now see all the details behind your trading history.

And this is really important because you can now data mine all of these trades to understand patterns in your performance. This could shed light on something you could lean into that's a strength that you may have overlooked or potentially a weakness that you haven't really recognized um is so prominent in your trading. So for me, for instance, when I have all these trades imported, uh you can see my accuracy over the last 10 years is about 68.5%.

My average winners are $1,500. My average losers are $1,400. and I've got $21 million in trading profits. That's pretty crazy. Now, the thing that some of you might be surprised at is that if we looked at my average winners, my average winners actually are not that big. In fact, right now they're only about 15 cents per share. Now, if you haven't already watched one of my fulllength classes on how to start day trading where I walk you through the ins and outs of my strategy, I'll put a link to that at the end of today's episode because that's what I would use as your starting point if you're looking for a strategy to begin implementing today.

My focus is a small account growth strategy where I'm trading momentum stocks typically that have breaking news between 7 a.m. and 10:00 a.m. Eastern Standard Time. I risk 10% in order to make 10% 1:1 profit to loss ratio. Target accuracy 75% even if I come in a little shy of that that's okay. And target growth for a small account challenge for me is to grow my account by 25% per week. I focus on only trading stocks that meet all five pillars of stock selection right here.

Meaning they are uh really an Aquality setup. And these five pillars essentially search for stocks that have a high likelihood of experiencing an imbalance between supply and demand. And then once I found that type of stock, I trade this specific pattern. That's one of my favorite patterns to trade. So if you're at a place right now where your accuracy is struggling, your profit loss ratio is struggling, and you have total losses, that to me speaks to the need to become a master of one strategy. just focus on mastering one.

This becomes your bread and butter while developing more advanced strategies and setups later on. My strategy for high accuracy is focusing on 15 to 20 cent base hit winners on momentum stocks. These base hits give me about 72% accuracy versus a home run trader who's going to end up having far lower accuracy. So I share this with you at the beginning of this class because I think for some of you watching you may be thinking I want to improve my trading.

In other words, I want to start making money or I want to stop losing money. And that's the the the problem with that is there's a there's a huge gap between I'm losing money and I want to be making money. I mean, it's like, okay, this is wonderful. I it's great to have this goal, but having that goal alone and saying I want to make money next month, that doesn't clearly outline the very specific steps that you need to take in order to move in that direction.

So if we start breaking these down step by step, the first step is adopting a strategy, right? Okay. So, you need a strategy number one. And number two, you have to prove that you can be consistent trading that strategy. So, some of you may have already adopted a strategy. You may be kind of, you know, testing out my strategy or or another strategy, whatever the case may be, but you haven't yet proved consistency with it.

But that's okay. So, I'm also going to share with you in today's episode the steps I would take to work on this consistency. But if you haven't already adapted a strategy or adopted a strategy, then that's your first step. All right? So depending on where you're at, just be aware that it's critical to become a master of one strategy in the market. And that was for me my turning point. Someone asked me, you know, Ross, what were you trading ju just before your turning point?

And I said, well, just before my turning point, I, you know, I I had this sort of long extended learning curve where I initially, you know, from day one ended up making a little bit of money and then I ended up giving it back. This was, this was actually year one. From day one, I was doing well and then year two, I was losing. And going into year three, I continued to lose until I kind of hit this rock bottom period and I started to turn things around.

And when I started to turn things around, it wasn't like things all of a sudden um you know just start going straight up. What ended up happening is I started to make a little bit of progress and I give it back and I make a little bit of progress and I give it back. A little bit of progress and I give it back. So I had this long period of being more or less break even. And in this period right here, what was I doing that was working?

I was focusing on trading news. I was focusing on breaking news catalyst. However, I was focusing on price range of any any price range float uh or market cap any. So, I was trading high price stocks. I was trading low price stocks. I was trading the S&P 500. Anything that essentially had news, I was trading. So, I was I was in the right direction with looking for news catalyst because news catalysts create volatility.

But what I needed to analyze in my metrics was what was happening on these days right here, right? Because if I could take out all of those days, then my account instead would have just been building, right? And so what I discovered was that most of these losses were coming from trading higherriced stocks and most of them were uh also large cap stocks. And so that's what got me focused on adding this new criteria of price between two and 20.

Now by implementing uh the price between 2 and 20 I did naturally end up trading less. There were fewer trades but these were the trades that I was already showing that I was trading better and do had higher accuracy on and so when I cut out the other stuff my accuracy improved in total. Now one thing that I would say to beginner traders is to lower your expectations. So I want you to think about two different traders.

