My name is Tim Grittani (kroyrunner89), and I've been a full-time daytrader since the beginning of 2012. I've learned a lot along the way from my successes and failures and would like to pass along some of these lessons. This blog will hopefully save me time in answering the dozens of questions I get each week through Facebook and Twitter. If not, I guess I just created more work.
Before I launch into my recap of November, let me take a moment to thank all of you that took the time to reach out to me with words of encouragement following my last post. I truly appreciate all of the support and suggestions!
We're going to go ahead and do a video recap! It just comes across way better than text in my opinion, but if anyone would prefer I go to written recaps let me know!
For the past several months, I've been suffering through the worst slump I have ever experienced since I started trading. You really could say that ever since my PBMD loss in late May, I haven't been the same. I let myself turn into a stubborn trader with an inflated ego, someone who cared more about making "enough" money than about trading well. I notice that many of my favorite setups still work well, but my ability to trade them has greatly deteriorated due to mental and emotional mistakes. It has been incredibly frustrating and humbling, and one day in October it led me to ask that dreaded question, "Am I sure I want to keep trading?"
99% of the time, I absolutely love trading. I love the challenge of it and the potential reward if you're performing at your best. That's why it was so surprising to me to find myself in that place emotionally, because I'd never been there before. I had to stop and evaluate why I had suddenly had been pushed over that edge, when I hadn't even felt that low back when I was first learning and struggling.
When I finally came up with the answer, it was actually pretty frightening. I felt that I had lost the ability to control myself and my emotions. I wasn't losing because I couldn't make sense of the markets. I wasn't losing because my favorite patterns stopped working. I was losing because of ego. I was losing because time and time again, I would watch a stock blow through my mental stop point without taking it off. I was losing because I couldn't even get myself to put in physical stop losses, as I vowed I would do. I was losing because I'd get frustrated by all of this and then play the next setup with ten times the size I'd played anything else recently. You can guess how that usually ended. I thought about quitting because I couldn't stand the thought of possibly throwing away everything I'd worked so hard for, especially due to what boiled down to a lack of discipline.
Of course, we're talking about my lowest moment here. The other 99% of me that loves trading won out with ease, because I still believe in myself and enjoy trading so much. But it was still uncomfortable to find myself asking that question, and it was even more uncomfortable realizing how hard changing these bad habits really is. For example, I've been talking about needing to cut losses better since my LAKE loss last year - and two six-figure losses later here I am still talking about it. This is exactly why so many traders fail. It's easy to figure out the changes you need to make, but so many of us lack the fortitude to follow through and actually make and sustain those changes.
I don't want to be another failing trader statistic. I don't want to become a story about someone who made it big and then threw it all away. So now I'm going to truly get serious about changing, rather than just jumping back into the market as if everything is "business as usual," like I normally do after a bad run. I read my first trading book ever, Momo Traders, and am currently working through my first trading psychology book, The Daily Trading Coach: 101 Lessons for Becoming Your Own Trading Psychologist. I've lowered my position sizes drastically, telling myself that I will now only risk $1000/trade, or $2000, if it is truly an exceptional setup. I have also identified the three most costly trading mistakes I make and will be meticulously tracking them and working to eliminate them.
FOMO (Entering a trade due to Fear of Missing Out, rather than waiting for my ideal setup)
Trading too large (Sizing in with more than my planned $1000/$2000 risk for various reasons)
Failure to cut losses (Continuing to hold a stock beyond my planned stop point)
Every month, if I make one of these mistakes and take a loss, I will enter it into my log. At the end of every month, I'm going to use this blog to help hold myself accountable. I will post an end-of-the-month recap and share all of my losing trades that broke these rules, with details. The goal will be to see improvement every month, as I, hopefully, slowly eliminate these mistakes from my trading. ONLY when I've seen significant improvement will I begin to consider sizing up again.
You can expect a post from me in early December, recapping my November trading. It has already been a wild ride as I lost discipline for about a week and a half and fell into some very frustrated/emotional trading. More on that later!
