How to WIN at Day Trading as a BEGINNER in 2025 (Step by Step Guide)

[Music] in today's episode I'm going to walk you through how to win at day trading as a beginner and I'm going to break it down into three simple steps that you can Implement in your own trading and begin following today this is going to help you jumpstart your journey now at the end of today's class I'm also going to provide you with some recommended reading and some links to tools that you can use that will help you as you're learning how to trade so let's go ahead and Jump Right In now we know without question

that there are people out there who are consistently winning when it comes to trading I am one of them and I'll say I'm not going to sugarcoat things in this episode I'm going to put it on the table as real as it is learning to trade is hard when I turned $583 into $10 million you want to know really what the hardest part of that whole challenge was the very hardest part was learning how to consistently make just 10 cents a day that sounds like nothing and it is nothing but until you're able to consist

make even just 10 cents a day you will never Thrive but once you turn the corner and you're consistently making 10 cents a day then you can scale up and that's exactly what I did I went from 10 cents to 20 cents to a dollar to $100 and so on and so forth and next thing you know I was averaging over $1,500 per trade and I've now taken thousands of trades in my career so you have the benefit right now of being able to learn from someone who is third party audited verified profitable who actually

knows what they're talking about and what works in today's market what I'm going to do in this episode is I'm going to help you figure out what the pros are doing that is working for them once we can document what they're doing that's working then that gives you sort of a a road map of where you want to get to the question is well where are you right now and I don't know the answer to that you know of course better than I could but I can tell you what the pros are doing that's work

working and I can pull back the curtains and share with you what is working in my own trading so first of all professional Traders people who are doing this full-time who who at least are making a good living as Traders they have a tremendous amount of General market knowledge that they've accumulated over the years now some of it they may have accumulated before they even started trading just through you know maybe watching movies reading some books and things like that but they have sort of just a peripheral level of knowledge of how the stock market

works this of course is spefic specifically for Traders in the stock market but it's the same for Traders who are trading Futures Trading Forex paays or who are trading cryptocurrency there's just a general level of market knowledge that you'll need to pick up now this is fairly straightforward this is mostly the easy stuff that we're going to talk about first second they've got a great knowledge of the best tools and the best software this is something that is easy to kind of discount as being like not that significant but when I was getting started and

I can can remember this so I'm sure you may be in a similar position I had no idea the right type of software to use as a Trader I didn't know what accounts I should use I didn't know what I should use to find news I mean I was completely lost so it's easy for us to take us being more season traders to take for granted all of this general knowledge that we possess that beginner Traders lack so you first need General market knowledge and you need knowledge of the best tools and the best software

and then we get into the meat of really what separates the pros from the beginners Pros have a rule-based system or a strategy that they follow in their trading every single day by following that rule-based system or strategy they have produced a proven track record that they can draw on when I say draw on a track record when you have a track record of consistency you're able to look back on that when things are difficult you're able to look back and say wow okay I actually I know what I'm doing and when things are not

going well you're able to look at that track record and compare it against times that were better so the data that historical data is a huge resource the experienced Traders have but you don't have historical data until you've been actively trading so as a beginner you're coming in with nothing and that makes it that much more difficult to get started now in addition to a track record what a lot of prot Traders have is community support and peer support they've built friendships over the years with other traders in this industry they may be involved in

trading communities like what we have at Warrior trading and so they're not isolated they're not trading alone trading is is very difficult in the sense that you have to deal with big emotional ranges the UPS from having a great day but the downs from having a bad day this is a a job where you can come in and you can work a regular you know full work week and walk away with less money than you had at the beginning of the week it's not like that with really any other job right you have your flat

hourly rate you get paid no matter what for the most part but with trading you can get rewarded big time when things are good and you get a real big boost of confidence but when things aren't going well and you have that draw down that can hurt your confidence and then that can get you frustrated and get you angry and then it can lead to impulsive trading which is when you start to spiral now prot Traders know all of this and they've learned to become highly disciplined they also have the benefit of what I call

educated intuition after years and years of trading in the market you just get a sense of how things are going to move it's not really probably any different from another career where you have many years of experience you just you you develop this subtle sense of the way things are moving even if you're a truck driver something you might think is simple you you get a sense of how the vehicle's running and you could probably figure out very quickly when something's not running quite right but a beginner could be very hard to pick up on

those subtle hints but those subtle hints can be the difference a huge difference when it's a very important moment especially as a Trader so for instance when I saw GameStop starting to pull away in 2021 I already had at that point nearly a decade of experience under my belt I knew what I was seeing I knew what to do and during that week alone I made nearly a million dollars that was an incredible week it was the best week I've ever had as a Trader and I wouldn't have been able to capitalize on it in

that way if I had been a beginner because a beginner wouldn't have been able to pick up on those subtle cues the very minute signals that are in the market because as Traders we are trading the financial markets and what we are primarily using is technical analysis now we're going to get into this more in a few minutes and I'm going to show you some Candlestick charts but when I'm showing you Candlestick charts what you're going to realize is that these candlesticks create the universal language of the market and once you learn to read this

language you will see the buy and sell signals plain as day right on the chart I'm going to teach you how to spot those and how to use those as entry and exit indicators in just a moment okay so now let's talk about step one how to acquire the general knowledge so when I'm talking about general knowledge I'm talking about the general understanding of how the stock market works the Dynamics of the market and the general understanding of tools platforms and things like that so I would first ask you what is your learning style now

