Marek Liyanage

>200mi, more like 4hrs...impressive dedication...maybe LA or SD meetup too next time it comes up man!

"I'm using the strategy of small account, small risk, small shares. But I'm starting to see your point of the danger of account blowup. I have days where my patience is tested, and it gets harder to stay in control at those times." The small account will protect you from larger losses...it's better to serially blow up a smaller account 2-3 times than blowing up a larger account one time. Overall I think you will learn more in a shorter amount of time too...

$AMZN and $INTC offered great break out setups in after market today after their earnings release. Check out the extended hour charts when you get a chance.

Today was a red hot day of earnings reporting after the market close....Tesla (TSLA), Microsoft (MSFT), Paypal (PYPL), Ebay (EBAY), Xilinx (XLNX), Service Now (NOW), Las Vegas Sands (LVS), Spirit Airlines (SAVE), Netgear (NTGR), Ford (F). I traded TSLA and PYPL in after hours...PYPL was great and offered a very tradable setup to the long side, moving $10 from 96ish at the close to 106ish the after hours high - that's a 10% move right there. Tesla (TSLA) totally knocked it out of the park moving >$50 from 255ish to 308ish the after hours high....representing a >20% move and a very tradeable setup. Tesla popped around 1:50ish...the time of the release so I had charts pulled up and ready to roll. It spiked $30 in 3minutes!!! I got my alert of Tesla's earnings beat via Benzinga's Squawk box...so was primed for the pop based on the huge earnings beat that was reported via the squawk. Not every day is good watching stocks moving in after hours but the good ones like today make the extra hour of work right after the market close very worth while.

ROKU was another example of a great breakout today in after hours on news of analyst upgrades to 130 and 155. Many of us in the chatroom watched and traded it during market hours and this would have been another nice move to catch. Someone asked about after hours volume in the chat. It's much lower than during regular hours but what matter more than absolute volume is relative volume and whether you can identify a nice trend in a stock gapping up or down and then also the spread. The spread tends to be bigger outside regular market hours so you need to gauge the spread relative to how much and how fast the stock price is moving in the direction you plan to trade. In some cases the spread will be large and you may skip the trade entirely bc of it but many times as was the case with ROKU 0.1-0.17 is fine when a stock is moving $1-$2 in a few minutes. I find trading after hours to be a lot less intrusive with my trading routine than in pre market. The main reason being that in pre market I am really only doing research so getting into a position becomes a distraction and interferes with me completing my watch list. I have also found better the price action and trends to be cleaner in after hours when a strong news catalyst moves a stock.

Here's a preview of the bigger companies that begin to report next week from Earnings Whispers. I am not sure which ones report in after market but I will be keeping my eyes peeled for NFLX, GS, WF, C, JNJ, JPM, BAC, MS, CO and AXP the first week. Reporting this upcoming week includes a lot of banks and financial institutions. Then it continues the weeks after with a host of other big companies reporting.... Earnings are a major catalyst, one that returns 4x a year for each and every company that you can count on so it's worth prepping more for these events on select companies. Not every one is worth the time/effort but those that garner high interest and historically high trading volume before and after earnings as well as provide some history of predictable earnings moves are definitely well worth it. Keep in mind, same as with watchlists, not every one you put on watch will end up presenting a good trade but the only way to capitalize on the first big move is to be ready to go at the time of the release. And yes, it's a whole lotta fun too!

Here's two examples of breakouts in after hours....today BBBY gapped up 12.5% and PCG broke down almost 20% this afternoon. These are both very tradeable setups. In the case of BBBY the break up was triggered by news of a CEO change and for PCG a CA judge issued a ruling that is very unfavorable to the company re. the restructuring plan. Unfortunately I got back to the trade station a bit late so was not able to catch them. But these ones, I will always take. You could either scalp these moves or partial and hold some for an hour or so, or maybe even over night if you think these are good trades to swing depending on your style of trading. I am mostly a momentum trader/scalper so prefer to be all out at the end of the day so usually would try to scalp 50-60% of this kind of move in the first 1-4 minutes of the break up pr down. That's about $1.5 of a move captured....and a very tradeable patterns if you already have experience trading 1-5min ORBs at the market open. Note the catalyst is not earnings but really it doesn't matter, whenever your core trading hours are you always need to be ready. The first thing I do when the market closes is pull up the Trade-Ideas after hours scanners. These are tuned to pick up gappers and high volume trading in after hours. Just open the channel bar and click on "After hours" to pull up this scanner. The stronger earnings movers will always pop up on these scanners too. And that's how I was alerted to BBBY and PCG when I returned to my station. I then went on to check the news in my Benzinga feed to find out what the news catalyst was. A good scanner and news feed can be very helpful teasing out what and how strong the news catalyst is that's driving the move in stock price. If you have a knack for trading ORBs at the open and have an hour after the close time, start by making it a habit of hanging around for 30-60minutes and opening up the TI scanner and checking charts of the companies reporting that day in after hours. Even better with the Benzinga squawk or feed to give you a heads up on surprise beats or misses. Always, trade smaller size than you usually would when starting out...until you get more comfortable with trading in after hours.

