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How To Spot Winning Trades In A Declining Market

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Written by Timothy Sykes
Updated 10/2/2023 6 min read

Most traders start to freak out when they see the overall market going lower…

And being in this industry for over 20+ years, the latest market pullback isn’t anything I’m worried about.

You see, one of the best things about trading penny stocks is that they don’t follow the overall trend of the market…

Just take a look at some of these amazing opportunities from yesterday!

  • Femasys Inc. (NASDAQ: FEMY) was up 26%…
  • AERWINS Technologies Inc. (NASDAQ: AWIN) was up 76%…
  • IceCure Medical Ltd (NASDAQ: ICCM) was up 57%…

But there was one stock that had me jumping for joy yesterday morning that I didn’t mention.

If you want to spot some of the best opportunities in any market, you need to know where to start looking.

That’s why today I’m going to break down how I was able to lock in my biggest win in weeks…

And why every single trader out there should’ve nailed this play!

Being Prepared

It pains me to see traders who decide not to study and refuse to prepare ahead of time for what the market may bring…

And yet many of those traders still think they’re going to be successful in today’s market.

I hate to break it to you, but there’s a lot that goes into trading, and if you’re unwilling to plan for the day ahead…

Your trading journey is going to end sooner than you want it to.

All of my students understand what they need to do in order to be successful in this market.

Whenever you’re looking to trade, you need to have a game plan in place before the market even opens…

That’s why I’m always scanning for big percent gainers every day and keeping an eye out for that early morning panic.

You may never know what the market may throw at you…

And when the market hands you a “gimme” trade, you need to know how to take advantage of those opportunities.

Let me explain…

Taking Advantage

Every single one of you needs to know how you can take advantage of some of the easiest plays out there!

Yesterday morning, StocksToTrade Breaking News alerted me about Bionomics Limited (NASDAQ: BNOX)

Here’s the alert…

Source: StocksToTrade Breaking News

When this news broke, I immediately wrote this stock down and started watching it to see how it would play out…

And the one thing that caught my eye with this alert was that Stevie Cohen was involved.

I always tell my students to remember the past, and the longer you’re in this industry, you’ll start to see how certain plays can repeat themselves.

For example, you may remember my trade on Cybin Inc. (NASDAQ: CYBN) and how it soared from $0.33 to over $0.70 in just a matter of days…

Here’s the chart…

Source: StocksToTrade

That’s over a 100% move!

The reason I bring this up is because of the price action on CYBN after Stevie Cohen bought shares…

And seeing how CYBN reacted, I was looking for the same thing to happen with BNOX when I got alerted from StocksToTrade Breaking News.

This is why I constantly repeat myself about StocksToTrade Breaking News and remind all of you to be prepared…

Because no one should’ve missed BNOX yesterday morning.

If you want to be successful in this market, you must be ready!

When I saw the alert came out, I didn’t immediately buy it…

And as some traders tend to do that, you need to wait to see how the stock is reacting to the news.

Not every news play will result in a positive outcome, so you need to be patient…

And that’s exactly what I did yesterday morning.

Below is the chart of BNOX from yesterday…

Source: StocksToTrade

I want you to take a look at where I drew the line above…

I was focusing on that area as I was patiently waiting to see if it could hold above that level or break through its previous high of day…

Or for it to have a solid morning panic as traders digest the latest news.

Shortly after the market opened, BNOX had a morning panic before it was off to the races!

Source: StocksToTrade

I bought BNOX at $3.46 and sold it at $3.65 for a $2,425 profit! (Risked $24,950).

Even though this heavily shorted stock squeezed higher after I sold it, I was very pleased with my trade.

Trading is all about being prepared and focusing on taking the meat of the move….

And no one here should be looking to swing for the fences with one trade in hopes of making it big.

Every trader here should be focusing on locking in singles and remaining disciplined with their trades

There’s a lot that goes into trading, and I never said it would be easy…

That’s why I encourage all of you to take advantage of this FREE trading webinar every week to help you better understand what’s happening in this market.

I want all of you to be successful!

So keep studying and be prepared for whatever the market may throw at you…

And I’ll be sure to alert anything I see in chat. 

Stay safe.

-Tim

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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”