you're obviously watching a video right now so on the left I have watching videos you've got tons of videos educational content on YouTube there's movies on Netflix and and all of you know tons of other places that you could watch they'll teach you about the stock market so you could pick up a lot of information for free when it comes to General market knowledge now if you're the type of person who likes reading you can pick up a book you could do some reading I'll give you some recommended reading at the end of this episode

um this is my book right here that I wrote how to day trade the plain truth so for people that would prefer to read you've got it in written form right here of course you could listen to it on an Audi book and then you have Learners who are Hands-On I'm a Hands-On learner I learn best by getting in there I don't want to go through you know an instruction manual to start to build something I just want to start putting the pieces together that's my style so what works better for me is to actually

open a trading account and this what I did when I was getting started and just start kind of pressing the buttons and see what happens now I will preface that it's very important that you open a simulated trading account so when you're pressing these buttons you're not making and losing real money at the very beginning of your learning curve when you know basically nothing about trading okay so if you're a Hands-On learner then by all means you can open up a platform you can start trading and I'm actually going to put a link it'll be

pinned to the top of the comments and it'll be linked in the description where you can do a two-e trial at Warrior trading if you want and you can start using our plat platform just to get a sense of what it's like you could use the scanners the charts be in the community and start to feel like you know really immerse yourself in in in this environment of being a Trader but again it depends on your learning style for where you're at so Step One is acquiring the general knowledge and these are three different uh

three different paths that you could choose and you could do all three if that works just as well for you but when it comes to general knowledge this is something that I think can be learned more or less uh for free at a very minimal cost just through watching videos reading books and maybe doing some Hands-On learning okay so step two is either developing or adopting a system I can promise you that every Trader out there who has a consistent track record of profitability and success has a system a set of rules and a strategy

that they follow that's what allows them to keep making money so if you want to win at day trading you need a system that you're going to follow all right so what I'm going to do in this section of this class in this episode is I'm going to share with you the system that I follow and I'm going to share it with you high level so you get a good sense of the way I trade now my strategy maybe different from the strategy that you plan uh to trade but really you have two choices when

it comes to step two you could develop your own system and strategy or you could adopt one that is proven profitable by somebody else now if you try to develop your own the challenge that you'll have which is the challenge I had is that it'll take a significant amount of time to produce a track record of consistency so you're going to do a lot of paper trading a lot of this and a lot of that a lot of kind of testing different things out because you know you're you're just essentially trying to figure it out

on your own so the benefit of adopting a strategy that someone else has proven profitable is that you can sort of hit the ground running with something that you already know works right the engine's already running so you can kind of roll with it now just because it works for someone else doesn't guarantee that it'll work for you and that's because of CH differences in risk tolerance differences in aptitude and perhaps differences in the tools that you might use and things like that so that that's true but I also think it makes a lot more

sense to start with something that's already working and then if you need to make adjustments to it you know go from there because the fact is clearly someone else has already proven that this strategy works for them so whether you take my strategy or you take a strategy from anyone else that's fine just make sure that the person you're learning from is actually proven profitable that's very important because there's a lot of people unfortunately on YouTube and you know Tik Tok and Instagram and the other places that kind of put out General market commentary and

talk about strategies but they're content creators they're just getting paid by social media essentially from ads they're not real Traders they don't actually make money trading so in order to vet who's qualified incredible from who's not what I always would look at is broker statements so if you're curious you can see my broker statements on my website they are verified and they have been audited you can see the whole audit result if you'd like okay so now let's talk about the strategy that I'm trading every single day so my strategy first of all we've got

to choose the market that you're going to trade so for me personally I'm trading the US market and I'm trading the stock market I'm not trading uh Forex I'm not trading Futures I'm not Trading cryptocurrency not that you can't trade any of those or all of those but my choice of Market is to trade the US Stock Market and specifically I focus on trading um equities so I'm trading stocks and I'm trading uh primarily small cap stocks so small caps now the thing with small caps that I like is these are uh these are relatively

small companies and when they have a news Catalyst they can make AIG move when you have a small company that all of a sudden has news of a partnership with like Amazon or apple or something like that the small companies value can quadruple overnight we see huge moves in these small cap stocks so even Traders with small accounts which was me when I was getting started can still do well now if you're a Trader with a small account and you're trying to trade stocks like Exxon Mobile or fizer Johnson Johnson or even apple or Amazon

outright those stocks don't move that much on any given day not in percentage terms so if you have a $1,000 account just for instance and you're trading a stock that only goes up or down 2% in one day you're only up or down 20 bucks and that's if you put your whole account into that trade it's going to take you a long time to grow the account in contrast if you're trading a small cap stock and it goes from $2 to $4 in one day that's a day where you could double your account so I

gravitated towards those types of stocks when I was getting started due really to the parameters that were sort of set upon me based on the fact that I didn't have a lot of money I had a small account and I needed to try to make money relatively quickly which did put me in a position of a little bit of desperation which I wouldn't recommend because there really is no such thing in my experience as quick money or quick success in trading but there's no question that more volatile stocks will produce bigger percentage returns and for

traders that are looking for more growth that's what you're going to want to focus on so the market is small cap the time of day I used to trade from about 9:30 until 11:00 a.m. each day and then what I noticed and this started happening uh really during 2020 was uh prior to 2020 when a company would have news they would put out news generally pre-market before the Market opens at 9:30 so they might put out a headline at 7:30 8 8:39 whatever but no one really traded pre-market everyone just waited until the market would

open in fact a lot of Brokers didn't even allow pre-market trading or if they did you had to very specifically um change your time and force for an order in order for it to work pre-market so as a result a lot of people didn't even know how to trade pre-market and then in 2020 the market was going insane we we had this 30% drop and then we had this huge rally and when we started to Rally if a stock had news what we noticed happening was people started buying it just before the open because we