One trader is up $100,000 on the year and they are miserable. Their goal was 500 grand. Another trader is up $100,000 on the year and is thrilled. Their goal was 50 grand. Same amount of money, different perspective. One is quote failing, the other is quote successful, but in fact they've made the exact same amount of money. And so I would encourage you to redefine what success means to you because adjusting your perspective can be a gamecher.

In other words, yes, we all have internal benchmarks that we set for ourselves in order to justify the time you spend learning how to trade, getting up early, sitting down here every day. You might think making $25,000 a year is just simply not worth it. And here's what I would caution against. Imagine in your first year, you sat down every single day. You even traded in a simulator. So you made for six months nothing, nothing in terms of real money.

But then at the second half of the year, you started trading with real money, but you're trading with just a hundred shares. You're making 15 $20 a day. So by the end of the year, you're up $8,000. It's probably not enough to justify a full year of time. you would have made more doing anything else. But what if you looked at this as this is setting my foundation? Because if I can make $20 a day with 100 shares, what if I increase my share size to a,000 shares?

All of a sudden, I'm making 200 a day. What if I increase my share size to 5,000 shares? Now I'm making $1,000 a day. That's $250,000 a year, right? So this is the scalability of trading. And it's not perfectly linear. There is some curve as you scale up. Loss of efficiency, a little bit of slippage on your orders, things like that. But there's no question that if you're consistently making money with a 100 shares, there's a lot of room to scale up your trading.

And so it's easy for a trader to be dismissive of the fact that they're only making $25,000 a year. They're only making $50,000 a year when in fact that trader is laying a foundation that they could build from. But they'd be much better set to build on that foundation if they looked at the success that they've already had with a degree of appreciation. You know that they were looking at that $25,000 as an achievement, not as an embarrassment or as a failure.

When you change your perspective, all of a sudden now you look at the success you've had and you're grateful for it. And that gives you the sort of emotional strength and confidence to dig deeper, to keep trading and to be, you know, e even more committed to following your rules. Whereas a trader who feels like they're constantly, you know, a a day late and a dollar short is going to start to trade from a place not of abundance, but of desperation and scarcity.

So now they're grasping at straws. I really wanted to make 500k on the year. So now in this last, you know, couple weeks of the year, whatever the case may be, they start taking obscene levels of risk to try to get, you know, closer to that goal because anything less than that goal is failure. Redefine what success means to you. Profits are a byproduct of a system. Is it possible for you to focus entirely on the process instead of the desired outcome?

And so if we jump back here onto the whiteboard, step one is adopting a strategy. Step two is proving consistency in that strategy. And we're going to talk about some of the um subtips for improving consistency here as we continue on into the class. There's no doubt about that. But number three, focus on process, not profits. The problem with focusing on the profits is it becomes like a mirage. You're constantly chasing the profit and you sacrifice the focus on the process.

It's just the same as saying, "Next month I want to make $50,000, but without laying out what's the actual system and process that you're going to follow to achieve that result." So, of course, yes, results are are helpful. You want to have some benchmarks, but you can see in this conversation that we're having these benchmarks when set too aggressively can actually be detrimental to your ability to grow as a trader.

That's very interesting to me and I've seen it in so many traders over the years. So, one of the things that I want to encourage you to do right now is an honest assessment both internally and externally. We're gonna do this high level, but it's also something we're going to do every single day when we sit down to trade. So, right now, your internal assessment is an assessment of the strategy that you're currently trading.

So, that's when you're looking at your actual profit loss ratio. You're looking at your accuracy, and you're asking yourself and looking at how much you've made and loss, and you're asking yourself what what here is working. So, for me, and I'll just give you an example of a month here that I thought was kind of interesting. So, this was um I'll just switch this here. So, this was um this was a while back, but I had this month where I underperformed my um well, you know, you could say my my goal that I had set for myself.

I was kind of frustrated. And so, at the end of the month, I looked at my metrics and there were a couple things I wanted to look at. Uh number one, I wanted to look at my performance by price. And I noticed on this month that I was really uh underperforming on my trades on stocks above $10, but I was doing quite well between two and five or two and 10. And I also noticed that I was underperforming when I was trading earlier and underperforming when I was trading later.

And so based on this data, I was able to make a pretty, you know, concrete determination that for the next month, I should focus in on these hours here and stop trading early and stop trading later and I should double down on trading in this price range. It it's not only that I should stop doing this, it's that I should focus on this even more. And so the result was I made 100% more in the following month. I doubled my profit in the following month because I not only eliminated these unnecessary losses, but I was able to increase and extract more profit from the window where I was doing well.