Over the past couple of years, I'm sure I've frustrated many of my readers who have asked me the question, "What trading books do you recommend?" I've simply never had an answer. Reading trading books never interested me. I had skimmed a couple, but for the most part, I felt like I would just be wasting my time. My thinking was that I would rather spend my time learning by watching the market than from outdated info in a book. Sure, reading the stories of billionaires on Wall Street could be interesting, but there was no way I could relate to that or use it to make myself a better trader. By the time I even knew trading psychology books existed (one of the only categories that I think could be useful), I was already quite successful and felt like I didn't need them.
In late 2014, Brady (@MiltonaTrades) and Nate (@InvestorsLive) approached me and asked if I would be interested in being one of ten traders featured in their upcoming trading book, Momo Traders. The book would be written in a question/answer interview style and explore the path each individual trader took to eventual success, as well as the many lessons they learned along the way. I loved the idea and agreed to be interviewed, which turned out to be one of the most intense interviews I have ever participated in. The Skype interview took almost three hours to complete, but left me feeling great about the quality of information I had shared, and I was incredibly excited to read the interviews of all of the other traders who had been featured. In my mind, I was (and still am) a small fish compared to some of these traders, who make millions of dollars per year. Like myself and everyone else, they had all started as beginners once, with much less money to their name, and I wanted to read about their journey and learn everything I could from them.
Now, a year later, Momo Tradershas finally been released. As I had hoped, the stories inside are absolutely incredible. When you see these traders posting screen shots of their massive profits now, they don't seem human. However, to read all of their stories, hear about their early struggles, and learn that they came from the same place that you did, is incredibly inspiring. No two stories or strategies are the same. So I would suggest that you really take your time while reading each chapter, maybe read just one or two chapters a day like I did.
Another big perk to Momo Traders is that a portion of the proceeds goes to charity! Not only are you investing in your education, you're contributing to a good cause! There is SO MUCH to learn from each one of these traders, so I highly recommend you pick up your copy on Amazon or at momotraders.com. It's a very inexpensive investment towards your education, and you can learn how these ten traders, who were once beginners too, became the millionaires they are today.
For the past six months or so, those of you that follow me on Twitter may have noticed that I've been posting a list of stock symbols that I'm watching for the following day. I'll be the first to admit that this is not at all detailed regarding my plans for my trades - I just want people to have an idea of what I'm looking at. For those of you who haven't been following me, below is an example of what one of my watchlists might look like:
The responses I receive from users who view these watchlists are far-ranging. The most common question I'm asked is, "Long or short?" Sometimes, one of the stocks will make an especially severe move in one direction or the other and I'll get a "Great call!" Or every now and then I may even get an especially entertaining troll warning me not to short their company because it's going to save the world with whatever miracle product they're working on. Regardless of which of these categories you fall into, I want to provide a little bit more detail about what these watchlists mean and what I'm thinking behind the scenes that you don't see.
The truth is, when I list these stocks, I probably am short-biased most of the time. When I say short-biased, I mean that the primary play I'm looking for the next day is a short sale opportunity. But this is not always the case. There are some long setups I like as well. Which way I'm biased is always affected by the "big picture", how the daily chart looks. I run my scans, I look at daily charts, and I cherry pick the setups that I think I may have an edge with, long or short.
While all you see may be my list of tickers, far more goes into my watchlist than that. Below, you can see an image of the FULL watchlist that I created for myself the night before September 8:
As you can see, I have very specific plans for each ticker. In some cases, I have a plan for both a long AND a short opportunity, should the setup present itself. Just because a ticker is on my watchlist does not guarantee I will trade it the next day! When I pick my stocks, I have a VERY specific scenario I'm looking for in order to make a play. If that scenario doesn't present itself, I will not feel compelled to do something anyway with the stock. In some cases a stock I was looking to short will fade away all day, but I won't trade it once, because it never gave me the ideal setup I was looking for. I have absolutely no problem missing the play if that is the case.
This is how I trade day after day. My list of stocks changes, my plans change depending on the daily chart (and in some cases, some intraday details), and then the next morning I look for my top watches to, hopefully, give me an opportunity I planned for. I'm watching these stocks because they're liquid, because they're volatile, and because they're the most likely to set up in a chart pattern that I'm familiar and comfortable with.
