B The Trader

Kyle Williams discovered stock market trading in June 2016 and dove straight into it. It took him 12 months to become profitable. 3.5 years later he's up $115,000, so now he's teaching other people how to do it. Still a college student, Kyle gets up at 5.30 am to trade (he lives on West Coast), then goes to school and has a normal college student life. He shared how he structures his day to be able to trade and monitor the market while maintaining a full schedule. We chatted about Kyle's journey as a beginner trader struggling to become profitable. We discussed trading strategies that he used back in 2016, and how he managed to learn the market and become consistently profitable within just one year. We talked a lot about the mental, monetary, and planning aspects of increasing risk over time. He shared how much harder it is to risk 1% once your trading account grows and how he's pushing himself to accept that the same 1% represents that much more money. Kyle compared his current strategies with the setups he used to seek out at the very beginning. We talked about feeling confident about the benefits of starting with 1 or 2 setups instead of chasing tempting experiments and spreading yourself too thin looking for multiple trades and untested strategies. What did you learn from my interview with Kyle and what do you think about his trading path?

In our recent conversation, Brian Lee shared an equity curve simulator tool, and that was a complete game-changer for me. In the simulator, you enter your win percentage, your risk/reward ratio and a time period, and you really get to see your projected results over time. When you are trading, when you are "in the moment", you only see each individual trade, each loss, and each win. In one day you may lose 6 trades and you may only win 2 trades, leaving you with a pretty bad win/loss ratio. But as long as you stick to the 3:1 rule, all you lose is 6R. At the same time, by winning twice you get the same 6R, so you are actually OK at the end. However, you only get to see it this way if you're looking at the big picture, as you do in the equity curve simulator. In the moment, 6 losses in a row might seriously hurt your confidence and destroy your mindset. The lesson here is to pay less attention to the win percentage and each loss individually. Instead, focus more on following your profit plan long-term. I'm planning to give my 3:1 Reward to Risk trading strategy at least 3 months to let my wins and losses accumulate before drawing any conclusions. Subscribe to my newsletter to see my trading tips and follow me on social media to see the latest updates.

On Monday, December 2, I was in San Antonio for a wedding. On the way out I made a stop at a restaurant for breakfast and decided to check out the stock market and see if I could trade on the go on my laptop since I had Das Trader installed. Guess what, I haven't opened it on my laptop in months. My watchlist was outdated, so I didn't know what to look for. The Friday list of active stocks was saved in Das at home on my PC, and I didn't have any of this information with me. I did my own research on the spot and I got some leads from my buddy Carl. But I ended up not trading since I didn't see any great setups. I drove home, opened Das Trader, and saw that HEPA had a first red day after moving up for several days in a row. If I was home, I would've definitely seen this setup, traded it (I typically sell short), and made a nice return. I described this situation to my buddy Brian Lee (check out his interview if you haven't yet), and he laughed at me. He said that I should've used the Thinkorswim app. I actually use it, but I just didn't think of uploading my watchlist into the app before leaving for the trip. So now I'll be using Thinkorswim for charts and Das for execution even though I prefer sticking to just one platform. I also made a trade later in the day on Roku. It was a good setup, paired with some negative news for the company it was a great short sell. I made a 2.5-3R return on it and was quite happy to see how it turned out. Watch the video to see the full trade recap!

This past week I ended up with 1R loss. That was not the best result, but at the same time I'm pleased that the loss was so low - it means that I'm becoming more disciplined with my trading, and that's something to be proud of. I can also take pride in trusting myself a little more now. When I started, I didn't really believe in myself, and I used to get out of trades despite being right at the end because of a lack of faith. I learned how to trust myself with experience, but somewhere along the way, I lost it again as I started branching out and doing risky trades. If I didn't branch out and tried new strategies with actual size, I would have been ahead of where I am right now. But that's the tricky thing: once you start trading well and feeling like you've figured it out, you start thinking that you can predict the market when in reality you just need to react to it. I took some big losses due to trading random setups with an entire account, and that's a lesson learned. When you work with full size, you can risk less at a time - a 10 cent risk will set you back a lot when you work with volume. However, if you only operate with 100 shares, you can afford the whole zone (ex. $2-$2.25 range) to be tested. If I take a small position, I can give it a bigger range to see how it does, feel the trade and learn from it. And when it comes to small trades like that, the goal is not to make money but to gain confidence. I have a background in sales, and it also took time to learn how to control my emotions such as greed and impatience. The important difference between sales and day trading is that one mistake here will set you back all the way to the beginning, while a mistake in sales will only lose a single sale.

I've been working on believing in myself as this is something I've been lacking lately. I do it by sticking to my plan and doing things that proved themselves to be leading to profits. I also promised myself to not adjust my risk too soon. I decided to not get too excited, and add when I think that I should add rather than be scared of it. I like to add when things are bouncing rather than when they are dropping, and I did that today on two tickers - SRNE and HEPA. I did my shorting very well - shorting the pops, covering the dips. But most of all I was glad that I believed in myself and did it exactly right like I knew I would. There are some strategies that I know better than others, and there are strategies that I'm not so good at. So sometimes I trade a small amount just to get a hang of it and gain confidence. This journey is about knowing my weaknesses and strengths and finding out how I can make the most out of my experience no matter if it has a positive or negative impact on me at the moment. You see, I used to feel so negative about searching for a day job, but now I realize that it will help me succeed in my business and get a smoother ride while I'm trying to make it. It is my journey, and no two journeys are alike. Maybe my experience will help other people succeed in the world of day trading and show them that you don't have to profitable from the get-go to be a successful trader long-term.