So, an honest assessment allows you to understand your current strengths and weaknesses. So, the internal assessment here and we'll just jump back onto the whiteboard. So, we're going to start with the internal. And the things that I'm curious about is your current um strength and weakness when it comes to strategy. This is very specific to the strategy. So, what are your current strengths? You should list them out. And what are your current weaknesses?

And you should list them out. And is this are there insights here that you can draw that will tell you actionable steps that you could implement in the next three to four weeks based on my current weaknesses. I should for instance avoid you know price XYZ time XYZ right or um you know it could be large capsu caps whatever the case is but use your data to help you draw those determinations. They shouldn't be based just on opinion.

It should be based on some concrete data. And then what are the strengths? where areas that you could double down, right, and be more aggressive. So that's number one. And then number two, uh well, this is sort of in large part number one. And then number two is your aptitude. Now, I think with this here, what I'm thinking about when I say aptitude is that everyone comes to the table to trade in the market with a different set of um of of skills and experience that you're bringing with you.

And I think some people have skills and experiences that naturally lend themselves very well to the style of trading that I use, which is fastm moving breaking news momentum trading. But you may find that your aptitudes don't lend themselves as well to this strategy. In which case, you've got two choices. You either try to build up your skill set so you can trade the strategy or you say I need to adapt this strategy to to accommodate where I'm coming to the table, you know, at with in terms of skills.

So that has to be a decision that you make yourself based on whether you feel that you can learn the things you need to learn or you feel it's better to adapt the strategy. So the the types of skills that I think are really critical here include um computer skills, um typing, fast, um fast response, uh and reaction time, hand eye coordination. Um, this also requires a a a pretty high level of emotional uh awareness, situational awareness, an ability to ident the the writing here, an ability to identify um when you're becoming emotionally hijacked in order in or an ability to identify the emotions that other traders collectively are experiencing and how those emotions are um being reflected in the actual charts of these stocks. you know, when you see a chart for instance, um, of a stock that's done something, you know, just unbelievable.

I'll just show you an example here. Um, so this stock, for instance, switch to like the hour chart. Um, this one made this just insane move from about $60 a share here to $480, but the the couple days earlier it was down to like $15. So 15 1015 to 60 by itself was huge and then it just exploded and went higher. There was a lot of emotion behind this move. There was fear, there was greed, there was exuberance and there were traders that made a lot of money and there were traders who lost a lot of money.

And so that's a stock that was exemplifying a lot of emotion in the market. When there's a lot of emotion in the market, there's also more opportunity because there's more volatility. So an ability to identify your own emotion at on any given day and also the emotion in the market uh is really key. So these are some of the internal aptitudes. Now you also have um your budget right and your account size. So account which is to say account size you know how much how well funded are you?

Number four your tech you know what platform are you using? What broker are you using? what kind of trading tools, what's your internet speed? So, these are all of your internal assessments and and there's probably more on here that we could list, but just to sort of summarize it um high level. So, you've got to do an internal assessment and this is you as a trader today. How well equipped are you to compete in the market?

And some of you are going to be very well equipped and you're still struggling. Others are not as well equipped and you may even be doing well for reasons that we're going to elaborate on as we continue through this class. So first you do your internal assessment and then we do the external assessment. Okay. So what is the external assessment look like? So external assessment is where I'm looking at things that I have absolutely no control over but certainly affect my ability to be a successful trader.

And so the biggest one here is condition um of the market, right? So we know that the market is is cyclical, right? And we have hot cycles, we have cold cycles. And so what cycle are we in? If we're in a hot cycle, then there's an opportunity to extract a lot more profit from the heightened volatility. If we're in a colder cycle with more compressed ranges, there's not going to be as much volatility. There's not going to be as much opportunity to make money.

And there's nothing we can do about that. It is 100% out of our control. And yet, if you came in every single day saying, "I want to make $50,000 today or this week or this month or whatever you said, there's a big number." But the markets, the external factors that the market is not giving those opportunities, it doesn't matter how badly you want it, it's not going to happen. If you keep stretching for it, if you keep trying to get it, you're only going to end up losing and getting incredibly frustrated.

So the condition of the market is the biggest external factor. Number two is um you know we we have things like um you know intermittent intermittent um like tech issues. You know there could be um data issues, a data outage. There could be a widespread internet outage. Uh there could be a big storm and it's affecting data centers, things like that. there's nothing you could do about it and the market could overall be strong but we're having you know some tech issue and this is just the reality of you know a digital very digital market that these things will happen and when they happen you just sort of have to recognize well there's nothing I could do about it doesn't matter that I was hoping to have a great day today I just got to hunker down and wait it out right there's a hurricane and uh everyone's on generators and there's lighter there's lighter volatility in the market um and volume number Three, um I suppose certainly things like market um market holidays.