knew like right at 9:30 when the market opened all the Traders were going to react to that breaking news and suddenly we started seeing at like 928 people were buying and it was like whoa what's happening it's pre-market Market's not even open then it was like 9:25 then it was 920 9:15 so people just started to get in a little earlier a little earlier a little earlier so as of right now the window has moved uh earlier in the day it used to be starting at 9:30 now it starts at 7:00 a.m. so my window

has begun a little earlier and it still goes to about 11:00 a.m. and the reason here is that before 700 a.m. even still a lot of Brokers do not allow trading so if they start allow trading as early as 4:00 a.m. which is currently the when the pre-market session opens we may see trading start even earlier although I think realistically even today what we notice is that between the hours of 700 a.m. and 12:00 p.m. oops 12:00 p.m. the volume sort of goes like this so the volume increases as more Traders come into the market

and then as we get kind of past 10:00 a.m. it starts to weighing back down as people are like ah I've kind of made my money so if they start if they really let people start trading more actively as early as 400 a.m. I I you know you'd have European Traders but maybe the curve would move a little bit forward but there's no doubt that it would still Peak sort of right around the hours of 8 to to maybe 9:00 a.m. okay so nonetheless the time of day right now that I'm focusing on trading my

strategy is between the hours of approximately 7:00 a.m. and 11:00 a.m. and typically what I find is that right at the top and the bottom of the hours 7 7:30 8 8:30 9 9:30 Etc is when companies put out their press releases a lot of times they schedule these in advance so they're just scheduled to get released top and bottom of the hour they don't schedule it to go out at like 7:27 some odd they just do 7:30 8 8:39 and so as soon as that news comes out this is what happens that news catalyst

is received by the market and if there are certain keywords in that news headline high frequency trading algorithms immediately initiate buy orders and instantaneously the stock will start moving up so stocks don't move up without people pressing the buy button and they don't move down without people pressing the sell button so they're moving in response to the news but the people who get the news first are those highfrequency trading algorithms so what we typically notice is that we'll have uh a news headline that comes out and let's just say it's at 7: a.m. and instantly

there's instantly a big green candle like that as the price starts to squeeze up and that's when we know okay this is something that we got to start paying attention to and from that point forward I'm looking at the stock chart and I'm starting to get dialed in so we're going to talk more about this in just a second so let's jump onto the Whiteboard or back onto the screen share so we've got uh number one for my strategy the market number two the time of day number three we're going to talk about the amount

of capital in the account so this is going to vary depending on where you're at so you could have as little as I mean you could have as little as $100 with a Robin Hood account or something like that but let's just say $500 um sort of minimum starting point and having more is only going to give you more buying power which allows you to grow the account faster a 10% return on a $50 account on a $500 account is 50 uh you know 10% return on a $5,000 account is 500 you know so on

and so forth so if you add more money then that same 10% return gives you obviously a bigger return and and how much profit you can make but for most beginner Traders you want to start small you want to manage your risk you don't want to get in over your head because you will make mistakes as a beginner just the way I did that's part of your learning curve it'll be part of your experience so it's better to have a small account early on make those mistakes where the total cost the total damage won't be

as significant won't hurt as much okay so uh account size amount of capital in the account let's just say three U $500 to start and now number four you need to have a system of um selection so how are you going to choose what you're going to trade now if you're Trading cryptocurrencies a lot of traders in that market are focusing on which cryptocurrency has the biggest percentage gain today and you might see one that's up like 3,000% or something like that some of these really small altcoins with currencies you maybe do similarly with regular

Forex looking at pairs that are at the biggest uh rate of change today same with the Futures Market you'd look at oh today we've got oil moving we've got gold moving natural gas whatever it is and with the stock market I'm doing really the same thing I'm looking for things that are moving so to help you better understand the philosophy behind this on any given day in the stock market we've got 10,000 stocks that you could choose from how do you possibly select the one that's going to go up it would feel like choosing a

needle in the hay stack but here's the thing that's interesting out of all those stocks in the market on any given day I would say 98% of them are going to trade within this range of up 2% or down 2% they're not moving most stocks on any given day you know they'll move up a little bit they'll move down a little bit but they're within a very narrow range after all the S&P 500 over the course of a typical year is returning 10% in a whole year so even broken down per month you're only talking

about two two and a half% a month so when you're talking about per day we're getting very small moves in underlying assets especially when you're looking at large cap stocks so if we said well let's just as a starter say that a stock has to be up at least 5% what you're going to do is you're going to eliminate from 10,000 stocks each day you're probably going to draw down to a list of about 50 wow so this filter right here of just saying I need something up at least 5% is going to help you

weed out 95% of the stocks 98% of stocks then what we do from here is we say all right well let's look at this list and let's sort let's look at the top number one leading percentage Gainer let's look at the number two leading percentage gain the number three number four and number five and this is the same thing people do really in all markets like I said whether it's cryptocurrency it's Forex or it's Futures you're looking at the biggest movers the reason we want to trade big movers is because this is where the attention

is Traders are very active so we're focusing on what's moving today and on any given day we're switching our Focus to what's moving on that day what's moving is it's almost a magnet for attention people start focusing on it next thing you know people are buying it people are actively trading it that's going to result in higher volume better liquidity which means you can move in and out with larger positions and if you think about it we as retail Traders are the commodity for commission free Brokers commission free Brokers they get paid not by us