I switched from the AOC to the higher resolution 1920x1080 Lepow monitors on my laptop travel rig. Initially, bc different resolutions on laptop screen and travel monitor cause an issue scaling windows (e.g. in DAS and other programs) that make it difficult to work with the same program across multiple screens. Well, not only is the resolution problem fixed but the Lepow monitors are a lot lighter, less bulky and there's no more power issue that can sometimes cause flickering of the screens using the USB-C and/or HDMI+USB-C(power) ports supplied on Lepows monitor. USB-C ports can support higher voltage and supply more juice than regular USB-A or -B ports so if your laptop has one, this might be an option. The Lepow monitor does not have a regular USB-A or -B port. I picked them up after reading all the rave reviews on Amazon. They are on par for price as the ASUS screens.

Last week's setups for trading earnings breakouts in after hours were not great. The ones I was watching around 4pm were SFIX on Tuesday, BBBY on Wednesday and COST on Thursday. All 3 chopped up and down with no clear trend to justify a trade. I usually have 1 and 5min charts pulled up and ready to go a few minutes before the market closes and also looked at important levels on the daily and other time frames going into the release to have some kind of an idea at what levels bullish - earnings beat and/or upward revision of forward guidance - and bearish - earnings miss and/or downward revision of forward guidance - scenarios might be capped at. 5-10% is the maximum move an earnings surprise can elicit in the stock price at the time of the release. Sometimes with extremely bad or good news it can result in 25-50%. STMP made a move like that several months ago when they cancelled their contract with US Postal Service. In many instances continuation can be oberved the next day or a slight correction as the market/analysts continue to digest the news. The final quarter's earnings season begins in the week of October 15. I will be checking Earnings Whispers, Estimize and Benzinga for upcoming releases, estimates and track records. There will be many releasing earnings then but probably only a handful in a week that are really worth watching for break outs with a powerful short time frame move to justify a momentum trade. Many times stocks either make no move or it becomes a failed breakout as with SFIX, BBY and COST this week. Sometimes the information needs to be digested and you only see a clear move the following day. For those who watch the market close, spending another 30-60minutes watching earnings releases is not that much more work and it can be fun and in many instances very rewarding if you can identify the right move to get in on. If you are a momentum trader and watch the close after hours earnings trades could well fit into your style of trading. As mentioned earlier, the moves are big and price action can be very volatile....so if you want to get your feet wet, trade in SIM or take very small size relative to your usual size. Also, never jump at the first sign it seems the price is jumping....a lot of times you see big fluctations right after the close....this is kinda like traders being horses chomping on their bits..price needs to move with solid volume and then also I suggest (at least initially) waiting for the pullback on the first bigger rally up or down...to get in on the second wave. Many times the first rally makes up most of the move so it's either a chase or left overs...you need to be the judge for yourself what works or doesn't. This is where it's important to understanding yourself as well as reading momentum price action.

Here's a few I am going to watch to trade in after hours at the time of the release this week: COSTCO (Costco) STZ (Constellation Brands) BBBY (Bed Bath and Beyond SFIX (Stitch Fix) These 4 stocks trade >1million shares per day, have a decent size market cap and generate a lot of interest with insitutional investors/traders. They are liquid with small spreads. So they are tradeable assets on short time frames given a sufficiently large earnings surprise to generate a larger move in the stock price (>3%) . A big part of that that move - if it happens - usually happens right after the release...sometimes there's a retracement and/or continuation breakout/trend continuation in the pre market and at the open (which is where most of us usually trade them) and if it's a very big move it can continue as a trend during the next day or as a runner for a few days after. Here's a few more suggestions what else to check in the prior earnings history to prep going into the upcoming earnings release: - previous quarter EPS and revenue estimates: a company consistently beating estimates and current shareholders being rewarded for holding the stock are the best ones to watch (Costco is a good example for that kind of a stock) - watch for forward guidance, this is very important. $MU (Micron) beat earnings estimates but issued weaker than expected guidance and got thrashed for that (down now ~13%). - how did the stock react after previous earnings beats/misses: it's worth checking the % move a stock made relative to the % beat or miss they issued. This will give you some indication whether to expect a big move up or down depending on the direction (beat/miss). - BBBY and SFIX have much smaller market caps than COST or STZ, yet e.g. today they both traded a lot more shares than either COST or STZ. It's worth checking the volume in the build up before the earnings release. This will be a good indication as to the investor/trader interest in earnings report. - unusual option activity: e.g. last week going into Micron's earnings on Thursday, there was unusually large and bearish option trades placed the day prior to the earnings release (Wednesday). Savvy traders play earnings thru option bets bc they only have the option premium at stake. Rather than buying or shorting the stock, they buy/sell puts and calls for a small premium. Since those trades are recorded the total size of the larger trades can give you an indication in which direction the stock might be headed after the release. Investors/large traders follow big stocks and aggregate the news/analyst ratings to make their option bets so they are usually very well informed. Benzinga reports unusual options activity.

