There’s one big theme overriding my trading in this market. You’ll hear me talk a lot about it this month. It came up in last week’s Trading Challenge webinar, too. What is it?
Patience.
What does it mean to be patient in a choppy market?
I’ve noticed a lot of traders overtrading due to a lack of patience. That leads to churn and burn — the slow decimation of your trading account. At the same time, bag holders with huge drawdowns are being too patient.
This week’s penny stock trading lessons are about how, and when, to be patient. To be successful, you MUST learn patience. You also need the right tools…
If you’re someone who’ll stop at NOTHING to get what you want in life…
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3 Top Penny Stock Trading Lessons
Last week I gave a live-trading webinar. But I didn’t see anything worth trading. So, we did student Q&A instead. Importantly, that mindset shift was a solid example of this week’s patience theme.
Another week of trading starts & I want you to retweet/fav this if you promise to be patient/meticulous with your trades, taking singles & cutting losses quickly, no gunslinging or holding & hoping like too many newbies do. Be disciplined to avoid being part of the 90%+ who lose!
— Timothy Sykes (@timothysykes) February 14, 2022
Here are three trading lessons from the webinar. Read to the end to discover what you’ll learn when you watch the webinar replay.
Penny Stock Trading Lesson #1: Patience Pays in a Choppy Market
A lot of people want a repeat of early 2021. In that stock market madness, there were 20, 30, sometimes 50 potential trades every day. I remember looking at my hands a year ago and thinking, “I don’t have enough fingers to do all the trades I want to do.”
Now, I have too many fingers. I don’t need to take that many trades. The important lesson is that patience pays. I’m still up $10,623 so far this month trading conservatively. It’s all about being patient and meticulous.
How? By following the next penny stock trading lesson…
Penny Stock Trading Lesson #2: Focus on A+ Trading Setups
One question asked during the webinar was…
“What are the top three patterns or setups that you recommend a newbie trader should learn first in the current market?”
My immediate answer is simple…
The top three patterns I think newbies and veterans should focus on are the same three patterns I trade…
- Morning panic dip buys.
- Morning spikes.
- First red days. (For you short sellers seduced by the dark side…)
Those have been my go-to patterns for the past 20 years. But a more complete answer that relates to our theme of patience is…
Focus on your A+ pattern or setup. If you don’t know what your A+ setup is yet, study my 7-step pennystocking framework. Learn to recognize the different parts. Then study my trades, or one of the other mentors’ trades, to see how they fit.
If you already know your A+ setup … have patience. Wait for the trade to come to you. And when you’re wrong, cut the trade. Know the difference between patience before a trade and patience during a trade. Always follow rule #1 and cut losses quickly.
How? By meticulously sticking with the next penny stock trading lesson…
Penny Stock Trading Lesson #3: Make Trading Unemotional
Once in a trade, I’m not patient. I actually mock patient people. If you’re patient and it works for you, fantastic. My patience is in NOT taking trades that require a lot of patience.
When I watched Tim Grittani’s “Trading Tickers 2” guide, it was physically and mentally painful. I had nightmares of getting stuck in short squeezes or being overly patient. I highly recommend “Trading Tickers 2.” After all, Tim Grittani has made a lot more than me. Just don’t watch it right before you go to bed.
Whether you’re patient like Tim Grittani or impatient like me, you have to remove emotion. For Tim Grittani, that level of patience works. You have to figure out what works best for you.
The key is to make it mechanical. I cut immediately when a trade isn’t doing what I want. Tim Grittani waits until it hits his clearly defined risk. But we both leave emotions out of it.
For newbies, I highly recommend you create a trading plan and stick to it. Know your risk and potential reward. Use the Sykes Sliding Scale to prepare for trades. And remember, singles add up.
The big lesson is that patience is a double-edged sword if emotions get in the way. Do NOT let emotions determine your level of patience. NEVER hold and hope.
More Top Penny Stock Trading Lessons
What other trading wisdom can you glean from the latest webinar? I counted at least 15 more lessons to look for. Here are seven that stand out…
7 More Penny Stock Trading Lessons
Did you miss the webinar? Trading Challenge students can watch the replay here. Apply for the Trading Challenge below.
Here’s what you’ll learn when you watch the replay…
- How to organize your watchlist for maximum opportunity.
- What every trader should do on their first two-figure, three-figure, and four-figure day. (And why unrealized gains don’t count.)
- The weird poker analogy that drives my winning ways.
- Why OTC gap-ups happen. (Hint: It’s more than simple supply vs. demand.)
- One screen, one shot: the benefits of trading with a single laptop. (And why every impatient trader should try it.)
- Overall trend or time & sales? How you answer this could determine your success in the current market.
- PLUS: Penny stock lessons from an Olympic redemption story 16 years in the making.
Already a Trading Challenge student? I can’t encourage you enough to show up every week with solid questions.
Ready to take your trading to the next level? To access the live webinars and hundreds of archived webinars…
Take the Trading Challenge
Live webinars separate the Trading Challenge from our stand-alone products and newsletters.
Every week there are two to four live webinars from mentors like Tim Lento, Mark Croock, Matt Monaco, and me. Over time, lessons from webinars compound to grow your knowledge account. Come with questions and work to get better at trading penny stocks under $1.
Want more penny stock lessons from Trading Challenge webinars? Comment below, I love to hear from all my readers!
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