when we you know they don't there's no commission right there used to be commissions there's no commissions they get paid when we trade because every share that we trade they get a kickback in the form of payment for orderflow and they get that Kickback from the wholesalers so they're going to encourage you and all other retail Traders me included to trade actively so what are they going to do they're going to say hey look at the biggest percentage movers today this is up you know 150% this is up 300% you know Etc they're just going

to be like helping you they're really drawing your attention even more onto this top list and just like the top list of you know a Google search it's the it's page one that people really look at and it's the top two or three results that people really look at it's the same it's the same mentality that's just the way it is so what I'm going to pull up here for you in the background are uh the scanners that I'm using so these are the scanners that are actually searching the market in real time and uh

this right here is showing our top uh percentage gainers on the day and the top one today is 50% the next one Down's 46% next one's down 43% we can look at the price of these stocks we can look at the volume 39 million shares 66 million shares these have a lot of volume these are definitely the type of stocks that we want to look at now I'm going to walk you through a little bit more of the detail of how I make a choice of whether or not I'm actually going to trade it but

this is the tool that I'm using to find these stocks in real time so again Pinn to the top of the comments Linked In the description you could uh click that link and you could check out a twoe trial using the software if you'd like it's it's totally up to you it's two weeks for 20 bucks so you could get free access to the market data as part of that uh we include that we also include um the scanners the charts the news feed and you'll have access to a selection of my classes okay so

now if we jump back over here when I'm going through the stock selection process the first thing that I'm asking myself is what is our biggest percentage Gainer today and let's start breaking down uh I'm going to pull up uh these scans again so let's break down uh brfh so it's up 49% the price is $154 it's got 39 million shares of volume the float is 6.89 million shares for those of you that have never heard the term float Flo float is the number of shares available to trade it represents the supply for this stock

so when a company does an initial public offering they sell a fixed number of shares onto the market and from that point forward those are the number of shares available to trade that's the supply level now what's interesting about uh this particular stock is that it only has 6.89 million shares available to trade and yet it's traded 39 million shares today how could that possibly happen it happens because people are actively buying and selling buying and selling buying and selling to each other it's like hot potato people are getting in getting out getting in getting

out and that is called float rotation so let's just say for instance someone owned 3 million shares of this stock on a typical day when the stock maybe trades less than a million shares of volume it would be hard for them to sell all three million shares in one day there wouldn't be enough buyers for them to sell all those shares but on a day like today they could have sold all of those shares and the reason this is important is because the stock is up 150% and anyone who wanted to sell could have easily

sold and the stock didn't drop because it had enough buying volume to keep it up so the higher the ratio between the float and the volume today generally the bigger the imbalance between supply and demand and therefore the bigger percentage gains so that's why this is up 50% right now now there's something else interesting here which is the relative volume the relative volume on The Daily it shows us being 9,000 so what is relative volume relative volume is the comparison of today's volume versus what is normal or average for this stock over the last 30

days so that means over the last 30 days this stock trades on very light volume because today with 39 million shares of volume that is 9,000 times higher than normal wow so if a stock for instance trades on an average day with 1 million shares then today if it trades 1 million shares its relative volume is one because it's right at average if its relative volume is 0.5 that means it's half of what's normal and if its relative volume is two that means it's double what's normal so if the relative volume is 9,000 that is

huge so how does a stock go from having a couple hundred, shares of volume to having 39 million shares the next day it's a news catalyst so as part of my stock selection process so number one we're going to do number one number two number three number four and number five okay so number one we're going to look for um price to be between 2 and 20 we're going to look for relative volume to be five times or higher we're going to look for the percent change today to be 10% or higher at a minimum

we're going to look for a news catalyst so news Catalyst that means there's a reason the price is moving higher and we're going to look for a float which is the number of shares to trade of less than 20 million shares and lower is better but higher is going to be a problem because when you start to get higher you have a higher level of supply and it takes almost an unreasonable amount of demand to have that imbalance so see how the float on this is 6 million shares and the volume is 39 million that's

a good imbalance but if the float was 39 million shares and the volume's 39 then you don't have that float rotation so you likely wouldn't have had as big of a percentage move so you you want to see lower float with higher volume now if you had 300 million shares okay but if we look at the highest volume today of any stock in the market it's 67 million shares so so really it's not super realistic or very common to see 500 600 700 million shares of volume and as a result stocks that have floats that

are 100 200 300 million shares rarely make big percentage moves maybe in the future that'll change but that's the way it is right now so the reason that I've created these criteria is because these are all based on my personal historical data so let me show you this for a second okay so these are my metrics and we're looking at $12.6 million in gross profit average winner is about $1,500 $1400 average losers $1,500 accuracy 68% but let's scroll down here and look at um price and volume when we look at price and volume you're going

to see that I don't make a lot of money on stocks under $2 and I don't make as much on stocks over 20 I I make some money and GameStop and some of the others were added to this but it's not as common so the area where I consistently do the best is when the stock is priced between 2 and 20 so for that reason my educated intuition my proven track record tells me focus on stocks between 2 and 20 now next one relative volume being five times if we scroll down here what we will

see oh we got to go over to um I think it's instrument here so we're going to jump over to instrument we're going to scroll down again so we're going to look at performance by instrument relative volume all right so performance by instrument relative volume and notice right here that over $10.2 million of the profit was on stocks that had five times higher relative volume on the day I traded it so if I see a stock and it's got only one relative volume of one to 1.2 I now know I shouldn't touch it if it

has 1.5 to 1.99 I shouldn't touch it two to three well I can make maybe a little bit on it 3 to five I could make a little bit on it if it has more than five or it has like 9,000 that's the place I need to focus so this strategy and this stock selection um these criteria this isn't just arbitrary this is based on actual historical data of my own trading number three percentage on the day let's scroll down here performance by instrument movement 10 % $1.4 million okay so once again boom backed up

