All right. So I am locking up my first max loss red day for 2024. Such a bummer. Totally avoidable, you know? And this is the thing with trading is like your success or failure is going to come down to your ability to be disciplined and to follow your rules.

And today I kind of started to spiral. so I'll walk you back to sort of the beginning of the day and then we'll get into the charts and we'll look at the trades and everything else. So the day started, you know I Looked at my scanner at like 6:30 in the morning and the biggest gapper was like 15% I mean there was nothing on the Gap scan 7: a.m. it wasn't much better.

18 20% going into the open, our leading gapper was 28% I mean this was really bad. So from The Gap scan perspective there was nothing with volume. there was nothing with momentum and it is pathetic that I am read this much on a day like today that did not even close have the potential to get give me $6,000 or $10,000 or $155,000 of profit. This is rookie mistake.

All right. Well, we can learn from Rookie mistakes and even people like myself whove been trading for a long time were not totally immune to making these mistakes. So uh, my first trades I made about $350 It was a small winner. Um, we had a stock that started to squeeze up and I I kind of felt like H I don't know I S chasing it but but I jumped in and it ended up going.

Went quite a bit higher but I had small size so $300 was my first trade. Second trade I lost about $50 or $60 Third trade: I made $55 So I'm three trades in. We're coming into the open and there is no you know what I mean like clearly this is not a hot day because I I haven't had any good winners So that by itself should have been my cue just to say like, listen, let's just walk away like who cares if it's 9:45 or whatever, just there's nothing moving. let's just just walk away.

but no I kept trading I stayed and Roma Chinese IPO got me again. This has gotten me two or three times so this stock is such garbage. anyways. I get in it and um, it pops up and then it halts down hard.

It just does a nasty Rejection it drops. There was a bounce off the low which I made a little bit on actually I I don't know if I made anything on that, but anyways, there's a bounce off the low. But regardless, I was right on the trade. 1,200 bucks.

Okay so now I'm down 800 on the day and I was like, you know what? I'm going to call it a day here. Smart move. Hey, let's keep the losses small, right? $800 is no big deal and this is where things got bad. So then at that moment Dwac hits my scanner and it's moving and I'm like whoa Okay look at that.

so it was squeezing up and I was like you know what? what? I'm going to punch it I bought a th000 shares, it goes up another 20 cents or so I buy another thousand shares and I'm like all right this, this is moving up and then all of a sudden the spread opens up to like 50 cents a share and I'm down $1,000 on the bid and I'm like oh my God you know unbelievable what is going on. Try to put an order on the offer, can't get filled. the spread is huge, it dips another 20 cents and I'm like well so I got to sell I got to bail out I got to cut the loss. so I stop out of that I lose like 1,500 on it.

So now I'm down 2,300 on the day, then it and I kid you not it boun it goes like another 10 cents lower and then it curls right back up to my entry and goes up another nearly dollar a share and I was like unbelievable what do I do I got back in frustration. you know I just was like it's just that moment of like you know what, screw this buy buy buy buy buy and this time I bought 2,000 shares and then I double to 4,000 shares and then it drops a dollar a share. Again, basically the same as it had done before and I lost. You know, 3500 on that trade and now I'm down 6,000 on the day max loss.

It's it's really unacceptable. I mean it. I'm being hard on myself, but uh, I feel like it's unacceptable to lose that much on a that was this slow today had all the writing on the wall to be slow and I I pushed it right? So dumb. The days you want to push it are the days when things are hot and now when we get a hot day instead of being $6,000 a profit, it's just going to be digging me out of the hole from being an idiot on a day like today, so that's never fun.

It's disappointing. It's frustrating. So let's look at the charts. All right.

So that's how my day unfolded. Sitting down 6,000 bucks, up 300 on Bfrg, 55 on Ptpi, down 60 on Zva, down 1,200 on Roma the Chinese stock and down 5,000 on Dwac. This is just stupid. It's very stupid.

Uh I it I could be still holding. You know I could have given into ultimate frustration and just said, you know what? I'm going to keep holding and I'm going to keep adding and I'm glad I didn't do that. But look at Dwa first. So and you know it's just the the thing is, Dwac is a real piece of garbage.

Uh, and I'm not saying that just because I'm red on it. Uh, so 381 goes up to 2381. Go, You know? So right now you've got an 18 Cent spread 17 Cent spread. Um, seller right underneath the whole dollar of 24, right? It's right at Vwap.

it's probably going to flush and break through. So first of all, should I have even been trading the stock? No, No, no, Why? Well, number one, it's not even up 10% on the day, so it's really not up that much. I got I got sucked into a trade that was. you know it was the shiny Object syndrome.

