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How to Start Day Trading with $1,000 💥NEW Small Account Challenge Ep. 1

Ross Cameron - Warrior Trading・54 minutes read

The text discusses a small account day trading challenge starting with $1,000, using specific strategies, tools like scanners, and stock selection criteria to aim for daily profits of $100 to $200. Emphasizing the importance of discipline, the speaker reflects on a trade mistake while sharing insights and tips on successful day trading techniques.

Insights

  • Utilizing leverage in day trading allows for increased buying power and potential profits, emphasizing the importance of careful stock selection and risk management.
  • Successful day trading strategies involve finding trending stocks, using specific criteria for stock selection, and maintaining discipline to avoid emotional trading decisions that can lead to significant losses.

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Recent questions

  • How can leverage impact day trading?

    Leverage allows traders to control larger positions with a smaller amount of capital, increasing potential profits but also amplifying potential losses.

  • What are key criteria for selecting stocks in day trading?

    Stocks moving quickly, up at least 10%, with high relative volume, breaking news, and low float are essential criteria for identifying potential trades.

  • What is the significance of emotional discipline in day trading?

    Emotional discipline is crucial in day trading to prevent impulsive decisions that can lead to significant losses, emphasizing the importance of sticking to a trading plan.

  • How does the first pullback pattern work in day trading?

    The first pullback pattern involves buying the first candle that makes a new high after a stock makes a strong move up, with tight stops at the low of the last pullback.

  • Why is monitoring level two post-trade important in day trading?

    Monitoring level two post-trade is crucial for assessing strength or weakness through order flow and price movement, providing insights into market dynamics for informed decision-making.

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Summary

00:00

"Small Account Day Trading Challenge Strategy"

  • The individual is embarking on a small account challenge for day trading, starting on day one.
  • The strategy involves using scanners to identify potential trades, aiming for a specific entry point.
  • Ground rules for the challenge include using minimal equipment - an old laptop and a broken monitor.
  • The account is funded with $1,000, utilizing international brokers for leverage and trading limitations.
  • Leverage allows for a buying power of $6,000, enabling the purchase of up to 1,000 shares of a $6 stock.
  • The strategy focuses on stocks between $5 and $7, with specific rules on leverage and stock selection.
  • The trading strategy for the small account challenge differs from the main account, emphasizing caution due to limited margin for error.
  • The approach involves finding trending stocks, buying the first pullback with a tight stop, and aiming for $100 to $200 profit per day.
  • Detailed criteria for stock selection include stocks moving quickly, up at least 10%, with high relative volume and breaking news.
  • The importance of stock float, representing supply, is highlighted for identifying potential high-demand stocks for significant moves.

14:38

"Profitable Day Trading Strategies with Stock Scanners"

  • Trading low float stocks can be profitable despite risks and volatility.
  • Members at Warrior trading have found success trading small cap volatile stocks.
  • Utilizing stock scanners to find potential big movers is crucial for successful trading.
  • Developing stock scanners with specific criteria helps filter out noise and identify potential trades.
  • Having the right tools, like stock scanners, is essential for successful day trading.
  • Workflow involves finding the leading gainer, checking news, and identifying favorite chart patterns.
  • A pullback pattern involves a stock making a strong move up and then pulling back, with key levels not to be broken.
  • Entry on the pullback pattern is buying the first candle that makes a new high.
  • Anticipating breaks in stock prices can lead to losses if not confirmed by actual price movements.
  • Emotional trading decisions can lead to significant losses, emphasizing the importance of discipline in trading.

28:58

"Trading Strategies for Breakouts and Pullbacks"

  • The trader reflects on a recent trade, acknowledging a minor mistake in not cutting losses at $6.80 and letting it go 30 cents against them.
  • The ideal scenario for the trade is a breakout above a certain level leading to new highs.
  • Entry for buying pullbacks involves waiting for the first candle to make a new high, known as the Apex Point.
  • Early entries are preferred to anticipate breakouts, often triggered by psychological resistance or level two activity.
  • Immediate price movement after entry is crucial; if it moves down, the timing is wrong, prompting a decision to hold with a stop or cut losses.
  • The target for this trade type is a retest of the high of the day, aiming for a move back up to that level.
  • The first pullback pattern is considered a lower-risk setup with tight stops at the low of the last pullback.
  • Profit targets for this pattern range from 10 to 20 cents, with the possibility of higher gains if the trade goes well.
  • In a strong market, adding to a position rather than selling a partial one may be considered.
  • Monitoring the level two, or depth of the market, post-trade is crucial for assessing strength or weakness through order flow and price movement.

42:55

"Stock Trading Tips for Success"

  • The stock price increased from $4 to $6 to $8, showing a continuous upward trend.
  • Buying stocks during a pullback is recommended to reduce risk.
  • The speaker started trading as a teenager and authored a book titled "How to Day Trade the Plain Truth."
  • The speaker emphasizes the importance of starting to learn how to trade immediately.
  • Different brokers have varying rules, such as restrictions on trading stocks under $5.
  • The speaker engages in a small account challenge to inspire and motivate others.
  • The speaker focuses on trading the right stocks to increase success rates.
  • The speaker shares a trading example where they made a mistake by buying during a false halt.
  • Despite facing challenges, the speaker managed to make $412 on the first day of the small account challenge.
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