by analytical data now these two are not reported on the metrics that I'm showing you right here they don't show the they should but for some reason they don't they don't show the float and they don't show the news catalyst so what I had to do was I had to manually track over a Ser over a period of time all of my trads to see whether I did better if I had a news Catalyst and where the float was under 20 million shares float being under 20 million hands down without question definitely have to have

it the news Catalyst this one's a little bit more objective because or subjective because here's the thing with the news Catalyst um for instance GameStop did GameStop have a clear news Catalyst it had momentum it had a catalyst but it was it exactly news not exactly and so I have found that there are times where because of sector wide strength because of sentiment in the market that there can be great opportunities but there's not necessarily a specific news catalyst so as long as all of the other criteria are met I'm going to trade it and

the News Catalyst I would recommend for most beginner Traders because it'll help you stay out of maybe trades that aren't going to go as well just to sort of like make sure there's a reason it's going up but the fact is if the price is right if you've got the relative volume if you're up at Le 10% if you've got the right flow combination and maybe as a bonus um we'll put this down here is most obvious today if it's also the most obvious today meaning it's the number one leading gapper on your scans then

that's really reaffirming that this is the one that you need to focus on right so now this one just took its place back BAC so all of a sudden later in the afternoon this thing squeezes up now what we might look at on this is what's driving this higher and as I'm looking at the news feed right here the last news headline was from yesterday so it actually does not have fresh news today which means what's driving this move is at least initially not clear I mean you never know it could have been could be

like Jim Kramer one of these people mentioned it on the news and all of a sudden people are buying it and that's fine but how long is that going to sustain the move of what's now 82% right I'm not sure but this is actually a good example of something that we were just talking about the float is 1 million shares the volume right now is 485,000 shares so it's not quite a full float rotation of one but it's getting close the relative volume is three you know 3.35 so reg its average volume is pretty low

in these last few days but what we know about this is that it won't take a lot of volume for us to see a fairly significant imbalance between supply and demand and for the relative volume to increase fairly quickly up to 7 8 9 10 and higher so this could be the type of stock to keep an eye on and right now it's obvious because it's the number one leading percentage gainer in the entire market so is it meet this yes yes yes no yes and yes so this would be worth watching okay so this

is going to give you this helps you I I hope get a really good sense of um the stock selection process all right so now we have to talk about risk management how are we going to manage risk we know that trading is risky we know that anytime you take a position you have the risk of losing money so in order to manage the downside risk we need to implement several strategies then we're going to talk about where to buy and where to sell but I don't want to talk about where to buy and get

you too excited yet until we first talked about how to manage that risk so you're no doubt managing Risk by having a relatively small account if you have $500 $1,000 in your account you're definitely capping your risk because you can only lose so much your account's relatively small but when you're looking at a trade what I always say is that a trade should have the potential to double whatever you're risking but that means at the beginning of the trade you have to determine how much you're willing to risk now unlike maybe other areas in life

when it comes to trading let's just say you put the full $500 into a position you could say I'm risking 500 but that's not really true because you're only risking 500 if you're going to hold until it goes to zero which would be a terrible thing to do because it would mean that when it was down 20% 30% 40% you just decide to keep holding even though obviously you were totally wrong on the trade so what if we set a stop let's say of more like $50 so I'm going to put a $500 position into

this but if it goes down and I'm down $50 I'll sell and I'll take the loss that's called implementing a stop loss so that's what I would recommend is is setting some type of stop loss before you take the trade based on the dollar amount of how much you're willing to risk so if you're willing to risk $50 that's fine we're then going to look at the chart and we're going to help understand based on nearby support how many shares can you buy with only $50 of risk okay so based on $50 of risk your

profit Target should always be double so if you're going to risk 50 you should have the potential to make 100 if you're going to risk 100 you should have the potential to make 200 and here's the really cool thing if you can maintain a 2: one profit to loss ratio what do you think your break even point would be your break even point with a 2:1 profit loss ratio so the five um set of rules and then number five we're going to talk about risk management and I'm just going to write profit loss ratio 2:

one or better and accuracy 50% or better so if you had a profit loss ratio of 2: 1 33% would be your break even point that would be break even just 33% time if you had a 1:1 ratio 50% is your break even and if you have a 2:1 ratio sorry a 1:2 ratio where your winners are half the size of your losers you would need to be right 66% of time to break even that's not realistic for beginner Traders after all you just saw in my metrics that my accuracy is 68% and I've been

doing this for more than a decade so you can be very successful at 68% but only if you've got a good profit loss ratio so if you're struggling as a beginner with profit loss ratios or you're struggling with consistency and this is what I would say I look at trading in Three core components you've got your um accuracy your profit to loss ratio and your consistency um we'll just draw a little picture of a calendar here it's just going to be faster all right so consistency is the number of weeks that you're green in a

month right so over the last few months how many weeks were green how many were red accuracy is the percentage of all your trades are winners and your profit loss ratio is the ratio between your average winners and your average losers what a lot of beginner Traders struggle with is low accuracy a terrible negative profit loss ratio where the average losers are bigger than the average winners and of course the result is that they're losing money so when you're in this situation and we're talking about risk here what I focus on I always tell people

is accuracy focus on accuracy which means do not take trades that don't give you a 2 to1 profit loss potential do not take trades that don't meet all five criteria for stock selection don't take trades that are outside the time of day that you typically trade that are outside the market you typically trade right as long as you're following all of these rules then you're going to be focusing on what I would call an A+ quality setup a quality setup but a lot of beginner Traders maybe through boredom feeling like they need to trade every