It was moving I felt a bit of desperation to recoup my loss I thought oh, $20 stock? You know what? I I could probably get 50 cents a share on this. probably make $1,000 now. I'm trading my P&l not the market. Uh, right.

So all of a sudden you start to get into a little bit of tunnel vision and so I took my first trade on it. Um, it was actually right here that I took my first trade red dogee which is usually a reversal indicator and then it goes higher and so I was like, you know what? I'm going to get in. so I got in at 24 and I added at 2450. Uh, approximately 2449 and then it drops down here to 2350.

So I lose, you know, 70 cents a share? Whatever it was on 2,000 shares. then it comes right back up and I'm like Oh my my God So now as it comes back up 25 I had 2,000 shares at 25 and another 2,000 at like 2550 it goes to 25 70 2580 uh you know I'm green on the trade for a moment and then it flushes down to here it comes back up and I'm still holding and at this point I'm like okay please uh you know I'm like if this thing goes through 26, I will I promise I'll vote for Trump and then and then it comes back down here to 24 and I'm like God damn it. So anyways stopped out and and that's that. but you know it's just kind of emotional trading.

I got frustrated and you know I don't know what to say other than that I just I got frustrated I the loss on Roma just you know. Anyway, Anyways, it's a day where you're like take three trades, you're only up 250 bucks, three break even trades and then you get this one trade and now you're red on the day it's like I four steps forward and now I'm I'm down 800 on the day and then you see something start starting a rip and of course Dwac is a former Momo stock. So anyways I jump in, fall into the Trap and there's just not liquidity on it. You know the spreads are terrible getting in and out with 4,000 shares obviously I got slippage.

So just a stupid trade and you know $6,000 is a lot to lose in a cold market, right? It's going to take a while to make that back. Yesterday I was up 3,400 So now I'm down 2500 on the week and for a moment there you know when I was down8 00 or whatever it was uh I was like listen, you're still green on the week like who cares, right? Well you know, only for a second and then one trade on Dwac screwed that up. So let's look at Bfrg first. Um, this was my first trade of the day.

So this stock, oh my gosh, look at this look at that. It's so typical. um break outting breaking out of this consolidation that we get these traps. So typical.

So Bfrg um I bought this as it started to pull away right here and you know it was early. news came out and I was like okay I'll give it a try I got in on what was a 10-second pullback at 35 right here I got a little slippage on my entry, ends up going up to 54 and then pops up to 90 I took my profit off the table. Some sellers came in anyways, they walked it to back down and I didn't get back in. I was just like nah I'm I'm good on that.

So that was Bfrg $366 nothing exciting. Next trade was Zva. so Zva hits the scanner and was the leading Gainer for a few minutes there. um I jumped in as it broke over a dollar.

ends up actually sorry on this. um where where was it? It breaks over a dollar I got a couple trades on this I also traded in the small account but I'm not going to go over that in this episode. Um so micro pullback right here at A111 uh another micro pull back here to18 I did the one at Dollar like 18. Anyway, it didn't really hold up so took a loss on that.

60 bucks and then Roma comes up on the scanner first it pops up here to 474 and I was like no I don't trust it I'm not going to trade this. this is too choppy, drops down and then it rips up and it halts up and I was like man. All right. So on resumption I was like okay, well you know what? um let's see maybe I could I could do a dip and a rip.

So on resumption I get in like right here for the break over 511. Uh, it comes up to 5'11 right here and it can't break so there's like a hidden seller. So I was like you know what? I'm just going to get out. So I got out into this red candle, then it halts down, it opens lower and I tried to do a dip.

Was it right? I did a dip in this area here. um and you know it did curl up a little bit but but nothing really that exciting anyways. just a garbage trade I mean just terrible price action. but you know, look this is right now.

it's slow. So one of the things things that I'll say is that in my experience, about 80% of my profit of the year will come from 20% of the trading days. The problem is that requires the discipline to be patient. 80% of the time, more or less.

And today's a day where I wasn't patient. That was the problem I wasn't patient I got frustrated that the market was so slow I just got annoyed I let my emotions get the best of me. and then next thing you know, I'm punching the order for 4,000 shares of Dwac. It's a $25 stock and I lose nearly a dollar a share on it.

