How This Independent Retail Trader Went From Losing Money To Trading Profitably

In this video, learn how this independent retail trader went from losing money to trading profitably. Learn the changes this bright and ambitious independent trader needed to make to go from consistently losing money to growing his trading account.

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in this video learn how this independent
retail trader
went from losing money to trading
profitably hi i’m mike bellafiore
co-founder of smb capital and we’re a
proprietary trading firm
located in midtown manhattan and i’m
also the author of the trading classic
one good trade
and the playbook click our subscribe
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in the trading community learn the
changes this bright and ambitious
independent trader needed to make to go
from consistently losing money
to growing his trading account okay so
thanks for having me
um my name’s sam i started on dna
in like late february and um before that
you know i i wasn’t with smb and and
it’s made a lot of difference to me
i’d sent mike a note
earlier in the week and just to say
thanks basically
it’s made a real big difference to my
trading and um
you know it’s it’s nice to reach out and
say these things so
in return mike asked me to share a
playbook trade
and so this is it tell me a little bit
about
what you’ve been doing previously
uh before starting to train with us
so i had various experience over like a
pretty long time like
way back in the day 10 years plus ago i
like
read stuff about warren buffett et
cetera et cetera tried to you know value
investing
nothing really serious uh i moved out to
the us five and a half years ago
got myself uh involved with a
well actually tesla um and that sort of
involved me with a growth stock for the
first time i got to know it intimately
and i feel very comfortable with this
talk
um but i didn’t really try to start day
trading
seriously until late last year in about
november um
and you know in the six months leading
up to the end of march
i didn’t have great success um so so i
actually went searching for a
a way to improve myself my training
everything
and um i’ve had really good success with
with
the content from smb and uh
you know actually covert has been a
really interesting time
um it’s allowed me to focus way more on
on this stuff and i think it’s made a
lot of difference
recent past i’ve well that’s now three
five figure days as of today so
happy days um it’s it’s made a lot of
difference
yeah the key here is you
made a change you saw that what you were
doing
wasn’t working for you and
you took action to make things better
that is what elite traders do so as you
continue to get better and better and
better
you’re going to continue to have to
change
you’re going to continue to have to
adapt we’re doing that
on our desk as well our best traders are
doing this as well
shark is working right now on making his
trading less stressful
swang is working on
uh something that gives him more energy
for his trading
one of the top traders that i coach
outside the firm
is working very specifically on his risk
management
another trader that i work with is
is working on stock selection these guys
are all
elite traders million dollar traders
many of them majority of them the worth
of five million dollars a year
in that p l and they are making changes
they are they they are not just
improving
but they are they’re making tangible
changes to what they’re doing
and so you’re it’s great
that you’re having success here
but the thing the thing for other people
to learn from this
is that as you as you progress in your
career
you’re going to need to continue to make
changes
you’re going to continue to need to
adapt and
find the solutions for how you’re going
to change
so terrific learning lesson for lots of
other people in the trading community
about the importance
of change all right let’s get into your
trade
so big picture this was a trade that was
made on
uh monday this week 5 12. um
and over the weekend the spy had hit 295
um and basically been fading all morning
in the pre-market
um before the open and then by 8 45 a.m
i saw a change in momentum um and
bounced off the 289 level
which had sort of been of recent support
in the prior week
uh the last few weeks before that we’ve
seen
a lot of volatility compression and
market grinding higher strong on buying
bids steve has noted this many times in
the weekend review and
daily call and that’s been super helpful
and sort of framing my thinking around
if you want to learn three real world
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years of online education tesla like i
said i’ve followed this stock
intimately uh for a long time i’ve been
involved in it and
there were several trades i could have
put into this playbook i wanted to put a
nice
straightforward trade that i was really
happy with and i would i would like to
repeat many times again
um so tesla had gapped down uh over the
the weekend um there was this sort of
tweet from
elon about you know that’s the last
straw i’m gonna sue alameda county we’re
going to take our
manufacturing over to texas or nevada
and it’s you know kind of a credible
threat really
um so yeah market market uh
market took a little dip there um and
this is often in the context of tessa
being quite strong
in in the lead up to this time uh but
again as usual lots of volatility
so pre-market buyers well they stepped
in at the
friday support um this is okay that’s
that’s the spy 289
yeah um but what we’re also looking for
is uh actually that should say 789
and then stepped up to 289 before open
um so
what we were seeing was the possibility
of a deal to reopen fremont off the back
of this tweet and the depth that
that was uh in response um
moving on there fundamentals here so
aval the day
was was you know 0.89 nothing super high
we wouldn’t necessarily call it an
in-place dog except for the news
and the catalyst over the weekend
average of all uh
volume sort of 18.55 million float 147.