Um and number four, um at least for small caps, small cap, um cycles, although I suppose that ties in a bit with the condition of the overall market, more generally speaking, you could generally have a really strong market, but the small cap cycle is not aligned with that right now. So there could be a little bit of a divergence there. Um the small cap cycle is really specifically thinking about what's the theme that is giving us the biggest moves in the small cap market because that's where most of um retail traders end up focusing.

Um I suppose to some degree, you know, crypto um has has some effect. When the crypto markets are really strong, that seems to roll over into the stock market a bit. When they're really weak, that seems to pull down the market a little bit. So there's a few other external um factors. So high level, you could be someone who's really well situated with all your internal um uh sort of uh skills, aptitudes and and elements, but externally the market's really weak and there's nothing you can do about it.

This was actually the case, I would say, for me in a lot of ways during 2022 and 2023. I was in good shape internally. I I felt but we were in a bare market that the Federal Reserve essentially, you know, created by increasing the interest rates to cool down inflation. So that reduced volume, it reduced volatility and there was less opportunity. And there was nothing I could do about that. I just had to trade through it.

Well, I suppose I say there's nothing that I could do about it. But in fact, that's not totally true. what I could control was how I responded to the external factors that I'm that I can't control. So, I could respond by either accepting my lack of control and adjusting my strategy to accommodate the changes that are happening in the overall market. Or I could choose to be stubborn and keep trading aggressively every single day in spite of all the writing on the wall telling me I shouldn't.

And most likely the result is that I would lose money and I wouldn't do very well. So that is that is the extent that I have control I have control over how I respond to these external factors. So while we should do this on a sort of on on a grand scale in terms of my internal um capacities as a trader and the external market limits right now I also do it on more of a um kind of micro scale each morning. So, what does it look like each morning when I do this honest assessment?

Internal, did I eat well? Did I sleep well? And do I have a couple stocks on watch that I like today for my strategy? That's internal, right? External, what's the condition of the overall market is the market, has it been giving really good opportunities over the last several days or several weeks? Are we in a hot market or are we in a cold market? And then based on that assessment of internal and external strengths and weaknesses on each day, I can adapt my risk tolerance.

So the question is, is this really a day when I should be aggressive? You've got to be honest with yourself here. The truth will be revealed after the fact, but can we predict it now? In other words, what if you knew that today was going to be a red day? What would you do? If you knew with 100% certainty that today would be a red day, you would not trade. That's what any logical person would conclude. If it's going to be a red day, I will not trade.

Fair enough. If it's going to be a green day, I'm going to be very aggressive. So the fact is we really can't know ahead of time. But surely there is a point in the day where it becomes obvious that it will be a red day or it will be a green day. And now it's a question of how big of a green day it'll be or how big of a red day it'll be, right? And so that's where we really need to be paying attention. By doing the honest assessment each morning, we can sort of take the temperature of the market early on.

Is the market hotter? Is it colder? Right? Does this feel like the type of market where things are working well? And internally, am I in a good position to be trading today at peak performance? And if I am, then I should be really aggressive. Or if or if the market's not set up and not giving good opportunities, then I've got to be more conservative. So one of the techniques that I would encourage you guys uh to utilize certainly we want to adopt a strategy want to prove consistency we want to focus on a process and one of the techniques that I really like using is um is taking the temperature.

So, taking the temp of the market. Um, and I guess I would say, let me just add, let me just do number four, honest assessment. And then number five, taking the temp. This is a daily sort of daily uh routine. I take the temperature of the market. And how do I do that? I do that with my first trade being a starter. And so for me right now, max position, I mean, it kind of depends on the dollar amount, but let's just say for right now, uh, the the the price of the stock, but let's just say for right now, it's 50,000 shares.

So 50,000 shares, max position. So on my starter, what I want to do is I want to trade with about a quarter or a fifth of that position. So I'll take a starter of 10,000 shares. On my first trade, I find a $3 stock. My stop is 290. So I'm risking a,000 bucks. My profit target is 320. right? 15 to 20. It goes up to 315. So, I end up taking the profit off the table and I'm up $1,500. So, now on my first trade, I've broken the ice with a starter.

I've built a little bit of a cushion on the day. Now, had I gone red, I'd be down a,000 bucks, a loss that while disappointing, is very tolerable. And would I increase my share size on trade number two? And the answer is no. I don't increase my share size until I first crossed over about $1,000 of profit. Now, my daily goal right now is $5,000 in a cold market and $20,000 in a hot market. So, in a cold market, the daily goal is, you know, a fifth of that or a quarter, that's about a,000 bucks, $1,500.