single day if there's nothing that's a quality well they just sort of say well I'll just trade trade whatever is here if it's a b quality I'll trade it if it's a c quality I'll trade it but let's just say for instance that on a quality setups let's say your accuracy is 65% on B quality setups let's say it's 60% and on C quality setups let's say it's 50% so unfortunately the more you lower your standards the more you're going to introduce losses and occasionally some of those losses could be big and then that's hurting

your profit loss ratio which in one day one big red day could hurt your consistency and your accuracy so start number here start right here number one focusing on a quality setups by focusing on a quality setups your profit loss ratio will improve it'll improve because you're exposing yourself to fewer losses and those losses are going to be more measured with an improvement in profit loss ratio consistency is going to improve and then what happens right here is you start to develop what's called a positive feedback loop which creates self-confidence and that's what's going to

encourage you to increase your share size to start to scale up to be more aggressive and that's where you're going to start increasing profits profits are getting bigger but if you're not careful the exact opposite can happen you can go on a negative spiral where your profit loss ratio declines your your accuracy declines your profit loss ratio declines your consisteny declines and now you start going on a downward spiral where losses are getting bigger and bigger you're losing your confidence and for some people they can blow out their account so it's very important to cultivate

a mindset that creates and and supports you trading at your best and that means focusing first and foremost on high quality setups okay so you're looking at high quality setups and whenever you're thinking about trading you're thinking about a profit loss ratio of two to one so you're going to risk a dollar to make $2 as long as you're write 50% of the time well as long as you write uh 33% of time your break even if you write 50% of the time you're going to be making money going to be doing just fine okay

so now let's talk about where to buy and where to sell now I'm going to pull up um another slide deck here uh this is actually um a slide for my warrior Pro curriculum this has over 1,600 slides in it but we'll just start here this is a Candlestick chart and Candlestick charts are the most popular type of chart that active Traders use they each Candlestick communicates four pieces of information a Candlestick communicates the open the close the high and the low so if I draw a candle very quickly here this candle this is the

open this is the close that's the high and that down there is the low a red candle the only difference is that the open is here and the close is at the bottom this is still the low and this is still the high so this is a candlestick and a Candlestick can uh it is basically reflecting all of the price action that occurs within a period of time so if this is a 1 minute candle this encompasses all of the price action that occurred within one minute if it's a daily candle it's encompassing all the

price action that occurred within one day it's a 5 minute candle it's a 5 minute five minutes of price action what's interesting is that the shape of the candle communicates Market sentiment and multiple candles together create what we've come to learn as recognizable patterns that tell us whether we should buy or whether we should sell this is part of the universal language that you're going to be learning so and then some of this is part of the General market knowledge of understanding candlesticks and some of it is really focused on the Nuance of your strategy

okay so I'm going to do a little animation here we have a a stock where the prices just started to move up and let's just say for the sake of argument that this this meets all of our criteria for being the right type of stock to trade based on the price the flow the number of Shar uh the um the relative volume how much it's up today and a news catalyst so initially the news came out and the price starts to squeeze up it pushes a little higher it goes even higher and then it starts

to dip it pulls back now at this point right here a lot of beginner Traders would think oh it's going down I shouldn't touch it right it's weak it's going down I guess it's all over but what a more seasoned Trader would look for is what's called a pattern in the volume so what we would look at on something like this is that on the candles that are moving up like this we would want to see the volume bars are increasing which means more people are buying as it moves up and then when we get

this candle of pullback right up here you get a little pullback a little more pullback we would want to see light volume on the selling this indicates an imbalance between the buyers and the sellers where there are more buyers than there are sellers when this is the case then I always look for the first candle to make a new high when that first candle makes a new high what we're looking for is a reversal of the trend so the trend's moving up the trend is moving down and now we're looking for the first candle to

make a new high right here and as that candle makes a new high we look for that surge back through the high of day this is one of my favorite patterns as a Trader because what I love about this uh particular pattern is that my Max loss is always the low of the pullback right here and my entry is always the first candle to make a new high first candle to make a new high so let's just say this is my entry right here and that's my Max loss and let's just say the difference is

six uh 10 and 6 that means I'm risking 10 cents per share so if I'm risking 10 cents per share how much do I need to make in order to justify my profit loss ratio of 2 to one 20 cents okay so now I look at the chart and I ask myself is this first Target 20 cents away if it is then I'll definitely take the trade and I'll hope that we extend even higher but even if we don't I could still take profit right here and have a nice 2:1 profit to loss ratio now

as long as the stock truly meets all of our criteria for being worth trading most likely what's going to happen on this first pullback is that Traders are going to buy it the stock has news it has a reason to be moving higher and people are excited about it here's an example of this pattern so we have the price that moves up right here surges higher on the first pullback pulls back second pullback right here first kale makes a new high and then off it goes let's look at another example first move up pull back

moves higher pull back moves higher yet again first and second pullback moves up moves up pulls back moves higher pulls back moves higher first and second pullback pullback pullback little dip little dip pushes a little higher this is the pattern that I trade again and again I mean this chart's from 2017 this one's from 2020 this one's from 2020 there's charts here from I mean this is these are years and years of me trading the same exact pattern and I could pull up examples of this today we continue to see this pattern and it's because

this is a universal language of the market Market that's what it is it's the universal language buying the first and second pullback right here Traders see that the price is moving higher they're excited about it they want to buy it they want to get in they want to ride the momentum higher so the place to buy for my strategy I have a number of different setups that I trade I have dozens of setups I trade and I be happy to teach you all of them but just for the sake of keeping this class concise but