It can happen so fast. You know this. This is the thing I Suppose with trading is that it's important to set intentions. It's important to keep this stuff as much as you can in the front of your mind, but it's also important to forgive yourself and to be resilient and get back on the horse.

because you will fall down. You will have losses. In fact, if you are not falling down, you're not pushing yourself hard enough. You have to take risk, right? trading If Look, you're never going to take a loss if you're investing in treasuries.

well as long as You hold them until they're maturity. So like if you really never want to lose, then you're going to have to bring your you know potential profit way way way way down. So if you want the potential profit, you've got to take the risk. And today's a day where you know Yeah, I took the risk.

but I Also, um you know I made some mistakes in the heightened emotional state that happen happens when you're trading and I have to let myself, you know, forgive myself for that at a certain point and be like, you know what? I'm grateful that you stopped where you did I'm grateful you stopped at a $6,000 loss and didn't go to down to 12 or 15 or 20 right? Could have been worse. Um, and and that by itself is maybe the only Victory I have today. But that is a victory because in the past I've had days where I spiraled and it got really really bad. So knowing at some point that okay at this point I really have to throw in at the towel.

It's good to have that Line in the Sand um I just wish I had done it when I was down 800 like I kind of said I was going to and then well you know. next thing you know I took a couple more trades so uh anyways yeah I'm I'm I'm certainly disappointed it's not. It's not that fun to have a red day like like this, but um I I have to just be really disciplined in the upcoming days. Now the thing is, my my fuse is going to be order tomorrow.

right? If tomorrow, my first trade is is red I'm going to I'm going to immediately be like grinding my teeth I'm going to be really frustrated. so you know because I don't want to capitulate I don't want to, you know, have a multi-day red streak. It's early in the year I Want to build my cushion? Come on, let's get things going. but we're in a cold cycle right now.

This is probably the coldest January I've seen in in maybe years. Um, not for any particular reason. I mean it's just it's the way it's the luck of the drop raw but it is cold. Uh, some penny stocks have been in play Phun yesterday.

you know, whatever. mimo today I but I'm not a penny stock Trader my I you know I for one thing I do not. It cost me so much in commissions to trade at this price range. I would spend thousands of dollars in commissions because the broker that I use does charge commissions.

This is a these are great stocks for people who are with TDM a trade and Robin Hood whatever. Uh, and right now they are popular. This is what people are focused on so you know that's that's what's got the attention Roma Just horrible and you know what? So Ela G from yesterday no uh oh what now? no um I'm so I I forget the tickers so quickly. um anyways I guess doesn't matter.

but the one from yesterday, um I thought it was El lag but I think obviously it's not. Um, the one from yesterday was so bad it hit a 52. we high and then it hit a 52. we low in one day.

That is pretty crazy. So yes, we're in a cold cycle and you just try. Got to try to keep your head up. So I guess big picture is you know, green on the month green last week down 2500 on the week right now.

um, still you know we've got two days left. So I suppose at this point, if I can close the week flat, that would be a monetary goal. But more important than that because that can get me fixated on the money is if I can, um, stop the spiral. So I just had.

basically you know, three red trades in a row. two of which were spiraling trades. You know, the Roma trade. Whatever, that's just a losses.

it happens. But then the two two trades on Dwac terrible spiraling trades. Emotional bad. So I need to begin tomorrow with you know, sort of turning around at least from the emotional perspective of taking good quality setups.

It's tough man. I mean this. Look, trading is hard. I've been doing this for a long time and although it's easier for me now than it was when I got started, it doesn't mean it's easy, it's still difficult.

It just challenges you in a different way. as you gain more experience. You you know some of it is expectations. You know you, you have a stretch of doing really well years, whatever it is.

and then when things get slow, you are holding yourself to this really high standard which is maybe difficult to achieve and you beat yourself up. Or you know there's just the type of emotions that you deal with as a seasoned experience Trader are different, but the emotional pressure is still there and so ultimately, what's your coping skill for dealing with this kind of emotional pressure? Mine has not been great I I guess and some ways I don't know I'm going to be hard on myself today because it's a red day I'm always hard on myself on a red day. so um, you know I I would I would feel like mine isn't as good as it could be because I still have days like today, even after trading for as long as I've been trading more than a decade. But then on the other hand I have to remind myself that look, you know this is part of the this is part of the deal.

Everyone has days like today. you just it's important to acknowledge them, it's important and this these Recaps hold me accountable cuz now I'm talking about it. So it makes me very aware of what I just did so in the moment right now at this moment I'm no longer in the emotional spiral. you know, like my I've kind of brought back the logic and I'm like, yep, that was stupid.

Whoa. Okay, what was I doing back there? That was wild which is important because you've got to sort of snap out of that tunnel vision. Uh, so you know this is part of the process for me doing these Recaps kind of helps me compartmentalize like okay, that was what happened. All right.

