A stock trader who returned 630% in 3 years and taught traders who became millionaires shares the top 3 patterns he plays daily
But not everyone becomes a millionaire from trading. Sykes says most traders lose for various reasons, including lack of preparation, trading without sticking to rules, overtrading, leverage, and large position sizing. He's also not sure what percentage of his students become successful. He compares his program to a gym membership, where the majority of those who sign up don't succeed or follow through.People think there's an exact formula or a list of hot stocks to trade.
He also scans for breaking news before the market opens. The watchlist could be between 10 to 15 stocks. In 2020 and 2021, that list was up to 30 stocks because the market was volatile and there were many stocks that rallied. He also shares his list with his students but it's up to them to determine the stocks and setups to trade based on whether they prefer to short or long..
While Sykes will trade any stock that fits his setup, his preferred sweet spot is stocks that are trading between $2 to $4 a share. Anything below that range increases the risk because it's more speculative, he said. Stocks trading above that range have institutional traders, which makes pattern prediction trickier because you're betting against algorithms and more sophisticated traders who Sykes doesn't want to compete with.
Unlike many traders who add to a winning position, Sykes prefers to scale out of a winning trade. He calls it"trading scared" and admits he has missed out on more gains by exiting early but prefers the safe approach. The company went bankrupt and Sykes shut his fund down in 2007. That same year, he was featured on"Wall Street Warriors," a TV series that followed the lives of fund managers and traders.
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