I'm sorry I don't share my full watchlists on a nightly basis, and I have no plans to do so. I really do believe that it's possible to be too spoon-fed when it comes to trading and that it will hinder newer traders' development if they're just trying to follow other people's plans. I'll let you know what I'm watching, but you will only improve by making your own plans, trading your own niche, and looking for the setups that YOU are comfortable with. This may also mean making your own mistakes, but I know that I wouldn't have become a successful trader if it wasn't for learning from the mistakes I made day after day when I first started trading. Even now, mistakes are my best learning tool.
I hope my nightly list of tickers continues to be helpful, but I encourage all of you to form your own bias, make your own plan, and learn from your mistakes along the way!
UPDATE: Thank you to everyone who submitted an entry, so many of you have such great stories, this was a very difficult decision to make. Congrats to the winner, Matt P. (profitly user "Primez")! Matt truly stood out when it comes to giving back, he is a frequent chatroom contributor, going out of his way to help newer traders and answer their questions. But even more importantly, Matt spent time in the Marines, putting his trading aspirations on hold until he was able to return home. He's hungry to learn, not follow, and I know he's going to make the most of this opportunity. Thank you for your service Matt, I hope the conference is a great experience!
Last year, I was fortunate enough to attend the first annual stock conference and charity event, Traders4ACause. The event was absolutely loaded with talented traders and great speakers, but more importantly, it was about giving back. This year's event is September 25-27 in Las Vegas, and I highly recommend it to anybody who is available during that time frame.
Unfortunately, this year I am unable to attend Traders4ACause due to my upcoming wedding - which I'd say is a pretty damn good excuse. However, legitimate reason or not, I knew I still wanted to be a part of this great event in some way. After I discussed with Nate how I could best contribute, I decided to become one of the sponsors for the event. However, this leaves me with two tickets that I am unable to use! So, I have decided to give these two tickets away, along with a free copy of my new DVD to each person.
The first person I chose to give a ticket and DVD to was an obvious choice, Christian Nowakowsi, also known as "Stock Choices" (he doesn't know yet until he reads this blog). I had the pleasure of meeting Christian a few months back over dinner with a few great traders. He's a young guy who started out a lot like myself, trading mostly OTCs, but he has since made the transition to listed stocks. I admire his adaptability and dedication to making himself a better trader. Christian also shares a great blog dedicated towards trying to help other traders improve. He is an active member of the trading community, and I know he will capitalize on all of the opportunities the conference and DVD have to offer.
That leaves one ticket and DVD to distribute, and at the moment I have no idea who deserves it. So leave your comments below! Tell me about how you're dedicated to the market, tell me about how you give back, tell me about how this DVD and conference will help you! I know I'm going to get a lot of great feedback, and I will select one winner by the end of August 5th! There is only one condition - you MUST be able to attend the conference in Vegas from September 25-27. If you're going to potentially win a ticket, I want to be sure that you can actually use it! Even if you don't win, I highly recommend you attend anyway!
I look forward to all of your feedback. Good luck everyone!
My DVD has now been officially released, and the reviews are starting to come in! People have been reaching out to me to let me know their thoughts, and I've greatly appreciated the feedback! I'd love it if everyone who has seen the DVD eventually leaves a review in one form or another, whether it be good or bad. I appreciate honesty and transparency, so if you have any constructive criticism it is just as welcome as a good review.
For those of you who are interested, I'll do my best to keep this post updated with a link to the best discounted price for the DVD. Currently, the best deal is coupon code "NEXT100", which will save you $800!
Is this DVD good for a beginner?
I absolutely believe it is! The most relevant part for beginners in this DVD will undoubtedly be Chapter 2, which focuses on all of the tips I have for new traders. I started trading with absolutely no market knowledge, so I draw most of this material from mistakes that I made when I first started trading and things that I wish I had known from the start.
The main topics included are:
-Market and Trading Basics
-Basic Trader Lingo
-What is Short Selling
-Account Building 101
-Overcoming Your Emotions
-Intro to Market Scanners
-Handy Desktop Applications
If you learned from Tim Sykes, why not just buy his DVDs? What makes yours better/different?