institutional ownership you know that’s
quite high and usually gives you
an underlying bid short interest you
know on the low end for for tesla in its
history
and atr you know this thing can move 50
dollars in a day
and no big deal or 49.29 to be specific
sam how often are you trading
tesla probably once a week maybe maybe a
couple of times really depends i’m
trying to be pretty selective about the
setups
um in this case i actually went with the
shares a lot of times i’ve used
options and that’s worked out well um
for example when elon tweeted the friday
before
about selling all this stuff and tesla
being overpriced there was there was a
great opportunity there and um
took advantage of that so so when when
the trades come up you know i’m
i try to be there like i said following
it pretty closely
are you watching it every day but maybe
taking a trade once a week
pretty much yeah i definitely check in
every day and look if there’s
something that looks um you know
something that looks like it suits me uh
i you know i have a particular
setup and this is actually very close to
what i like to do is like
uh buying buying a dip
and holding it uh to see if i can hold
it
you know for a few hours basically um i
try to use v web and
we’ll get into a little bit of that in
the next slide yeah and i do see
if you’re going to trade a high beta
name guys doing better when they track
them
every day necessarily not necessarily
trade them every day
but certainly tracking them every day to
get
a feel for how they’re moving
can be very helpful for trading a high
data namely and that’s something i’ve
noticed in my stats
over you know since i started recording
them um
that that really i have more success
particularly with tesla but high beta in
general
so that’s something i’m sort of honing
in on and
trying to bring into my trading a little
more okay so the uh
trade plan here was basically to watch
for an early flush
i want to see confirmation um of the
support of the kind of previous day
actually of the the lower level in the
pre-market
um and we got a little bit below there
but
there was really such strong momentum um
that
there was an opportunity in the end so
the ideal case was to close
uh near the high of day looking for 820
plus
uh or you know if momentum fails i’m
happy to get out there and and take the
profit
so key levels for the morning um support
790 786 780
uh these are these are super relevant
recent levels for for the stock
and then you know inflection 800 i
haven’t listed it there but
um and then this is where i got my 820
from was r3
i’m an optimist so big picture
tesla back to um november
so much coverage on this stock everyone
did the big run up and then it
came back to 350 and sort of been
grinding up since um so there’s this
anticipation of the battery day coming
up as well
um and you know we’re seeing some kind
of consolidation
in and around the 750s 800
um so yeah that’s a range that i’ve been
taking note of
closer to the date um this is kind of
just this year
really you know just watching that level
and and
for me big picture looking for for like
a longer term breakout over
800 to sustain so this is of the morning
friday is opening low
we did test that just before open
and that’s like one of these
one of these there um but when i saw
this like
first real momentum coming in
so there’s there’s the wick testing the
friday’s low
um basically we saw a really strong
reversal momentum on open i usually
don’t enter a stock
uh this early in the in the game but you
know the plan was clear and we were
right at the target so i thought
okay let’s come in uh let’s see what
happens um
you know this wick was a potential stop
out area
um but again it was very quick and so
that was that was not
triggered for me um from there i was i
was
happy to see it you know dip through
vrap but
again recover really quickly we’re
seeing that the downside momentum was
really
um started to compress early it didn’t
have any follow through
so once once we really got sort of above
ewap
um i was pretty happy to hold it sort of
step back
and you know again i think there were
some
possible opportunities to add into that
etc but
that wasn’t really the plan for me on
the day so i got some notes
basically we had v-web confirmed between
9 50 10 am um and that you know for me
i was happy to see that that confirmed
the trade for me that would have been a
nice
spot probably to size in a little bit um
consolidation overview up again we get a
little sideways motion at about 10 a.m
steve often talks about that and that’s
that’s a good one to watch for we had a
leg higher there
and then i’ve got a two-day v-wap um
that i like to see strong stocks get
over and consolidate
uh when i start to see it go sideways
here i you know i basically said hey
look i’ve taken a big chunk of the move
it’s pretty early in the day um why
don’t take some risk off the table i can
always re-enter later
um so for me that was that was uh that
was how the trade went i was
pretty happy with that um
so we can see ninth uh 931
790 350 entry
uh let’s stop like i said 785 i didn’t
quite get back there so that was good in
this case
uh profit target 820 didn’t quite get
there um
trying for a one to three and the exit
in the end was a 1.5