Earnings season is coming up soon again so I thought I'd bring up something I have been doing for a bit and others might be interested trying too. I have been trading earnings releases in after hours for several months now with some decent success. If you are a momentum trader who enjoys trading break outs or ORBs at the market open, especially have some success with 1-2min ORBs you might find trading earnings releases is a good fit for you too. My stats show this has been a profitable strategy for me. If this interests you, start by watching charts at the time of the earnings releases and maybe paper trading them. The best way to get an idea what to expect is to watch charts of popular day trading stocks like AAPL, FB, TSLA, AMD, MU, MSFT, TWTR, NFLX and NVDA at the time of their earnings release and maybe paper trade any break out. But also smaller companies or recent IPOs like UBER, ROKU, QCOM will offer nice setups. Benefits: - high point moves on short time frames - restricted trading time from 4-5pm EST in after hours. That's where usually most of the move occurs, when the earnings call is scheduled just after the close. Most companies that report in after hours, report very shortly after the close so 4-4:15pm EST. A few like CGC like to delay it into the evening so you cannot trade them well. Then of course , there's a lot that report in the pre market too but I have found those more difficult to trade so don't usually try to trade them. An exception was CCL which reported yesterday which reported an hour before the open and showed a nice tradeable breakout in pre market. Issues: - can be extremely volatile - hard stops are difficult to implement Requirements: - works better with mid-large cap companies that have high institutional interest - only companies that have >1million shares traded per day, the more the better (this is a bare minimum, patterns will be more tradeable the higher the number of shares are traded per day) - you need to map out timing bc there's only a short window of opportunity right after the release if you want to capture a piece of a possible break out pattern. So you need to have a trade plan going into after hours, i.e. know which companies report and which ones you think are worth tracking and have the charts and montage locked and loaded on your deck. I have already studied charts on various time frames with their support and resistance levels prior to the earnings release. On any given day during earnings season there will be many reporting but only maybe 2-3 worth watching for a tradeable pattern due to the high interest and volume required. - I use Benzinga's feed to get a heads up on the earnings release. I already have the charts pulled up and an approximate plan based on investigating consensus analysts estimates and earnings track record of the more important companies. You need to have this ready for the important companies you want to focus on. Two recent examples were Nike and Micron....I traded Nike but did not trade Micron yesterday. Micron was a bit too volatile for me but Nike showed a nice tradeable pattern earlier this week. As with any break out trade finding a very good entry on a pullback is the KEY to SUCCESS. This also avoids getting in before a clear trend is established. Because it takes traders and the market time to digest the news waiting for the pullback from the first clear trend will keep you out of most of the trouble caused by the stock whip lashing back and forth which can often happen because there's no clear bearish or bullish trend yet established. Breakout trading is very risky...if you interested trying this out, don't jump in...protect your capital by paper trading and/or get your feet wet by using very small position size.

If it's not just a video game you need to tie trading to how you support yourself (income generation)....and you need some sort of goal for that...it doesn't really matter what it is, just need to start with something and then adjust iteratively to your trading results. I have a goal but it's not set in stone. I know where my niche is so will adjust as I see fit depending on market conditions. It's a fuzzy line between gambling, gaming and running a business to support yourself so self awareness is key. A goal helps keep me focussed.