In a hot in a hotter market, the first cushion is $5,000 before I'm going to step up and be more aggressive. So this technique here of using smaller size of about one quarter to 1/5if of full position on my first few trades allows me if I go red on the first trade to recognize uhoh being red on the first trade is a precursor for potentially having a red day. So now I need to take my foot off the gas and stay with small size until I have recovered that loss and potentially gone green.

If I don't recover the loss and on trade two I'm also red. Another thousand. And then on trade three I'm also red, then I can say at that point I've had three losses in a row. Three strikes, you're out. That's baseball, right? So it works in baseball, it works in trading. So then I say I'm done and I'm down $3,000. Now my daily goal in a cold market is five grand. So being down $3,000 is not even losing more than I make in one good day. the $20,000 hot market goal.

Now, certainly in a hot market, I might be a little more aggressive. So, maybe I'll be down more like 5,000 on these first three trades, but nonetheless, it's still not more than I would make in a really good day. So, this has been the best technique that I have discovered for being able to determine whether today will be a red day or a green day and to make that determination with smaller share size. The best green days, I'm green on the first trade and I just keep adding profit.

That's the best the the worst red days. I go red on my first trade and I just keep having losses. So that first trade for me makes a big difference. Now I'm not a high frequency trading algorithm. I'm not taking a thousand trades a day. I'm taking a small number of trades each day. Even on my best days, I might only take 15 or 20 trades. So it doesn't really So in other words, th that first trade really does matter. With an algorithm that's taking a thousand trades a day, the first trade doesn't matter.

But for me, the first trade really matters. So I trade with smaller size. I break the ice. And now I can get a really good sense of whether or not today is going to be a red day or a green day. And so I want to remind you that you do not need to trade every day. A lot of traders over complicate this. You don't need to trade every day. You don't need to trade every stock that's moving. Your goal here is to have the highest accuracy possible.

High accuracy breeds self-confidence. And when you have higher levels of confidence, you trade with bigger share size. And that creates a positive feedback loop where you start making more money. So you don't need to trade every single day. In fact, you should not trade unless there's a setup that you like. And this all comes back to that sort of initial concept here of adopting a strategy, proving consistency, focusing on being a master of one strategy.

Be a master of one. That's what it's all about. So adopt the strategy, prove the consistency, focus on the process, not the profits, the honest assessment, and take the temperature of the market every single day. So, if you take that approach, you're going to realize that it's better to wait it out than to trade a lowquality setup. You trade a lowquality setup, you're going to get inconsistent results. It's going to draw down your accuracy.

You're going to get frustrated. Trade less and walk away sooner when it's not happening. This is really hard for a lot of traders to do. It's really hard for traders to walk away at the right time. In fact, there's a book here. Oops. Here, knock something off my desk. This book is by Annie Duke. It's called Quit: The Power of Knowing When to Walk Away. I couldn't imagine a better book title for active traders. This is really a fantastic book.

I've listened to it on audiobook. I have the physical copy and I only got it so I can show you guys the physical copy when I do these episodes, but it's really a terrific book and it speaks not it's not about trading, but it just speaks so much to the experience that traders have because I will say that the one thing that you could do that would really improve your trading over the next four to six weeks is if you can learn to walk away at the right time each day.

That's it. That is it. Walking away at the right time. Think about it. Every day you're doing one of two things. You're either leaving money on the table because you walked away too soon, or you're giving back profit because you stayed too long. How do you find that sweet spot? So, I'm going to jump back on the whiteboard. So, number six, walk away. I'm going to say sooner. Learn to walk away sooner. And so the way I approach this is that given that every day I'm doing one of two things, I either am giving back profit or I'm leaving money on the table.

What I would like to do is I would like to as a beginner encourage you to sit down and focus on trading until and this is shouldn't even be a dip. This is just like trade one, trade two, trade three. Trade until your first loss. And at the first loss right there, walk away. If you right now are a beginner trader and you don't yet have a track record of six weeks in a row of profitability, then you need to be so disciplined about taking the profit when you have it and not overstaying your welcome.

That can mean just doing one trade a day. Just one trade a day. Now, in my recent um episode that I just taught, and I'll put a link to this at the end of today's class as well, I broke down how to start trading in nine steps. And I shared with you guys a trading plan that I encourage all beginner traders to utilize. It includes phase one of taking one trade a day. That's it. Get in, get green, get out. For the sake of continuing to gain experience, you trade the rest of the day in the simulator or you may even trade the beginning of the day in the simulator until you see that one really good opportunity.