Put that aside Now New day. This is the new Focus tomorrow. Consistency High quality setups. Be patient and do some meditation just to really breathe on being patient.

It's okay to take no trades tomorrow. It's okay. if the market is slow for a couple more days or another week, it doesn't It's fine. It doesn't matter because when it is hot and it will get hot when we have the day where we have a stock that's going up 300, 400, 500% and it's within my price range, that's the day I Need to dig deep.

That's the day I need to really lean in. That's going to be the 20% right? That's the day that's going to contribute possibly my whole month of profit and all the other days in between are just kind of like chipping away. chipping away, chipping away something that I think is interesting. Um, with short sellers, especially the short sellers that are shorting every pop, shorting every pop, shorting every pop.

uh, and especially short sellers who are averaging, that's a strategy where you keep adding, you keep adding, you keep adding, and then you get the reversal. You keep adding, you keep adding, you keep adding, and then you get the reversal I Feel like that's something that works more like the 80% of the time. And then it's the 20% of the time where you have the stock that goes. You know Higher and Higher and Higher and Higher and Higher And so what I often see in terms of the equity curve of those short sellers is like steady steady progress and then huge drop Steady steady progress and then huge drop.

And you know if they're good, they're still net positive in spite of those drops. I Guess my P&l tends to be a little bit more kind of like slow a a slower Ascension Just sort of slow like you know, up and then down. up and then down. up and then down and then boom Big Green Day and then I hold the I Try to hold the level of that big green day and then it's again.

Base hit base hit base hit Bas H Green Day base H base H base H Bas It big green day. So it's a little bit different. Um, but for me in terms of managing risk and preventing the Black Swan event of shorting a stock and it going up to 500 and losing, you know everything that I've made I obviously prefer I and Tra to trade to the long side even if it means sometimes I'm making a little bit less money. Um, you know that's the thing with risk tolerance.

If your risk tolerance is lower, you'll make less money and mine's a little bit lower and it's lower than it used to be because is I have now made money when you're at the beginning of your career and I see this sometimes with brand new Traders there's a bit of like I've got nothing to lose like I there's a little bit more gunslinging and taking Yolo High high-risk trades maybe to prove themselves are just like hey, if this works like I'm good but then once you've achieved a lot, once you've made $10 million like I have trading and as always my results are not typical then you start to sort of change your risk appetite. You know now it's like okay I'm not GNA roll the whole 10 million into a trade and be the guy who made 10 million and went back to zero. Some people would do that and be like hey I don't care if I go back to zero maybe I'll go to 100 million but I'm not that kind of person so you know for me as I've gained more experience and as my account has grown and as I've gained wealth, my risk tolerance has gotten lower and lower and lower now. I Still day trade every day.

but you know myp tolerance to trade some of the highest risk stocks or to short stocks has just gone down. And to clarify for a moment, um, someone said yesterday Russ you're trading in a retirement account but in 401K accounts when you take the money out at retirement, you pay income tax on it and that's correct. but I'm not trading on a 401K I'm trading in a Roth IRA So when I started my small account challenge in 2017, I started with $583 and15 I think it was and then I grew that account in the first year to 335,000 and I took 6,000 of that and I deposited it into a traditional IRA and then the next year I did another $6,000 contribution from 2018 profit and then in 2019 I did another $6,000 contribution. So I contributed a total of $18,000 into traditional IRA.

Then I converted it from a traditional IRA to a Roth IRA When I converted it, I had to pay income tax on $188,000 whatever that's called tax, the seed, not the tree. I paid my tax on the $188,000 and now because it's an Roth IRA everything that grows from that account is growing tax-free because it's in the Roth IRA But the withdrawals at retirement age are also tax-free Now it's possible that I'll be forced to make withdrawals and they'll change the rules. There have been. you know, some talk about changing the rules with IAS and you know, not allowing people to accumulate tens of millions or hundreds of millions or billions of dollars which some people have actually done in a Roth IRA But you know, so maybe they'll change the rules and prevent uh, some stuff with that in the future.

But nonetheless, um I I have all that money in my Roth IRA but I only have about $100,000 in the Roth IRA that I use for day trading. So my day trading count is small and the rest of the money I put into the market long term now I could do other things with it I could buy real estate. Um, you know you, you could invest in businesses. Uh, this fellow I can't remember his name Peter or something or maybe someone else.

