242 [Should I retire from options trading? (a LOT of wisdom in todays stream!) Dec 7, 2020]

  • NTZ, yeah could be a short, it’s super thin though, but yeah could be some mean reversion, but I’m not sure today’s gonna be the day, watch orls, vwap fails, the usual stuff, for a low risk high reward setup.
  • MRNA not short anymore, closed too strong on Friday, and it’s surfing the 20ema on the 60min, once it starts violating the 20ema that’s when I would like to reshort it, but hey this thing could go to 200 first, rn it’s in no mans land, I don’t see a long I don’t see a short on it.
  • There’s a lot of random stocks gapping, I honestly ignore all of them, like microcaps gapping 50/100%, I mean they’re great if you’re daytrading if you’re really quick, but for me as a swingtrader these are just random. A lot of these spac names gapping. There’s just so many of these low liquidity spac and ev related things, it’s the sector to be in.
  • PLUG bought some orhs. Stopped out.
  • TSLA looks beautiful, just beautiful. TSLA I think it’s gonna have a hard run up into Dec 21st, and I think it’s gonna go para, the question is, is it gonna go to 800 or 1000+? I think TSLA is really a thermometer for all the speculation money, if TSLA gets into trouble that’s when I think we should be worried. As long as TSLA is still going up, I think the market will be fine, and all these speculative stocks will be fine.
  • IIPR, setup is very good, really really good setup.
  • JKS had earnings, it’s in an interesting spot on the chart, has been building hls, has this range, is bouncing off the 50day, very interesting, big big momo stock. JKS is now fading, but if it holds here and doesn’t go much lower, and then reclaims later this week and breaks over this 65 area, it’s gonna be a really good setup.
  • THCB another battery spac. Bought some orhs.
  • LAC it’s one of these super hype stocks on twitter, if I see a good setup I will buy it, I have alerts set, if it gets momo it’s gonna double triple very fast, I just need a setup first.
  • WWR setting up in a nice nice way, reminds me a little of JMIA back here when I bought it on the stream [17/7/2020], was also $6/7, had a pop went sideways then brokeout again, then it tripled. This is what WWR looks like, popped, went sideways, and it’s the same price range, could be a good setup. I got stopped out of this thing, was in it overnight two days last week then I got stopped out, now it looks even better.
  • You don’t have to do a lot of advanced and smart things in the markets, success in markets is more about not doing a lot of dumb things, avoiding the dumb stuff, I truly think that, every year I try to do less of the things that don’t work.
  • Z going also, interesting, but very thin, Bought some orhs 30kshares.
  • NVDA see it going to 700 yeah absolutely, this thing has been basing really nicely for the past 4/5months, next leg up I wouldn’t be surprised to see it go to 700, I mean it’s not even a big percentage move, just like 26%, but it’s a slow stock, any of you shouldn’t trade it it’s too slow, if you wanna turn small accounts into big ones, you need to trade fast moving stocks.
  • I think if you’ve been consistent and following rules and also growing your account, that’s when I think you can add money to your account slowly. But if you have problems not taking losses even though you get stopped out, if you have these basic things you’re not able to do then you shouldn’t add money to your trading accounts. But if you have no problem taking losses, you trade good setups, you follow the rules, then you can add, slowly, as long as you’re growing your account, and more importantly just following the rules, have good position management etc, i.e. not going all in on one stock. Or you could choose to not add to your account, just let it grow organically, if you double then double it again and again, in five years you’re gonna have 10M in your account, that’s what happens. Easier said than done but it can be done, if you have a good setup with money management, you’re gonna do it, just need to study those damn setups.
  • This is one thing I actually got from Brandt on his blog, even the most successful traders and investors are gonna be in a drawdown most of the time. Like even this year, even though I’m up at least 500%, I’ve spent at least half of the year in a drawdown, at least, so expecting to be at peak equity all the time is just not gonna happen. You’re gonna spend most of your time in a drawdown, even on a really good year, that’s just how it works, you just need to realise it and accept it.
  • Look at something like AMZN, one of the best stocks ever in the history of the world, it’s up 200,000% since the ipo, now look at the amount of time it’s been in a drawdown, it was in a drawdown here like ten years [’99-’09], here for a few months, here for about a year, another year, another maybe year, this is like two years, so since ’97 that’s 23years, so out of the 23years it’s been public it was in a drawdown for 15years. Look at NFLX same thing here, even if you start counting from here at the lows of 2012 it’s been pretty much straight up, but even if you start counting from there, the stock is up 6500%, it was in a drawdown here for a year, another year and here it was about 1.5years, so out of 8 years it’s been in a drawdown almost half the time. So nothing goes straight up, these are just examples of stocks but this is what happens if you’re a trader or investor or whatever, being in a drawdown is not an anomaly it’s just normal. Now the question is how big of a drawdown are you gonna be in, I try to limit my drawdowns to 10/15%, but sometimes they become more severe than that, I think I’ve have two 25/30% drawdowns this year. Drawdowns are the nature of the game, if you wanna have big returns you are gonna have drawdowns, if you don’t have drawdowns it means you don’t take any risk, and if you don’t take any risk you won’t have any returns.
  • Some of these spac names that faded are starting to come back, SBE straight up from the 20day bounce, look at where these things bounced off the 20day, and some of them like BLNK so strong didn’t even touch the 20day, JMIA also 20day. XPEV testing 20day, the lows of the day bounced off the 20day. The 10/20day are so so important, if you’re a momo trader you need to have the 10/20day or the variations of them, I know some people use the 9/21ema, it doesn’t matter which one, but I think they’re super important, that’s really the only two indicators you need, and also vwap if you wanna short parabolic type stocks, that’s the only indicators you’ll ever need, more than than and you’re setting up for failure imo.