You take that with real money and then the rest of the day is back in the simulator. The the advantage of doing one trade a day is that it's very black and white. It's one trade. There's no breaking the rules, just one trade. And if it's green, great. And if it's red, bummer. Now, over the course of 10 days, that'd be two weeks. If you're red 70% of the time, that speaks to accuracy being poor, and you need to work on improving your accuracy.

But if you're green 70 or 80% of the time, then I would say, "Holy smokes, we've got something right now that's working." So, and you're making money, right? So, now what it's time to do is begin increasing your share size. Don't increase the number of trades. Increase the share size. You start with 100 shares, then you go to 200, 300, 400. You just keep increasing a little bit each week. And then next thing you know, over the course of 8 weeks, 12 weeks, 16 weeks, you're now getting into four, five, six months of trading.

You're still doing one trade a day, but you've worked your way up to a,000 shares, 2,000 shares, 2,000 shares, 15 cents, 300 bucks. You're talking about $75,000 a year. And again, setting the bar low. Now you're thrilled. You're like, "Wow, I'm setting the foundation. I'm taking one trade a day. I'm getting in. I'm getting green. I'm getting out. I'm not overstaying my welcome." Now, when you've got a track record with that kind of uh when you've got that kind of track record, it's going to build confidence in in yourself.

And so now you're going to start taking bigger size and you're also going to start feeling comfortable taking more trades. And that's where we get into this concept, which is trade until your first loss. And once you have your first loss, then at that point you walk away. So beginner trader phase one. So phase one is one trade per day. Phase two is one trade per day but with bigger size. Phase three is increasing to multiple trades per day and continue with bigger size.

Phase four is scaling in. Phase five is scaling out. These are the five phases that I teach in for warrior pro members in our classes. This is the way I would approach it. And so I would encourage you if there was one thing that I would focus on over the next four to six weeks, it's walking away sooner. And I don't want to be dismissive of what I've already shared with you because the fact is that requires an honest assessment.

Walking away sooner means requiring an honest assessment of how strong is the market today? Should I continue to be aggressive? Is this a hot market? Is the window open for opportunity to capitalize on the volatility or has the window closed and I have to walk away? So, what I find in my trading that I typically do is I don't want to walk away while I'm still making money. So, I walk away after I've given back a little bit off the top.

But, you know what's really important? It's very important that on the days when the market is hot that you get to the point, and this isn't going to be when you're still taking one trade a day and you're a beginner and you're just trying to build proof of concept, but once you've been trading for a little bit of time, you want to get to the point where you're more aggressive on the best trades and on the best days. And this is this is tough because this requires that very strong connection to the strength of the market.

That very honest assessment of how strong is the market external and how strong am I internally, right? If you've just gotten off a redeye flight, you know, an overnight flight from, you know, eight hours, whatever, you're not at 100%. You didn't eat well, you didn't sleep well, doesn't matter that there's a couple stocks that you like, you're not going to be in a place to trade well. So to be able to really capitalize on this type of uh these trends in the market, what I what I'm doing is I try to keep my environment pretty consistent.

So I you know I sitting down each morning, same time, etc. And what I'm doing is I try to be really aggressive when it's hot and then cool off and then really aggressive and then cool off. So I have the cool off periods where I give back a little bit of profit, but how much I give back is limited because that's the thing. I just I I only want to give back so much, right? So that means being super super aggressive when it's hot and then trading a lot less when it's cold and then really aggressive and then back to, you know, foot off the gas.

And it feels like trading is a marathon. And so on the these little periods here, like this is these are the moments in the marathon where I can really gain some ground. And these are the moments in the marathon where it's raining or it's muddy. It's slippery and I'm just trying to stay alive. I'm just trying to keep my head above water. And if I can just keep my head above water, I know I'll get to the other side of this where I can put pedal to the metal again and get aggressive.

And that's where I'm going to make up, you know, some ground. So, trading is definitely about uh leaning in when it's hot and taking your foot off the gas when it's cold. But when you begin to trade your Aquality uh setups and you've got that strong DRA track record, that's where you're going to have the higher levels of self-confidence, higher levels of accuracy, and then you're going to start being on that positive feedback back loop where you're taking bigger size and being more aggressive.

So consistency, confidence increases profitability with a higher accuracy, high profit loss ratio. This is just the positive feedback loop that I want to see you on. It all begins right here with accuracy. So, if we were going to go back for a beginner trader right here, adopt a strategy, prove consistency, focus on high accuracy. So, if you're struggling right now with accuracy, I have two things that I'll share. Number one, accuracy improves with experience.

