Brief Summary
Ross Cameron from Warrior Trading shares the simplest day trading strategy for beginner traders. The strategy focuses on trading leading percentage gainers and gappers each day. He uses a real-life example of a stock, PIK, that went up 200% due to a partnership deal with Walt Disney. He explains how to find these stocks using scanners and the importance of understanding the imbalance between supply and demand. He also touches upon finding safe entry points, emphasizing the importance of not over-trading and building consistency.
- Focus on leading percentage gainers and gappers.
- Use scanners to find stocks with catalysts.
- Understand supply and demand imbalance.
- Find safe entry points and avoid over-trading.
Intro
Ross Cameron from Warrior Trading introduces a simple day trading strategy for beginners. The goal is to take one or two trades a day, minimizing risk and maximizing potential gain. Even with a 50% accuracy rate, this approach can lead to profit. He stresses the importance of keeping it simple and focusing on leading percentage gainers each day. He will show how to find these stocks, assess their potential, and discuss entry points.
The Simplest Strategy
The simplest strategy involves focusing on the leading percentage gainers each day. A stock he traded, PIK, went up 200%, and capturing even small pieces of such a move can result in significant profit. Trading stocks with narrow ranges often leads to an inverted profit/loss ratio and poor accuracy. It's best to focus on percentage gainers and gappers. This is a gap strategy focusing on leading gappers and gainers each day.
Live Example
Ross shares a live example where he made over $13,700 on PIK, a stock up 180%. The stock surged due to news of a partnership deal with Walt Disney. This strategy is called the "gap and go" strategy, where a stock opens higher than its previous close due to breaking news. Trading such stocks, which can go up 100% or 200% in a day, allows even small gains to translate into substantial profits. Unlike trading stocks like Facebook with minimal movement, volatile stocks offer better profit potential for beginner traders.
How to Find the Stocks
Ross uses a scanner to find stocks that are moving in real-time. The scanner helps him find stocks like PIK and TCAT. He programmed this tool to identify stocks moving up quickly and those with a catalyst. For stocks to make a big move, there needs to be an imbalance between supply and demand. Demand is fueled by news like the Disney partnership, lower stock prices (under $20), and a lower market cap represented by the float. PIK, for example, had a low float of 7.6 million shares, creating an explosive opportunity due to high demand and low supply.
How to Find an Entry
Finding the right stock isn't enough; you need to dial in your entries. A safe entry point for beginners is the first pullback, such as a five-minute pullback at the volume-weighted average price (VWAP) and the nine moving average. The first candle to make a new high after the pullback is the entry point. While some traders might trade a stock like this multiple times a day, it's important for beginners to recognize that less is more and avoid over-trading. Aim for one good trade a day to build consistency and confidence.
Closing
Ross summarizes that focusing on the leading percentage gainer each day is one of the simplest strategies to find the right type of stock to trade. The next step is to find exact entries. He encourages viewers to tune in to his morning show to see his entries and to subscribe to the channel. He also mentions Warrior Trading for those who want to watch his live trading archives and full trading sessions.