Congrats on getting the Lifetime membership....you won't be disappointed....especially if you are seriously committed to learning. IB is the best broker for day traders (if you have capital to support that size)....however growing a small account is the best way to protect your capital while learning the ropes and making the mistakes all of us make. The small account size will protect you from putting too much capital and risk on indivudual trades or on bad trading days where things can go awry bc your emotions get the best of you. Its simply more economical to burn thru capital in 1-2 small accounts while learning....you will lose less for the same learning experience. You may ask, isn't that why I am paper trading for a few months? The reality is things will change dramatically in trading psychology once you go live....simply put, it's similar to walking a rope one foot over the ground vs one that's hanging over a canyon....so rather than switching from the one thats hanging one foot above to ground to the real one...it's better to increase the distance from the ground. It's similar to controlling position size and risk in an account except that by putting a hard ceiling on your buying power you don't get to make certain decisions yourself until you have matured to a certain level. One other note I forgot to mention...there's a limit to how much buying power you can effectively use for day trading ....that limit will vary from one trader to another depending on how experienced the trader is and the strategies he uses. At some point, when your day trading IRA hits that ceiling you will need to move equity over back into another IRA where it can grow using more conventional investment strategies that yield the usual 6-8% the SPY averages YoY. Using some of the numbers and $100K as a ceiling for realistically using your buying power for day trading that would yield 25-75K annually depending on your usual daily % gain being 1-3%. Again there's some assumptions built in here...the biggest one being having established a record of earning 1-3% consistently over months to a at least a few years probably. If you have that setting aside a portion of your IRA is definitely a viable investment strategy especially bc of the effects of compounding and the huge tax benefits.

I found an even easier way....I always leave one row empty at the bottom of the viewer that I use to add a new ticker....then after I type in the new ticker and press enter/return the cursor moves to a new empty row....the key here is to leave that last row unused after you have entered all your tickers and then freeze this when you save your DAS layout after each trading day. The next day when you come back you can delete tickers/rows you don't want any longer but you should still sort the viewer by % before entering the new active tickers you plan to watch this trading day using the same method. That way the empty row will appear at the bottom ready for you to enter a new ticker..remember to hit the return/enter button for a new empty row to appear each time.

As you said disbursement from an IRA and taking the tax hit is one way to fund your trading account...another way is to take a loan or draw on an equity line...interest rates are heading back to all time lows again so it's probably competitive especially if you are working and can make some monthly payments on the principal to pay it off in short order. IRAs are just not well suited for use as a primary day trading account.....however as pointed out in the video as a secondary day trading account it allows you to grow an IRA from within w/o any tax consequences. Essentially, this boils down to funding the account with tax free monies and then only being charged taxes at the time of disbursement when likely your marginal tax rate will be lower. This is not something someone would try who is just starting out as a day trader but more for someone with a solid track record of profitability bc the last thing you want to do is to blow money Uncle Sam has allowed you to grow tax free. The 2 main draw backs are not being able to short stocks and the broker not adding 4:1 margin to your buying power. The first is a real drawback for almost all day traders who also like to short but if you have 2 accounts you could just mirror 50% of your long trades in your IRA account that you are taking in your regular day trading account. The lack of 4:1 margin may or may not be such a big problem depending on your goals...again only if this is your secondary day trading account as explained in the video. Obviously, this strategy works better the more solid of a day trader you are are and the more cash you have sitting in an IRA that you are interested growing at a higher ROI than possible by most investing strategies, which in an average year might yield 6-8% on equity. A simple way to look at this is take your daily ROI and divide that by 2 since you will only be taking half the trades (only those you are going long) to calculate what your annual yield might be. You also need to divide that by 4 bc you don't have the buying power so in effect you might be around 1/8th of your average daily return rate. So someone who usually makes 1% on a 30K account with 4:1 margin and shorting 50% of the trades would only be able to take 1/4 of the position sizes. In reality most traders don't max their buying power 100% of the time so 1/8 of an ROI is a conservative estimate for someone who consistently averages 1% on his day trading account. Annualized this works out to be $30,000 * 1% ROI * 220 (trading days) * 0.125 = $8,250 or a 27.5% annualized ROI....pretty sweet! If you average more than 2% as many solid traders do that 27.5% doubles to almost 55% or $16,500 and if your average return rate is 3% as a few very good traders are able to the ROI triples to a whopping 84% or $24,750. Did I mention the effect of compounding? In your 2nd year you will now have grown your IRA day trading account from 30K to somewhere between 38K - 55K and this compounding continues as long as you trade until you want to take disbursements in retirement. So the way to look at this is getting a better ROI on a portion of your IRA through day trading and then leveraging the effects of compounding on equity that's not being used to cover running expenses. Keep in mind that's all without owing any taxes to Uncle Sam and no extra effort besides mirroring long trades with no margin leverage in a separate day trading account. Which all can be done very easily in DAS Trader Pro with Interactive Brokers as one of 2 brokers providing settlement margin. The other is TD Ameritrade but you cannot use the DAS Trader Pro platform with them. I have retirement accounts w Fidelity and started a separate thread somewhere else about the tools they offer for active traders...just search the forum if you are interested or DM me.