Doesn't m it doesn't matter what you're learning to do. If you're learning to kick a soccer ball, if you're learning to play basketball, shoot free throws, whatever. The more you practice, the better you will get. So if you're new, it's to be expected that you're not going to be tra you're not going to be performing at the level of someone who's been doing it for a decade or whatever the case is. You've got to build you've got to build experience.

You've got to practice in order to get better. So that's number one. Number two, for those of you guys that are Warrior Pro members or who have been learning the strategy that I trade every single day, what I set out for you guys is a road map. I give you a very specific set of criteria. the type of stocks that I'm willing to trade. Those are the five pillars of stock selection and then the very specific entries that I'm willing to buy on, right?

Those very specific chart patterns. So, by focusing on trading within the rules, basically what I'm giving you is a road map. I'm giving you the road map to follow. It's your journey to take that road map and to follow it. And you have to bring discipline to the table. And you've got to bring dedication and drive to the table. You've got to be motivated. But I really think that if you come to the table with low expectations, you come to the table focusing on the process and understanding that profits are a byproduct, then what you're doing is you're setting yourself up to succeed.

And sadly, what a lot of traders end up doing is they set themselves up to fail because they come in and they're saying, "I want to make $20,000 this month." And I say, 'Guys, you're you're doing this all wrong. You've got to focus on the process. The profits are secondary. But people come in focusing on profit, profit, profit. And they end up getting themselves into what ultimately is a negative feedback loop. So what does the negative feedback loop look like?

The negative feedback loop is when you come in on day one or your first week, your first month, and you lose money. And then you feel angry. So now you're dealing with emotional reaction because you're angry and frustrated. You don't want to feel this way anymore. The quickest way to not feel angry and frustrated would be to make back what you lost. So you're encouraging yourself to take more trades. And yet you still don't have a strategy.

So what ends up happening is you end up losing even more. And now you're even and you see what's happening. So even if this has already happened to you, we can cut this negative feedback loop right now by focusing on percentage. Focus on high accuracy. Don't focus on profit. Focus on maintaining as high of accuracy as you can. Higher accuracy means you're trading better quality stocks, which means your profit loss ratio is going to improve.

That's going to improve your consistency. That's going to give you more confidence to be more aggressive. And this is the beginning of the positive feedback loop. So accuracy right here is what you have to focus on. And if you're trading and you've been you you follow everything that I'm sharing with you and for the next month your accuracy is still 30% or 40%. All that says to me is that you need to get better and you need to gain more experience at understanding the type of stock to have the potential to make a big move.

You've got to re sort of orient yourself with those five pillars of stock selection and look at your patterns that you're trading. And all of that data can be revealed to you when you export your trading history because then you can see exactly what you're doing right and what you're doing wrong. Especially when you have a trader like myself that puts everything on the table so you can kind of compare what what is the difference between the way we're implementing the strategy if we're trading the same strategy.

The goal here is to trade without being influenced by emotion. This is far easier said than done. But emotions are generally the result of experiencing big gains and big losses or the feeling that you miss an opportunity. So, it all ties back to seeking to make as much as possible and not being satisfied with hitting your base hits. Now, I shared uh an example of this not that long ago where I had a day where I I don't even remember the details of how much I was up on the day, but uh let's just say I was up $100,000 on the day and I gave back 70% of it.

So, I was up quote only $30,000 on the day. And it was very easy in that moment to feel disappointment and to feel shame and frustration. And while there were some good reason to feel frustrated myself that I didn't follow my rules of walking away when I'd given back only a little bit, right? So, it's okay to be frustrated about that. If I kept trading, that would have been me seeking to no longer feel bad about losing that amount of money.

And suddenly, I've lost perspective of the fact that, you know what, life is good. I've still got more in my pocket than I had a few hours ago. So, if your daily goal is 40 bucks and you make 40 and you don't walk away and then you give it back and you're up only $12, it's easy to say, "This is nothing. I I'm going to keep trading." And in that moment when you're no longer grateful for what you have, it's very easy to sacrifice it and let it go.

Small base hit days are so important. That is how I've built my career. It is small base hit days. So this is over $20 million of profit right here. Well, that was the close view. We'll back this up. So $20 million of profit here over the last 10 years. 21 million. And it's not from hitting home runs. It's not to say there haven't been a few big winners here and there. There have been a few big winners and there have been a few big losers.

But if we just look year to date here, winning, and then we look at uh year-to date, and then we look at losing, and we look at year-to- date, I want you to look at the size of my average winners and cents per share, and the size of my average losers. Average winners are 18 cents. Average losers are 15 cents. And this is $6.5 million of profit. So, you do not need to trade every single day. You only should trade setups that you really have very high conviction in and you really believe will work.