I had a really honest conversation with my childhood friend, and he said that it sounded like I didn't truly believe in myself, like I didn't think that I could actually make it as a day trader. Sadly, I realized that he was right. All of those times when I didn't stick to my risk because I didn't want to take a loss, when I entered a trade and got out right away even though I was right - all of those times I didn't believe in myself, and that's why I did all those things. I'm not sure how to fix that except for pushing myself to believe more. After all, I left a very successful career to do day trading. I didn't make it the first year because I was still learning, but this year I didn't do very well because of a lack of self-belief. I'm trading right now, and I want to keep myself accountable, so I'll share the information here. I'm trading SSI, I'm short for an average of $4.41, risking $4.62. It has just closed first red day. I'm looking for a gap down and further. I am not cutting it unless I hit $4.62 or I hit my goal. It's been so stressful to look for a day job while trying to stick to my rules and do day trading. Sometimes when I'm feeling really low it almost feels like a failure, even though I know that it's not. I will keep pushing at it, and I know that I can multitask well. It will happen for me, it will just take time, discipline and consistency. Please support my journey by subscribing to my Youtube channel and listening to my Podcast on your favorite platforms!

I just wanted to thank all my followers and subscribers and all those who comment and like my videos. Here I will answer some of the questions that I've been receiving on social media. Oscar Sanchez: "For me, the hardest part was discipline. I have discipline but it can be inconsistent because my heart is corrupted by my hopes and dreams. The problem is, we're human beings, and humans are just unstable and inconsistent. The battle with yourself never ends." I agree with the statement that it's hard for us to be consistent when the reason why we're doing trading is tied to our dearest hopes and dreams. It's ok to have goals and dreams such as buy a house, take the family on a vacation, escape the 9 to 5 grind, but you don't want to hang up on the goal alone. It's hard to stomach losses when trading is all about the outcome and not as much about the process. Watch the video to see me answer more questions about trading, starting this show, my winning and losing strategies, selling short vs buying long, tools and resources that I use for trading. Again, thank you so much to everyone who comments and likes my videos and who listens to my podcast! Subscribe to my Youtube channel to see more videos like this one and listen to my podcast to get more content about day trading and trading tips!

The week before Thanksgiving was pretty good. My win rate was 50%, I had 3 wins and 3 losses. However, my biggest win was three times bigger than my biggest loss, so I did well overall! This upcoming week I will focus on 2 main things: Trading only the best setups when I see them. Not being afraid of the setups that I've been practicing lately, but with tiny position size. Another thing that I need to focus on is the positive outcome. In a weird way, whenever I'm trying to avoid a loss, I always lose. I talked about it earlier, and I see it more and more in my trades. In his book "Trading In The Zone", Mark Douglas says that every tick that goes against you feels that much more if you're afraid of losing. When you have this mentality, you are effectively looking for signs that you will lose. This is what I experienced last week when trading MYOV. I set my exit area too low despite it being close to a key area because I didn't want to lose on trade after I missed the profit area earlier that day. So I ended up losing 5 cents. It wasn't a big deal as I broke even at the end of the day, but it proves my point entirely. For the week ahead, my focus will not just be on seeing the positive and believing in myself, but also following my trading strategy closely. How about you? What's in the store for you this upcoming week in trading?

This is the paradox of day trading: I lose money whenever I focus too much on not losing money. I missed a cover on a short trade that I had. And because I didn't realize the profit, I didn't want to turn that trade into a loss. It started as a right setup and a great position. I held MYOV overnight and was comfortable holding it pre-market because the resistance area was shown as $13.13. But as the trade opened, it showed me a new resistance area at $12.40 (now I know it was really $12.50) Initially, the stock opened up in my favor. It tanked immediately down to $11.60, but I missed it. After that, it popped back up to $12.40s where it has started. As it went back up, I set my stop at $12.40. This was my thought process: if I missed out on a profit, at least I didn't want to turn this trade into a loss. And this is one of the lessons: whenever you choose a stop, round it up to a dollar or half-dollar number. In hindsight, $12.40 was really close to $12.50 which was key for this stock. It is a magnet; the price often spikes up to hit round numbers only to move away from them in the next moment. The price hit $12.50 (which was above my stop) only to bounce back down into an $11 area. As a result, I missed out on a profit opportunity and incurred a small loss. It was only a small 5 cent loss, and I broke even at the end of the day. But I learned my lesson about estimating the resistance area and rounding my stops. Have you experienced a similar situation?

Brian Lee is a consistently profitable trader. He started in the gaming industry as a professional Dota 2 player as a part of the Team Liquid. He quit pro gaming as he wanted more flexibility with his time, and the stock market gave him just that. He invested his money into a trading account and started his journey day trading. Last year he changed the way he was managing risk by setting a max loss with his broker. There were a few reasons for that. His account grew bigger over time, and he started experiencing liquidity issues, so trades were not always getting cut right on time. Additionally, he got into a habit of bailing himself out of big losses by averaging instead of just cutting the losses. Eventually, he was stopped with his broker one time when this scheme backfired and the losses were too big. Ever since then he's been sharing his experience with risk control, as that was the information less talked about at the time. We chatted about relying on the systems for risk control and taking the human element out of the situations where we are prone to emotional response. We also talked about PDT, mentorship for the beginner traders, and the mental component of trading. Check out the full interview below. Like and comment, and stay tuned for more interviews with experienced profitable traders!