My style of trading has diverted greatly from what Tim teaches in the last couple of years, to the point that we're rarely trading the same stocks anymore. I trade completely based off of chart patterns, and I only trade liquid stocks that are easy to enter/exit. So if you're looking for different patterns and different strategies, you don't have to worry about that. While Tim and I are both successful traders, there's a lot we do differently from each other.
The other aspect is that this DVD has 35 live trade examples, where I recorded my entries and exits and explained to you my thought process throughout the trade. This is so much more useful than looking at end of day charts and, in hindsight, telling someone where they should have entered and exited. Instead, you get to see where I actually DID enter and exit, hear how emotions played a role, see how I handle bad trades, and so many more subtleties that you'd otherwise miss completely. I will teach you the strategy, I will show you my attempts to trade the strategy, and I will explain exactly what I did right and wrong in every single trade.
What makes your DVD better/different than Nate's? (Investorslive)
While my trading strategy is closer to Nate's than Tim's, there still are quite a few differences between our styles. I must admit, Nate's DVD was a big inspiration to me to create this one, as I loved the idea of showing live examples as I traded them.
One big difference is that I go much more in depth when it comes to OTC trading, and although the OTC market is in the midst of a dead patch, the opportunities that do still come around like new promotion releases are some of my most reliable and most profitable trades that I make. You will also get both introductory/beginner information and specific trading strategies all in one DVD with me, while Nate has that split into two products. So you can definitely save a buck by getting it all in one place with mine.
How long is your DVD?
My DVD is roughly 16.5 hours long. At least 10 hours of this content is live trade examples of my top strategies.
Will the DVD be a hard copy, or streaming only?
There is currently only an option to stream the DVD on your computer. If this ever changes, I'll be sure to announce it.
Does your DVD teach level 2?
Yes, I teach level 2 basics and show new examples that I recorded to illustrate points. You can also find free level 2 educational material on this blog.
How many different strategies do you teach?
There are eight different strategies I cover in this DVD. Three of them are buying strategies, five of them are short selling.
How many of your 35 live trades are listed stocks vs. OTCs?
13 of the trades are examples of different OTC strategies; the other 22 are listed stocks (Nasdaqs.)
Do you show losing trades?
Absolutely! Some of our best lessons as traders are from our losses. 7 out of my 35 examples are losing trades. Several of them show me cutting a loss as planned, when the setup doesn't work. But in the others, you actually get to see me get stubborn, fight the stock, and turn a bad trade into a bigtime headache.
Let me know if there are any more questions you need answered!
Below you will see another video of one of my 34 live trades from my upcoming DVD, "Trading Tickers: the Long and Short of it." If you haven't seen it already, be sure to also check out the clip of my FNMA trade from Chapter 6, as it shows a very different type of play. I hope you all enjoy this clip, and please post below or on the youtube comments section if you have any questions about either one! If you're interested in learning more of my rules and strategies, please check out the DVD info link and get discounted early bird prices!
Below you will see a video of one of my 34 live trades from my upcoming DVD, "Trading Tickers: the Long and Short of it." I hope you all enjoy it, and please post below or on the youtube comments section if you have any questions! If you're interested in learning more of my rules and strategies, please check out the DVD info link and get discounted early bird prices!
UPDATE: Congrats to profitly user "Zero2Hero" for his winning submission - "Trading Tickers: the Long and Short of it"
As many of you already know, I am very excited to announce the upcoming release of my only DVD, a guide I have put together to teach my entire trading framework! Before I get into any details, I have to begin by thanking ALL of my followers over the past few years. The response I received when I started this blog was beyond any of my expectations. I was stunned by the traffic that poured into the site and the support I've received from all of you, especially during my struggles.
At this point, the one thing my DVD is lacking is a good name, so I'm going to turn to all of you for help. On my DVD profitly wall, please post your best name suggestion! Whoever provides the best suggestion will win a free copy of my DVD! This contest will run until the end of June 10, 2015, only one suggestion per person! Your help is very much appreciated!
