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Trading Education Begins

Read my last post here to get up to speed on my new game plan and direction.  I took a hard look at my success, or lack thereof, and redirected myself to better align with my goal of full-time self-employment by the end of  2018.  There is way too much to review here so you will need to go read it if you want to understand the drastic change in my trading.  Basically I know I need a trading education, so I have begun a course!

Pre-Education Trades

Here is a look at my trading account, where the majority of my losses have come.  You can see I am holding many losing positions that I have held way too long.  Take a look at the right hand side of the table.  These losses are not helping accomplish anything.  The account value dropped all the way to $15,300 at it’s lowest point.

Please feel free to browse my previous blog post to read all about these trades.  Here is the only trade I had not yet discussed:

HIPH, is another weed stock.  They are currently producing a sports heath drink that contains CBD (cannibus oil) and has been endorsed by Ice Cube himself.  The company was being promoted by a Twitter account that is providing free penny stock picks.  They were also promoting the fact that their success rate was better than 90%, with only one loser since beginning the free service a few months earlier.

I have decided not to share that Twitter handle because I don’t trust them.  They might be legit but I have no way of knowing.

The trade:

After seeing the alert on Twitter on 8/8/18 I purchased 72,000 shares of HIPH for $0.0131 each.  The total cost was $948.15.

Education Begins, Cash Needed

I did pay for my educational materials, and for copyright and ethical reasons I can’t share the information from that material here.  Tim Sykes’ business is selling trading education, posting it for free would be wrong.  I will, however, share the new rules I created from Tim’s teachings.  The first thing I needed to do was free up some cash from all the trades that weren’t serving me well.  Without cash I can’t trade.

On 8/21 I sold the shares of HIPH from 8/8 for $0.0135 each.  Total sale was $960.58, a profit of $12.43, about 1.3%.

I had no reason to believe this was a good trade with a positive upside, so I sold them.  The price did rise more than 100% in the days following but since there was no indication, I have no regrets.  I need to focus on trading profitably, not buying lottery tickets.

On 8/22 I sold 120 shares of Lowe’s that had been purchased in 1999 for $14.23 per share, the total cost was $1,707.60.  They sold for $106.76 each after a good earnings report; total sale was $12,805.07, a profit of $11,097.47, about 650%.  Now that I had a plan, it was time to liquidate this position and eliminate any excuses for not selling.  I knew when I sold this one there would be a tax bill, but now I have no tax bill excuse.

On 8/27 I sold my position in RIOT for $5.78 per share.  I waited a few days to sell because it was on the rise following Bitcoin’s lead.  Once it started to turn back I sold, the total sale was $3,751.92, a loss of $1,865.47, about 33%.

Trading the Charts

As I began my new chapter I decided to stick with the stocks I knew and trade the charts, not the companies.  You invest in companies, you trade charts.  I will only trade stocks that show a good technical chart that has promising short terms gains.

8/23 I bought 400 shares of MU for $50 each, total cost $20,004.95.
I sold these shares on 8/24 for $50.24 each, total sale was $20,134.73, a profit of $134.73, about 0.7%.  After this stock showed signs of an upward move it reversed direction.  I sold out to preserve my profits.

8/28 I bought 120 shares of WWE, yes professional wrestling.  It was the trade of the week from Trade Ideas and was moving toward all time highs.  The shares were $82.83 each, a total cost of $9,945.57.  This trade worked well and I watched for several days as it moved upwards with a moving average or MA.  Once it dropped below that moving average I set a stop-loss order.  It continued downward and on 8/30 I sold for $85.97 per share.  The total sale was $10,311.30, a profit of $365.73, about 3.7%.

On 8/28, as weed stocks continued to rise I bought 500 shares of ZYNE for $6.80 to try and capitalize on this.  This stock was making an upward move after bouncing off support.  I sold it the next day for $7.13 per share, total sale was $3,558.94, a profit of $153.99 about 4.5%.  This stock is currently trading above $8 per share but I have no regrets as I took a solid profit and didn’t get greedy.

Long Hold: Cash Out a Loss

On 8/29 I sold the last 30,000 shares of SGMD the stock that gave me a $5,000+ profit last year.  I realized there was no guarantee of future movement and they put out a press release describing their plan to dilute their shares.  You can read about the dilution here.  The shares sold for $0.13 each, the total from all SGMD shares sold this month was $5,645.14, a loss of $427.41 about 7%.  This stock just didn’t fit with my strategy; they needed to go.

On 8/29 I bought back into MU because it seemed to be continuing an upward trend which I had already profited from in the same week.  I bought 388 shares for $51.55 each, total cost $20,005.30.  I sold these the next day for $52.51 each, total sale was $20,368.61, a profit of $363.31 about 1.8%.

TSLA, one of my favorite stocks, was making an upward move right after I sold those shares of MU.  I went ahead and bought 66 shares for $301.45 each, total cost $19,900.53.  The price rose but quickly reversed, I sold before it moved me into negative territory.  Sold for $302 per share, a profit of $26.25 about 0.1%.

The last trade I am still holding but have a stop in place near $5.  GOL, a brazilian airline was making an upward move after bouncing off support.  On 8/29 I bought 911 shares for $5.48 each.  At writing I am still holding these shares, they closed at $5.52 on 8/31.  As of right now I have a small profit.

Final Notes and Thoughts

Additional income, expenses and contributions:

I recieved a dividend from LOW stock on 8/8 for $57.60.
$760 was added from side hustling during the month of August.
I made $400 in contributions from my paychecks during August.
E*Trade charged me $81.88 in interest for using my margin account.

You may be asking yourself what is technical analysis?  What on earth are you talking about?  What is “bouncing off support?”  I will explain all in an upcoming blog post so subscribe to this blog below to keep learning!  I want to first prove there are profits to be made using technical analysis, then explain it.  You will want to learn after you see me making money using these techniques.

Thanks for reading and happy trading!

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