r um so that was really just you know
two hours seven minutes later and we’re
we’re out so
i saw the momentum slowed on the five
minute chart the
the range was compressing compressing
and you know i
if i see the v web you know going flat
or flattening out uh particularly after
11 am like
it starts to give me you know um
the notion that things aren’t really
going to move much and
tend to get chopped around so i’ve
learned from experience that that’s
that’s a good time to move on
yeah as opposed to so that’s an advanced
trading uh point that you’re making
there you want to see view uh
trending up as opposed to it starting to
flatten out
yeah definitely and that’s that’s
something i’ve just learned from
experience recently making notes
reviewing my trades and
um it’s helped me a lot you know it’s
just for me it’s a build up of all these
tiny little things said something
interesting you noted that you trade
high beta particularly well and you’re
starting to see that with your
with your stats are you starting to
conclude that
you are better trading these high beta
names
yes i think i have enough evidence to
say that
yeah what strikes me also is your use of
technical analysis
i see that quite often when traders are
successful with high beta names is that
they
are seeing that in their stats but they
also tend to lean on the more technical
side now
to be successful as a high beta trader
and be a technical trader you’re going
to want to find the ones that are doing
the best or doing the worst
the ones that are going to you know
really have order flow behind them
to help you out a lot and i think that’s
where my comfort level comes from i
just i feel like i have a better feel
for what’s
going to happen and i think the the
uh thickness of the order book the
volume actually helps me there a lot
um you know i don’t feel like it’s just
going to really snap back
without some sort of catalyst and get me
completely chopped up
um so this is a trade like i say that i
entered very early
on strong confirmation of of s1 and a
sharp move higher this is not something
i
usually do but it’s i like the idea
i am working on refining ways to
to take advantage of strong morning
drives uh
so that’s something for the you know
the the workbook back there um
in this case like i said there was an
opportunity to add extra
extra tear at 10 a.m um but i was i was
in it full size
and um that was that was fine for me at
that point i i didn’t want to go further
um you know i’m trying to work on this
idea of
uh enough and not having fomo and you
know
there’s trades here that i’m watching
right now that i’m like okay yep that’s
still going and that’s that’s perfectly
fine there are more opportunities out
there so really having this kind of
mindset of there will be another there
will be another there’s no point
worrying about missing out
and and that allows me to sort of free
things up a little bit
um so yeah i like i say i was prepared
to exit
with a failure under vu app um which we
didn’t see there are a couple of tests
for sure
um 800 was also the inflection point and
i was looking for
whether that could sustain through there
as well
but yeah in the end it actually it
actually went through so
that was really great um another
opportunity to add some size between
1005 and 1020
around the 802 so that’s confirming the
inflection point
and probably
could have sized down a little earlier
than i did i have a little tendency to
overstay sometimes you know being the
optimist so
wow my profit target was 8 20 and we
weren’t quite there yet but
you know i think i got out at the right
time in the end and i
was actually pretty happy with that kind
of flat line for the rest of the day
pretty new to this i have a long way to
improve um now
is is that your baby in the background
yeah yeah yeah she’s
you are on five months old you are
unflappable
a lesser trader would would have gotten
a little perturbed perhaps
i’ve had a lot of practice she’s lovely
and
it’s a lot of fun but uh yeah man what a
handful
so she’s out first uh okay congrats
yeah so thank you with that in mind
basically
i have i have two young kids and they’ll
bust in at any moment
at this point and you know probably
knock down everything we’re doing right
here as well so
give it a couple minutes fantastic yeah
it’s all about the focus
and um she’s she’s just been such a
great thing in our lives so we’re we’re
really stoked
um so with that in mind baby steps
basically i’m trying to just iterate
you know regularly very slowly in
incremental ways
um just like you know my daughter goes
from
flopping around on the ground to rolling
over to now i can sit up now i can crawl
little bits at a time and to me that’s
that’s actually been the most powerful
thing
um that i took from all the s p training
stuff is like there’s so many things to
do there’s so much
uh area for improvement for me basically
but i thought look let’s start really
basic
and there’s a long list of things that i
know i can still improve on
and i’m excited because hey like it’s
great i’m doing the things that i
focused on doing now
and i’m seeing a little bit of success
and what i’ll do over time is just fold
in
those new elements you know i’m going to
improve this little little part i’m
