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Short Trading-Week Volatility

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Written by Timothy Sykes
Updated 5/24/2024 4 min read
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Now is the time to step on the gas pedal!

Usually the summer months are marked with slower trading momentum, but this 2024 market is on FIRE.

  • The meme volatility is back.
  • NVIDIA Corporation (NASDAQ: NVDA) posted impressive earnings AND announced an upcoming share split.
  • The U.S. political election creeps closer.

There’s A LOT of volatility for small account traders to take advantage of right now.

And on top of that, we’re at the beginning of a shortened trading week!

Greedy market players are trying to squeeze the same amount of profits from a market that only offers four trading days this week compared to the usual five days.

That invites additional volatility that small-account traders can use to profit.

Volatility Can Be Dangerous …

tim sykes in arizona riding on a jeep
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I’m trading stocks that spike +100%* intraday.

Traders who ignore the rules could get stuck on the wrong side of this price action.

The reason I trade volatile penny stocks:

  • I can load up on shares because they’re cheap.
  • The intense percent gain gives me more room for error.
  • The price action can follow popular patterns.

>> This is the trading framework that my students and I use to profit <<

Volatile stocks can follow these patterns because people are predictable during times of high stress. Like when they have a few thousand dollars in a stock spiking +100%.*

Essentially, the stock patterns also act as patterns of human psychology.

Traders who recognize the framework in real time are free to build profitable positions. Take a look at the video below of Jack Kellogg trading SoundHound AI Inc. (NASDAQ: SOUN), a 520% spiker that followed our framework perfectly.

The more examples that you see, the quicker this will start to click.

Trust me, I have over 40 millionaire students and counting …

This Week’s Opportunities

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I mentioned in yesterday’s blog post that we’re looking for low-float stocks with news.

MGO Global Inc. (NASDAQ: MGOL) is a good example from last week. The price spiked 730% and StocksToTrade shows the float is only 7.7 million shares.

Take a look at the chart below where every candle represents one trading minute:

MGOL chart multi-day, 1-minute candles Source: StocksToTrade

But once a trader finds a move like MGOL, they still have to make a trade. For new traders who don’t fully understand the framework, trading can be difficult and frustrating.

But not in 2024 … 

We can track the framework that these stocks follow. And over my +25 years of trading, I’ve developed a cohesive process to draw profits from these moves.

Since the emergence of AI, we’ve been tracking the price action with a sophisticated trading bot.

Below is the alert that traders got for the MGOL trade last week:

MGOL chart multi-day, 1-minute candles Source: StocksToTrade

XGPT scans the market 24/7 for plays like this.

Plus, it includes potential entry and exit prices. There’s a whole trade plan.

>> Lean on XGPT until you understand this process <<

There’s a lot of volatility in the market right now.

As a new trader, without the correct instruction, you’ll likely miss these profit opportunities.

That’s what makes XGPT so valuable. There’s no time to waste, and XGPT focuses on real trade opportunities from day one!

Push hard this week.

Cheers.

 

*Past performance does not indicate future results

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”