hopefully ALS so comprehensive for you I focus one of my favorite strategies on buying the first pullback because it's easy to find that setup and it gives generally good resolution my accuracy on it is strong okay so that's the place to buy now where do I sell where do I take profit so when I first get into a trade my set of rules is that when I first get in there's a few things I want to see number one I want to see the price move up and I'd prefer to see it move up at

least 10 cents within the first minute of getting in because then I can set my stop at break even I can move my stop from $6 up to 610 at my entry price and I'm now reduced my risk to zero so I want to see the price move up 10 cents I want to see volume going up volume increasing more volume coming in I do not I do not want to see big sellers now when we're trading as active Traders we have access to something called level two Market data level two Market data shows us

the depth of the market and when we're looking at the depth of the market we can actually see if there's a really large seller so this is showing the number of shares that are for sale at these different prices this one's 20 this one's 2 1 1 one4 none of these are particularly big sellers so not really worried about that uh we could pull up uh BAC this one that's up now 87% it doesn't have a lot of sellers but does have more sellers at 65 than it has at 50 right more sellers at 68

so once you learn how to read the tape in this fashion you're reading the level two you're actually going to get a better sense of where the stock is going to go so I do not want to see big sellers all right so once I get into a trade I want to see the price move up 10% I want to see volume increasing I do not want to see big sellers so what are my exit indicators my exit indicator is if the price does not keep moving up if the volume declines or if I do

see a big seller and this is standard exit indicator essentially for the rest of the trade so the price goes down like 10 cents the volume is declining or I see a big seller if I see any of these things as this is moving higher I jump right out it doesn't matter if I'm up 5 cents if I'm down 5 cents if I'm up 25 cents if I'm up $5 a share once I see these exit indicators coming in that's my cue to get out now for what it's worth I am simplifying this a little

bit because if I'm in a trade and I really am up two or3 do a share I'm going to give it a little bit more room because I've got such a big profit cushion maybe I'll see volume decline a little bit but the price is still okay and there's no big sellers there so there is some subtle variations to how I would implement this but one of the things that I'm trying to convey for you is Simplicity and starting by keeping a simple set of rules is always easier and then once you gain more experience

you could take the training wheels off and you can start testing out well I see that you know volume is declined but there's no big Sellers and the price is you know still kind of moving up so maybe this is one where I'm going to experiment with holding a little longer but you're not allowed to get comfortable experimenting and deviating from sort of the written r until you have first proven consistency so one of the big questions that a lot of beginner Traders have is when to stop trading each day this is something that is

very hard so what I'm going to tell you is I'm going to share with you the set of rules I follow you could choose not to follow them but most likely you'll be giving back a lot more profit if you make that choice so um so when to stop number one uh Max loss so we set a Max loss on the day now I usually set it at my daily profit Target so if your daily profit Target's $200 your max loss would also be2 200 now certainly the goal is that you have more green days

than you have red days because if you had the exact same number of green days and red days you'd just be Break Even but we want your accuracy more than 50% so with Max loss at the opposite of your daily goal negative that would keep you um as long as your accuracy is high still in the green number two um let's see so after daily goal giving back half half lost so if you give back half now some people as a beginner and this is not a bad idea would stop trading as soon as they

hit their daily goal that's fine but as a more season Trader if you do that then you're capping your profits on some of your best days and statistically those the days that you should dig deep and trade longer until you give back profit now you don't want to keep trading every day until you give back half of whatever you've made but for me if I ever give back half I have to walk away then and there before I get emotionally activated because the feeling of losing too much of what I've already made can be really

frustrating that can trigger an emotional response so the most sort of intense area there is uh after hitting the daily goal giving back half but certainly going um from daily goal to Red down to Red would be devastating and absolutely have to walk away before you make it worse number four more conservative would be um walk away uh 20% off highs so if you give back 20% off the top walk away right so if your daily goal is 200 and you give back 40 bucks all right hit the road get out come back tomorrow you're

still walking away with 160 that's still a pretty good day number five if I feel angry if I feel angry if I'm starting to have sort of black and white thinking like this never works uh you know I I I'm I'm the worst traitor ever this is horrible you know if I start getting really extreme like that it's time to walk away because what's happening is I'm starting to become emotionally activated and when you become emotionally activated you could start to become impul impulsive in the way you trade a lot of this is coming from

fear and from anger for a lot of Traders and I've been I've gone through all of that myself and so I've beun to learn my triggers so I can walk away before I become fully emotionally hijacked emotionally hijacked is when the emotions take over and you're trading just from emotion you're no longer following your rules and that could be a very dangerous place so before I even get there I need to know my triggers so if I cross a certain threshold it's like walk away right now before I make a mistake so and ultimately this

all comes back to building discipline as a Trader having the discipline to trade just your Market just the right time of day to know the amount of capital in your account to manage your risk appropriately to choose the right stocks every day especially a quality setups to know where to buy to know where to sell to follow the rules about when to stop each day so how do we build discipline discipline is a muscle it's a muscle that will get stronger the more you exercise it so the way to build discipline is to do things

in your life that require discipline if you're not disciplined in your life naturally it's going to be hard to be disciplined in trading because the muscle is weak so whether it's disciplining yourself through exercise it's disciplining yourself through a daily practice of meditation it's disciplining yourself with food whatever it is you have to exercise discipline in other areas of your life so you can carry over to trading so personally the things I've used have been exercise and meditation and those have worked really well for me but what I'll tell you is that sometimes when trading

is going really well I will get a little complacent I'll be like I don't need to you know do all that stuff right now trading's going great and that's actually the time I need it the very most because that's when you let your guard down and that's when you can end up having a big mistake and I'll actually just show you I I mean and I've been doing this trading full-time for more than a decade um but but even still um I am human and let's just look at this overview here of my past um