Anyways, he was an investor in Facebook and he invested in his Roth IRA and that's how he accumulated like A4 billion doll Roth IRA So you know you could invest in um, startups and things like that. Anyways, this a little a tangent, but just to just to mention it for others that may have been confused because I saw that comment um and I've seen it from other people who are like wait, I don't get how it's tax-free You know, you know, how's that work and doesn't that mean you can't take the money out right now? And it does mean I can't take the money out right now unless I'm willing to pay a penalty and income tax on it. now. Right now, my income tax bracket is high because I have been making a lot of money I make money on YouTube Not a lot, but I make a little bit I make money from my book.

By the way, if you haven't checked it out, you're welcome to it's a best seller on Amazon Again, not a lot, but a little bit. Make some money on that and it Mak some money on at Warrior right? So you know I do all these different things and I earn a little bit of money from these things and and that's great. The thing that I think is really incredible about trading is you can work full-time trading and all of that profit can be in a retirement account. Tax-free when I write a book.

There's no way to make this income taxfree when I you know have YouTube ads. There's no way to make that income taxfree. It's not possible I own some real estate and I have rental income that comes in from that. You know you can.

Yeah, you have some offsets with depreciation and things like that, which is great and we use that. but but aside from that, you know you can't really make it entirely taxfree, but trading profit, you can. So I Love trading as essentially like, almost as a side hustle even though it's been my full-time thing almost as a side hustle because I don't spend the money that I'm making from Trading Now that's not true for the small account, the small account is a taxable account, but for my main account, all of that Profit just gets tucked away tucked away tucked away for later. So it is essentially my retirement plan in a way.

And then you know if at some point I feel like oh, I really need some money from that account. Um, then my assumption is that at that point my income bracket will be lower. So if I have to pay the 10% penalty, you know, not great and pay income tax Also, not great. But if my income bracket is lower, it won't be the end of the world.

So that was kind of my thinking with it. Um, you know there. there were a couple years where early on I was trading just in my taxable account because my IRA was too small and then I got to a point where I was doing like half and half and you know one of those years I owed millions of dollars in income tax and I was like oh my God this is insane. It's crazy, you know what? and I was like I got to this is this is just ridiculous I it's you know it just doesn't make sense.

So I'm making the decision to live a little bit more frugally right now so I can save more aggressively for later. And my belief is that and I know this that that will pay dividends. And and here's here's a kind of cool thing. So my son actually both my kids um got a $100 bill uh in a Christmas card this year from their great uh, aunt and so that was very nice and um you know $100 for little kids is a lot of money anyways and my son says let's put it in the bank so it grows I was like yes I love that he's like if we put in this bank then it there'll be more later right? I was like that's exactly right now you know of course there's a South Park episode of like Investing and it's gone, but this is and it's not going to grow very quickly.

But I you know and and look I I Also acknowledge that life is short and I'm not telling everyone to live the way I live, do what you want. uh I don't want to guilt trip you if you like spending money and doing things I spend money too. but you know at the same time it's just finding the balance and I'm definitely on the more frugal side of that balance. but um, you know that's the way I was raised and that's kind of the way I think about things.

So yeah. so I just kind of let that money in the in the retirement account just grow and grow and grow. And you know I leave it in the market and statistically and historically, it should return and do well if at some point I want to take that out and buy buy real estate with it something more physical I could do that if I wanted to buy gold with it I could do that too. You know you could do a lot of different things with a Roth IRA depending on who your custodian is.

but um, yeah. so anyways, a little bit of a tangent there. but uh, so today is a red Day red Day recap. but I'm already over it.

You know it doesn't matter, it's it's a red day. It's watered under the bridge and I never want to get more, been out of shape or frustrated. You know, like look this day I will have totally forgotten about it. probably 3 days from now, 3 days from now a month from now.

I'm not even going to remember today. Do you think I remember the first Max L red day I had in 2023 I don't I really don't I don't even really remember I guess I sort of remember my worst day of 2023 because it happened in December Um, but it wasn't even that bad of a loss. So like the thing is, as long as I can keep my losses relatively small, they're easy to recover from. I I Don't get that bass shape about it.

It's like, all right, Yeah, it was stupid. it was a mistake, but you know, whatever, you got to take risk and sometimes it pays off. So that's life. I Don't want to totally disregard the opportunity to learn a lesson from a loss.

but uh, but beyond that, it's like, okay, let's move on. and if I'm going to have totally forgotten about the trade a week from now, it's not worth spending another minute stressing about it. just basically mentally already put myself one week ahead where I've forgotten about it and life is life is good. Move on.

All right. So those are my uh, words of wisdom. Reminder is always trading is risky. My results aren't typical.

Uh, thanks as always for tuning in and I'll see you guys back at it first thing tomorrow morning.