going to improve that little part
i’m pretty happy with the approach that
i’ve taken here
um it’s for me i work really well with a
structured routine
um and reflecting on that regularly i
actually need to sort of get away
step back um go do some meditation etc
to really sort of bed that in and so
each day
i’ll remove something that doesn’t work
and i’ll bring something in that does
and try it out and if it doesn’t work
i’ll remove it the next day so
kind of low overhead way to improve the
process
important to me has been sort of like
maintaining the positive mindset uh
you mentioned about um shark trying to
trade with less stress
and that’s that’s something i i heard uh
i might have heard you say in one of the
youtube videos but
basically that’s something that’s like
actually that’s a really great idea
we had a virtual happy hour yesterday
and we were talking about
hey what are some of the things that
people are doing to that are really
helping them
and you know it seems counterintuitive
that
a huge great trader like shark would be
working
on de-stressing
be working on limiting his stress i
think there would be a thought that
big traders large traders
they have to get used to handling a lot
of stress
i would think that that would be the
thought that most people have
as i become this bigger better trader i
have to just get used to
holding bigger size and holding through
pain
and dealing with some fluctuations in p
l and it turns out all of the elite
traders
that we have at the firm and that we
work with outside the firm
all of them to a person are working
on making their trading less stressful
and all of them as they make their
trading less stressful
are making more money i would tend to
agree with that
um from from what i’ve seen like many
many nights
now like one of my goals has been you
know basically
have fun you know take it easy
don’t worry too much about these kind of
you know little things that set you off
um and yeah no it’s it’s really great to
buy since
it’s been super helpful um so yeah like
a big part of this
methodology or routine that i have my
son says your meditation is helping
quite a bit
oh yeah i i find that
when i skip some sessions and
my i do more mindfulness training that
you know when i’m hitting my mindfulness
sessions
day in and day out i’m literally a
different person
and maybe carlton contest to this i’m
literally
our floor manager i’m literally a
different person when i’m hitting
my mindfulness sessions day after day
after day after day then as opposed to i
miss a couple of days i feel it in my
body now
feeling the way i think um
much more productive when i’m hitting my
mindfulness
uh day in and day out and it’s think
much better
much more focused i can sustain my focus
for longer periods of time
more open-minded uh able to take
advantage of
the exciting opportunities in the
marketplace better
because i’m in a better mindset i
couldn’t agree more that was something i
realized pretty early on
that um for me doubling down on the
meditation was
was going to be a really big lever a
strong pathway for improvement and
i’m on i’m on like a 40-day streak and i
basically hadn’t been doing any before
that right now so
um i will i’ll be keeping on with that
that’s one of the last things that i
will change
if anything i would do more don’t
don’t break this don’t break the chain i
know exactly thank you
jerry seinfeld um so yeah
writing in my journal a lot it helps me
in conjunction with the meditation
um i use it as a sort of tool to stop me
jumping into things when i when i feel
like i’m getting a bit like oh you know
chasey um it also helps me get thoughts
out onto the page which gives me clarity
which which usually leads to better
results
um just even if it’s avoiding trades
that
you know look good at the moment and get
you excited and you know that that’s
that’s been something i’ve worked on for
sure
writing my goals before bed that’s
definitely
been useful and reading it first thing
um
i used to you know have like a page you
know page full of goals and now i’ve
really just refined it down to
two or three things um and that’s helped
a lot usually it includes like
be consistent you know uh be
consistently profitable is ideal but
consistent first in the process
um focusing on process
um so in conjunction with the meditation
my uh approach to managing my
like emotional state um is to sort of
burn off excess energy or nerves
with with like push-ups or chin-ups or
like whatever do some squats jump around
just
get out the energy and then again it
allows me to sort of be more
clear-minded
um and the last one here that’s been
super super important
is like trader view has been my second
best investment
after the dna course it’s really just
shined a light on
hey go and do more of this go do more of
that like oh you’re making like twice as
much out of options
go and learn more about options like
okay good this is really
handy stuff to know and it’s actionable
um
so yeah that’s where i’m at and super
excited to
be part of all this and what a great
time to be alive
sam well great job making a change very
excited for you
really appreciate your contribution to
the trading community right here
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