I also must stress, THIS IS NOT a "Get rich quick" DVD! I will show you everything I have learned through my career that has helped me become consistently profitable, but that by no means guarantees success. Trading is not easy. In fact, 90% of traders fail. If you want to be a trader, you're in for a steep learning curve, quite a bit of stress, and wild emotional swings. This is NOT something to do for quick cash, and this is NOT gambling! This is for someone who wants to understand how to become a consistent trader, not someone who just wants to get rich quick. Viewing my DVD will not make you an overnight millionaire, but, hopefully, it will help guide you to becoming a part of the 10% that succeed.
From the time I became a consistently successful trader, the idea of a DVD has always been in the back of my mind. I wanted to teach my strategies, yet, I kept putting it off for a few reasons. Most importantly, I didn't want to sell ANYTHING that I wasn't 100% sure was a quality product. I knew it would take a tremendous amount of time and energy to put something together that met my standards, and until recently, I had neither of those things.
While moving to Colorado in 2014 meant waking up earlier and dealing with a 7:30 a.m. market open, it also meant that I was finished at 2:00 p.m. every day, giving me plenty of time after-hours to undertake this massive project. So, for the past six months, I have spent multiple hours per day constructing a product that I knew I could be proud of. From the most basic of concepts to advanced explanations of live trades, I have packed my DVD with all of the information I could think of that might be helpful to aspiring traders. The result is over 15 hours of content, including 35 live trades, designed to help you become a better trader. Below, I have listed the twelve chapters that will be covered:
Chapter 1 - Introduction and History
Chapter 2 - Important Beginner Basics
Chapter 3 - Basics to My Trading Strategies
Chapter 4 - Educational Services and Daily Preparation
Chapter 5 - Buying New Stock Promotions
Chapter 6 - Buying OTC Multiday Breakouts
Chapter 7 - OTC Short Setups
Chapter 8 - Buying Major Daily Breakouts
Chapter 9 - Shorting Lower Highs into Spikes
Chapter 10 - Shorting into Daily Resistance
Chapter 11 - Shorting Overextended Gap Downs
Chapter 12 - Shorting into Bounces
While the first four chapters lay the groundwork for everything that goes into my preparation before I even make a trade, the last eight chapters are where I dive into the specific strategies I use daily. Each chapter teaches a different setup that I play, including live trade examples of each strategy! You will see my entries, my exits, my successes, and my failures. But, most importantly, you will see the core strategies that allow me to be consistently profitable.
I am eagerly anticipating the release of this DVD and look forward to your feedback! I hope you will all find it useful and enjoy it very much!
Blog posts about large losses are usually the best ones to learn from, so it's a good thing for all of you that I have another to share!
From the time I took a loss on LAKE, as well as a large NDRM loss early in 2015, I've been very good about avoiding the frontside of large runners. I was letting stocks spike, exhaust themselves, and THEN I would strike. This spring, VLTC was one of the most ridiculous short squeezes we've seen in quite a while, and I managed not to twist myself badly on that one at all! I was incredibly proud of myself.
Then, in the last couple of weeks, my habits began to change again for the worse. I had an early short on VGGL that I chose to get stubborn with, but my stubbornness was rewarded as I came away with a nice gain instead of the loss I deserved (I was down $40k at one point.) I can't remember the other example, but I know that I was stubborn on another and was rewarded with a nice win. Point being, I fell back into bad habits, and those bad habits were reinforced, unfortunately.
The other factor that set the stage for my recent loss was boredom. I've been on a very nice run the last six weeks, finally feeling back in my groove. This week started out SLOW. I spent most of each day staring at the screen looking for plays, and I could find nothing major that I liked. So, naturally, I became impatient. I tried to manufacture my own plays. This is where my problems started on PBMD.
Above is the daily chart for PBMD. Most of this move occurred on a straight up spike into close on good news. The volume was nothing special. I believed I saw resistance on the daily chart in the 1.90s, so I started in short 21,000 shares at a 1.67 average. I figured this would be like so many other low-volume runners I'd seen recently and gap down the next morning. This is where I broke my first rule, not to short the frontside of a move, ESPECIALLY day 1. I was gambling that the gap would go in my favor, and if it gapped up, I figured that I could just add a little playing off of the 1.90 area.
