Developing My Own Method
After the market crashed, I tried getting my clients back into trading, thinking everything would be as they were. I was wrong! For the next year, I was battling with a raging beast. The stock market was taking no prisoners. I lost clients’ money and there were even instances when they were down by 80%. This was really bad and I knew it. I had to do something. I went to my local library and started studying every stock market book I could find. Yes, I had an MBA, but I didn’t have any knowledge of market cycles.
I read everything, including historical market cycles, Peter Lynch and the like. The only book that really spoke to me was “How to Make Money in Stocks” written by William O’Neil. When it came to explaining the gyrations of the stock market, he nailed it. He used actual facts, research and more importantly, he used charts. A light bulb lit in my brain, I knew what I had to do. It’s what helped me to get all of my clientele out of the market in 2001 and save my business. My childhood flame for charts had been reignited.
Sadly, my colleagues were dropping like flies all around me. Within two years, 90% of the traders I worked with were washed out.
Why had I made the cut? Because I had a financial bible, “How to Make Money in Stocks”. All I had to do was read this book and be patient. O’Neil had laid out the perfect trading system – it was the stock market’s version of the Phil Jackson’s Triangle Offense.
In 2003, a new bull market emerged. By this time, I felt more confident and began to inch my way back into stocks. This time, I’d use O’Neil’s system. A few months had passed and I was making my clients money…it was really working.
I decided that it was time to do a bit of trading for myself, so I applied what I had learned for my own personal accounts. There was great success, which lead me to thinking about dropping out of representing clients and focus on managing my own money. At least this way I could earn a lot more money with less stress of worrying about someone else’s wallet.
The more I used the system, the clearer it became that I could purchase tons of stock on the exact volume breakout day, using leverage, at a certain buy point, then sell the stock the very same day or the following day, once it’s made its first move. This exact method has earned me lots of money over the years. I’ve played around with this technique, refining and mastering it to near perfection.
What I did was this, I took the roots from O’Neil’s playbook and made the sell and buy points more accurate. Finally, I had a list of my own set of rules added to O’Neil’s. The difference was that the method could be used for short-term trading. I rarely, if ever, keep stocks overnight. This means that I don’t ever have to dread waking up to a bad market because something happened across the globe while I was asleep. I have to say, I sleep a lot better these days!
My sole purpose for creating www.EZBreakouts.com is to give you the chance to learn what I know and utilize them daily when trading stocks. Make sure to check it out for yourself.
To conclude, I wish you great success in making money in day trading.