60 days we'll do 90 days so I ended up making about $100,000 in this little stretch here about1 140,000 and I was being really aggressive but I was taking away some of the things I used to keep me disciplined the market was hot I was doing well and then look at these two huge red days I lost 30 Grand in two days being way too aggressive and breaking my rules so I then had to do a big reset I was like whoa okay stop right here before this gets worse I reset and of course I've

been able to rebuild which is great but this could have been avoided if I had maintained my practice of discipline in other areas of my life so in the moment when I was having a bad day trading I would have been able to make a better decision so I really encourage you to think about that uh but it's very important to focus on adopting um a strategy for building discipline okay step number three for winning at day trading you've got to practice trading you've got to review your metrics you have to put in the time

so if you start practicing the strategy that I'm trading every single day and you're you're of course welcome to I'm happy for you to do that then you've got just practice every single day in a simulator export your trades review your metrics and then when you're reviewing your metrics and let's just say for instance since let's look at my metrics here for um let's see I'm going to show you a month here um 30 this this shows something interesting so when you look at your metrics uh we'll get detailed and we'll look at performance by

uh well we'll do we we could do both of these so this performance by time of day tells a story what does it tell it's it says I lost money before 7:00 a.m. and I lost money after 1: p.m. in the afternoon so gosh if I had just stuck with trading from 700 a.m. to 11:00 a.m. like my rules State I would have done a lot better right the rules are there for a reason you know again I I chose to trade outside of them let's look at um Monday and Tuesday this is more of

an anomaly uh I wouldn't think too much into that but this is more significant uh for this period I did really well trading between 2 and and 10 and higher price and lower price PR I lost money on so this is a short-term Trend and it was a short-term Trend that Mondays and Tuesdays were bad and that's something to pay attention to right if there's something here that's not working you got to adjust it so then I said all right well for the next um 30 days I'm going to practice uh being more careful on

uh anything that's higher priced and let's look at how that's how that's uh paid off for me okay so now we're going to look at just um this last range and and here you see much better performance still took a few lower price but only down 1100 no big deal couple higher price okay I took a couple but manage the risk in a responsible way this is where the profit is so then the day and the time that's going to be better Friday's been a little slow but but nonetheless um time kind of an anomaly

here but doing well between s and 8 and being really disciplined to take the money off the table and not overstay my welcome now these are just little periods of time but what you have the benefit of being able to do when you're trading in the simulator is practice trading for a week for two weeks pull all the data look at the data and then make some decisions let that data tell you what you need to do and ultimately you're going to get to a point where you're looking at what you're doing right now and

you're able to start to better evaluate this is where I'm at this is where the pros are at because ultimately you have to identify the gap and you have to outline the steps needed to bridge the gap even after following these three steps I've just shared with you today if you follow my strategy and you're practicing in the simulator you'll likely as a beginner Trader still notice there's a gap between where you're at and where I'm at or someone else who's been trading for a long time and so the question is I mean ultimately if

you doing everything exactly the same as me you'd make the same amount of money as me so you're doing some things differently maybe it's in how many shares you buy which could be a measure of risk tolerance and account size and that's fine but maybe it's something more significant you're not very good at getting out of losers you're holding them too long or your entries are not very good right so then we start to get dialed in if you can outline the difference between what you're doing and what so the person you're sort of um

you know the road map of where you're trying to get to then that outline becomes the steps you need to follow it's like I need to now focus on better entry getting in a little earlier buying more dips avoiding this specific setup and that ultimately is the process of continuing to work and strive to improve as a Trader so like I said at the beginning of this episode trading is hard but the hardest part is the very beginning of becoming consistent and then once you're consistent it's like learning to ride a bike now you can

ride now every day you can come in you've got a consistent strategy you can depend on but you've got to put in a lot of work UPF front just to get to that point but once you get to that point that's when it's exciting the frustrating thing is that a lot of Traders will give up before Crossing that sort of threshold of becoming consistent they could spend a year two years they could spend five years and still not cross that threshold because they haven't been able to really connect the difference between what they're doing and

what successful Traders are doing they haven't been able to identify the steps they need to take to improve and get better they maybe haven't sought out mentorship they haven't tried to get community feedback they haven't fully immersed themselves in a community of Traders they're isolated whatever the reason is they're not able to bridge the cap My Hope for you is that you're able to bridge the cap now if you want to do a twoe trial Warrior trading there's a link pin to the top of the comments in the description come join us you could trade

side by side with me for two weeks you can see what it's like you can start practicing get your feet wet now if you want some recommended reading we've got some recommended reading over here so I'm going to jump on the Whiteboard here so you can see like this uh this is my how to day trade the plain Truth uh this is a great book by Annie Duke thinking in bets and a second book that she wrote The Power of knowing when to walk away you are I think you already know how important this is

as a Trader now um if you're interested in learning more about technical analysis and Candlestick chart specifically the Candlestick course by Steve niss is uh something you like you might be I would encourage you to try to find a free cop uh well a used copy because it's a little expensive if you buy it new um and in terms of helping cultivate a mindset of success I would check out this book called The Happiness Advantage by Shan aor I think this will help you a lot if you enjoyed this episode I hope you hit that

thumbs up I hope you subscribe the channel and stay tuned for more episodes about trading strategy just like this and I'll remind you as always trading is risky my results are not typical so manage your risk take it slow and I'll see you back here for the next episode real soon a