  • SWTX, avoid this it’s super choppy, trade stocks that are clean, make clean moves. Look at something like this it’s up it’s down it’s up it’s down, it’s been kinda inching higher but this is not a trading stock, avoid it, it’s a horrible horrible stock. Look at something like PLUG, it has a breakout it goes, it doesn’t chop up and down, it goes straight up, clean and linear, look at how it acts around the 10/20day, super clean. SWTX is just all over the place, it’s something you have to train your eyes to, seeing the difference between linear clean stocks, and stocks that are not clean, takes some time.
  • WDAY I don’t really like it as a trading stock, it’s one of these stocks that are very choppy, every time it tries to breakout it pulls back to an MA, it’s not really a trading stock, it’s more of an investing stock/can do options on it or can trade it on the weekly maybe, but yeah I wouldn’t trade it at all. You want to trade stocks that make big linear moves, bc those are the stocks that are more likely to keep doing big linear moves. And a good way to filter them out is to use a 5/6% ADR cut off so then you’re gonna pass on all those slow stocks automatically.
  • So I just track these movers, the notable movers, that’s how you train your brain to understand setups, you track them, this is how you learn what works and what doesn’t work, you can read as many books and go to as many seminars as you want, and I think it’s necessary to get a grasp of the basics, but other than that, to really understand what works and what doesn’t work in the markets, you need to do this, you need to track setups. I track breakouts, eps and parabolic shorts mostly, but whatever your setup is you wanna trade, you need to track it real time, you need to track those, see what works, what doesn’t work, not all setups work all the time but that’s how you learn, that’s how you train your brain, no one else is gonna do it for you, you need to do it yourself, every day, every week, every month. Like Livermore said this is not a game for the mentally lazy, you can be avg intelligence but if you’re lazy you’re not gonna make it.
  • GBTC I hope this thing stays tight like this today, or at least a few more days, I’m gonna triple my position in this thing, already sitting on a double. Already up 100% since I bought it but it was kinda illiquid down here, avg vol 4/5Mshares in the 11s, now it’s in the 23s and avg vol is 12Mshares, so it’s like 7/8x more liquid. I will prob 4x or more my dollar position. These coin related things can make just enormous moves. MARA also kinda strong but it’s kinda flagging, I’m gonna add to MARA also gonna triple my position if it starts breaking, it’s building a htf, and I think MARA had an offering Friday.
  • SI is straight up, where is your low risk entry? It’s straight up, I don’t see a setup here, that’s the difference between SI and GBTC. Guys you need to think in terms of setups. Setups, setups, setups. But yeah SI is in my crypto watchlist, I’ve just been waiting for a setup on this thing for a month now it’s been straight up, tricky one.
  • I’ve looked at all the major world markets, I’ve looked at all the liquid stocks for those markets on TV and I’ve looked for setups, and I can tell you one thing, the US markets are 55% of the world’s market capitalisation. If you only trade one market it’s gonna be the US market, you don’t have to be anywhere else, the whole world is in the US markets, how many foreign stocks are there, how many China Stocks, EU stocks, SA stocks, there’s hundreds and hundreds of them listen on the US markets, the whole world is, and if you’re a US company you’re gonna list in the US, but if you’re in Jap and SA, you’re prob gonna list in your market but also the US market too. You don’t need to trade anything else outside of the US ever.
  • I think that realisation (that you don’t know anything) is so important to have. Like Buffett talks about it all the time, it’s more important to know your limitations than to know a lot of smart things, sometimes genius lies in knowing your limitations. That’s the thing Buffett talks about it all the time, he’s seen so many smart people who don’t know their limitations and they get into trouble. Like look at long term capital management, some of the world’s biggest geniuses were in there but they just didn’t know their limitations and they blew up. What does it help you to be a genius if you don’t know your limitations, it’s better to be just avg intelligence and know your limitations and not get into trouble, sometimes that’s the true genius.
  • The second day I was trading, MuddyWaters hit that SNOFF, some kinda China stock or whatever, some of these US funds had pretty decent positions in it, hundreds of millions and even billions I think, that was a large cap company then MuddyWaters exposed it as a total fraud, the stock went down 95% in 2/3 sessions, and I remember playing the bounce on it, I had a tiny account, that was my second trade ever, I played the bounce, made like 10% on it, then after I sold it doubled in the next hour, and obv I was super pissed bc I could have doubled my account if I’d just held another hour, but I got super excited bc I thought moves like that happened daily, like at this rate if I just hold them longer I’m gonna be rich in a month, little did I realise I was just very lucky to be in the right stock at the right time, you do not get moves like that all the time. But yeah that one got delisted, I think like Paulson his funds lost like several hundred million in it, they were too slow to sell, just tells you, a lot of these funds have no idea wth they’re holding , same thing with this LK, you would be surprised how little DD some of these multi billion dollar funds do, bc they have so many positions right, there’s only so much DD you can do.


  • Paul Tudor Jones is also very big on the 200day MA.
  • I say something smart almost every day, but the problem is after I say it I kinda forget about it, it would be nice to have it in text.
  • Wisdom of the idiots, if you have a bunch of idiots and you put them together, they’re pretty smart.
  • Briefing, you can see news back 5 years, they nerfed it. It used to be you could go back to the late ’90s and see news from stocks, but they kinda since a few years ago, now you can only go back like 5 years.


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