Unfortunately, it never occurred to me that PBMD might gap up HUGE. Above, you can see the PBMD chart after hours Tuesday and premarket Wednesday. I was watching PBMD after hours spike into the 2s, and knew I was in trouble. My position was at Centerpoint. Unfortunately, Centerpoint does not allow GTC orders. So I was unable to cover premarket Wednesday into the large dip because I couldn't have an order sitting there. I actually did try, but as I expected, the order was cancelled. THIS IS 100% MY FAULT, I KNEW THIS GOING IN. I just didn't care. I still had the nonchalant, "I can always average up if I don't get covered" attitude.
As I watched PBMD gap up premarket and then open, I could see that I wasn't going to get my pullback for break even. So I decided to dig in my heels and fight. I was going to add big into spikes and then cover up into pullbacks to let myself out. If I was early on my adds, I would simply cut the losses on key high of day breaks. Through managing my position this way, I was sure I'd come out okay. After all, how high could it possibly go? It was already up from the $0.50 area!
Above is the first hour-and-a-half of market action on PBMD. Volume was absolutely massive now, so adding size wasn't difficult at all. Around 10:06, I added 40,000 shares at about $2.70, a bit early. The $2.95 high of day rejected though, so I was happy to hold on to my adds. As I watched PBMD fade back and fight in the mid $2s, I could see that there was a lot of support. It even briefly cracked the $2.60 area, yet no large breakdown occurred as I expected. I covered about 29,000 of my adds in the mid 2.60s before the next large perk up. To my dismay, the high of day $2.95 broke, as well as $3.00. I didn't want to take off the rest of my adds for a loss though! So I decided to dig in my heels again. I now was riding 32,000 shares from just over a $2.00 average. My unrealized loss was getting ugly.
I managed to sit on my hands until the perk and fail through $4, around 11:40 a.m. After the low $4s rejected, I once again tried adding large size into a lower high. I believe I brought my total size up to about 80,000 shares at this point. The $4.08 high didn't hold for long, though, and I was forced to cut my adds. Unfortunately, I made ANOTHER mistake here, once again only cutting partial size. I now had over 50,000 shares as PBMD continued to rip higher.
PBMD was quickly through $5 before I knew what had happened, and my unrealized loss was ballooning. After topping out at $5.48 and having a hard pullback under $5.00, I decided to try one more time into the rebound. I added large once again, risking off of the $5.50 area. Once again, PBMD ripped to new highs. At this point, I was mentally done. I cut everything into the strength, quite poorly, as I didn't even get out at $5.50. My covers were closer to the $5.80 area.
When all was said and done, I had a $188,000 loss on PBMD. I managed to recover a little bit of those losses before close, but below, you can see the end-of-day damage:
I actually had quite a few nice short entries into pops over $6.00 the last few hours of the day, but I fell into a homerun mentality and wouldn't pay myself into dips! I had a chance to minimize the damage, but I failed.
To recap, here are the mistakes I made:
Shorted on Day 1 of a runner into close
Decided to average up and fight rather than cut the loss after large gap up
Ignored massive volume
Made assumptions about how high it could or couldn't go
Refused to cut entire losses on adds that didn't work
Went for the "Homerun" and revenge on late day trades
Amazingly, I feel totally okay mentally after this loss. I'm more annoyed with my poor discipline than anything else. But I'm super excited to attack PBMD again going forward when the trend is finally on my side!
Stubbornness KILLS. I really hope you don't have to learn that lesson the hard way multiple times like I did. For all of the times it works out in your favor, the PBMDs, LAKEs, NDRMs, VLTCs, will wipe those gains out AND THEN SOME. Stay safe out there. Good luck the rest of the way with this ticker!!!
Since we're entering a new year, I figured it would beneficial to do a quick post updating some information that may be out of date or not clearly stated on my blog. I hope everyone finds this beneficial and it answers some questions!
Brokers I am using:
Centerpoint Securities (ETC)
Centerpoint Securities (Wedbush)
Other brokers I have used and liked (for various reasons):