So this year sitting right now just under let's see no we got to go back to year to date. So year to date here sitting just uh just under 72% accuracy 71% accuracy and I think that's really solid. There are certainly traders out there who traded a lot more than me and may have even made less. So it's not about trading everything that moves. Now this also means one of the things that's really important is to get to know your triggers.

So number seven, know your triggers. This means you you begin to develop an awareness of the things that can happen in the market that cause you to become emotionally compromised or emotionally hijacked. So giving back half your profit or giving back all your profit, going from green to red, going from green on the day to red is definitely a trigger for a lot of people, but going from green to giving back half or having missed a really big opportunity.

The more you journal while you're trading, the better you'll get at recognizing, oh, this was the thing that happened just before I started to spiral. So, unfortunately, all traders are going to have moments where you spiral and you end up having back-to-back losses and it just gets bigger and bigger and bigger and then you realize, okay, I I've got to, you know, take my foot off the gas here. And it's in hindsight that you realize, I should have walked away sooner.

And so, by journaling while you're trading, you begin to collect data about your emotional state of mind as you're going through the trading day. And then when you look back at that, you realize, okay, this is the moment where I wrote, I'm really frustrated. The second I wrote that, that has to be my cue to get up and walk away from the computer before I keep trading. Because when I trade from a point of being frustrated and angry, I don't make more money.

I lose what I've already got. And so if I was to boil this all down into the simplest suggestions of what you can do to improve your trading over the next four weeks, I would say number one, all of this ties in to being a more disciplined trader to bring discipline into your trading. If you've already got a strategy, you're good. If not, you need to adopt a strategy that's proven profitable by other people. You need to practice trading in a simulator.

You focus on the process, not the profit. You do honest assessments at the beginning of your trading and then certainly each day. You take the temperature with small size, you walk away sooner, and you know your triggers. If you could do all of this, you're going to put yourself in a position where you're taking small base hits, you're getting in, you're getting green, and you're getting out, and you're not overstaying your welcome.

This all comes down to discipline. It takes a lot of discipline to be able to follow all of these steps. But that's what it takes. Now, for me, the small account growth strategy, it's a type of trading that's very fast. It's very quick. Uh, you know, it's it's risk and reward like anything else. I take the risk and when these setups work, they work really well and they work really quickly. And so for me, it's pretty much instant resolution.

It's like breakout or bailout. I get into these trades and when we've got a stock that's got breaking news between 7 a.m. and 10 a.m. and it's the leading gainer in the entire market, these things work really well. It's my job just to be patient and to wait for these opportunities to come to be able to do that honest assessment of is today the is this the market where I'm going to see those types of gains. We've had periods in the last year where I come in each day and I I I'm very very confident, 90% conviction that I'll be up more than $50,000 on the day.

So, I'm already coming in tuned to be aggressive. And then there's other days where I'm like, I expect to make nothing today and I'll be pleasantly surprised, but everything is just tuned down. And one of the things that I do is I actually will take money out of my account when things start to cool off. So, I don't even I don't even have the ability to be aggressive, even if in the moment I thought I could because the fact is when it gets cold, it takes a while for it to heat back up.

And there's just no sense in being super aggressive when it's cold. So, I limit my ability to do that. And I think that's really key to my long-term success. When it's hot, those first few weeks of a hot market, I build profit very quickly. Then, I can keep adding to that profit with the gains I've already made because I can take bigger positions. And then once I have a couple losses and it starts to cool off, I clear out all the profit I've made.

I reset my account and we're back to kind of laying in the tall grass and waiting for things to pick up again. For those of you guys that are tuning in on YouTube, I'm going to put a link to the small account growth strategy. I'm also going to put a link to the nine steps of how to start day trading. And for those of you guys that want to check out a two-eek trial at Warrior Trading, it's two weeks for $20. You get to watch over my shoulder while I'm trading.

You also get access to a selection of classes from my Warrior Pro curriculum. And you get to use the same software that I'm using every single day for charting, scanning, and for finding breaking news. So, we'd love to have you guys come over and become a member. I'll remind you as always that trading is risky and my results aren't typical. So, I want you to manage your risk by practicing in a simulator before you put real money on the line.

And I'll just remind you as always that there's no guarantee you'll find success whether you trade with me or you learn on your own. So, it really makes a lot of sense to use a simulator before going live. Thank you guys for tuning in. If you've enjoyed this episode, I hope you hit the thumbs up. I hope you subscribe to the channel. And I will see you for the next upload real soon.