Am I Ready To Trade | Podcast Episode #489

0:00
Hey everybody. This is Ryan Mallory with shareplanner.com’s Swing Trading the Stock Market. In today’s episode, we are going to talk about am I ready to trade? Are you ready to pull the lever? Start trading, start trading with real live money.

0:17
In today’s episode, we have an e-mail from a person who lives over in Sweden, so way far away. I’ve never actually been on the other side of the pond. I know that sounds crazy. A lot of you guys have probably done it many times. I have not. I’ve been many places in North and South America, just never on the other side of the pond.

0:34
So Sweden is really only what I’ve read about it in the textbooks and, you know, through geography lessons, I guess. But any case, usually I give people a good Florida redneck name to conceal their identity so I’m not embarrassing them. But this person asks me to give them a good Swedish redneck name.

0:53
I didn’t even know there was rednecks in Sweden, but here we are. We got Swedish redneck named. He asks to be called Kenta Bob. That’s KENTA. So I’ve never heard that name before. Kenta Bob, Swedish redneck and Kenta writes.

1:08
Hi Ryan, I’m a big fan from Sweden. I discovered your podcast about a month ago and I’ve already gone through the entire archive and listened to many older episodes. I love the show and your whiskey reviews. You can call me by my Swedish redneck name, Kenta Bob. I started swing trading about three months ago and have been paper trading for over a month.

1:28
The plan is to start trading with real money in July as I feel ready. I’m also planning to begin learning about trading in day trading in July and start paper day trading in August. I believe swing trading suits my personality and profession the best, but I want to try everything now that I have some time off this summer.

1:49
I’d be more than happy if you turn this e-mail into an episode and touched on my questions. Here’s a quick summary of my setup. I use price action, primarily support resistance and sometimes chart patterns, and I trade stable U.S. stocks in a bull market. I usually trade stocks in strong sectors in a short and short a few in a weak sectors.

2:08
I use the 200 day simple moving average to identify long term trends. Additionally, I sometimes use the 10 and 20 day exponential moving average for trade signals, rate of change to figure filter out the slow moving stocks of 0 to 1% moves, stochastics like you do to avoid overbought and oversold stocks, and ATR to calculate stop loss and position sizing.

2:31
My questions? Do you have any thoughts or comments on my setup that I’ve just mentioned #2 In the books that I’m reading and various YouTube videos, people talk a lot about Fibonacci and different retracement tools, but I haven’t found any episodes where you talk about it.

2:47
I know it can be applied to both daily and intraday charts, but it’s mostly day traders who seem to use it. Do you think that it could be useful for me as a swing trader or as an aspiring day trader? And do you use it yourself at all? And if so, what Fibonacci settings do you recommend in trading view?

3:03
Could you share any thoughts on what I should focus on as I gradually move into learning day trading now that I’ve gotten a decent handle on swing trade based on my setup above? Which parts don’t really work for day trading and what could they be replaced with? Huge thanks and God bless Kenta Bob.

3:20
All right, Kenta Bob. Golly, I don’t know if I’ll get used to to that, that particular name, but nonetheless, you know, I like the uniqueness. Definitely never used that name in the almost 500 podcast episodes I’ve done now. So essentially the title of this this podcast episode.

3:37
Am I ready to trade? Is is the basis for for this e-mail here couple of things that I that I think about first day trading he’s going from swing trading he’s learning about it he’s paper trading it right now we’re in the month of June of 2025 in July he’s ready to start with real money.

3:57
I’ve often said in many other episodes as well that paper trading will only take you so far. And the reason for that is because you actually feel better about trading with real money when you’re paper trading, because it’s a lot easier.

4:13
There’s no emotions to it. You’re not trading with real money. It’s just like a monopoly. We’re an incredible businessman, a monopoly. We’re racking up properties. We’re, we’re, you know, getting all these incredible hotels and houses being built. But you try to duplicate Monopoly in real life, it’s a little bit harder.

4:30
You’re dealing with regulations and you’re dealing with red tape and, and, and really you don’t have the money to, to do what you thought you could do in the game of Monopoly. Kind of like the game of life too. Remember, I don’t know if that’s even a game still, but in the 80s and 90s when I was growing up, we had the game of life.

4:46
And you know, you would made raising kids and buying a home and having a great career seem easy, but you apply it to real life and it’s not. But what paper trading does do for you is it does help you to understand the mechanics of trading, helps you to understand limit orders and market orders.

5:02
Now it won’t be perfect because you’re not actually filling anything in real life when you’re trading, you’re actually being matched. If you’re if you’re buying a stock, you’re being matched with the seller. And if you’re selling a stock, you’re being matched with the buyer. Paper trading, you’re not because you’re not really paper trading with other people.

5:18
You’re you’re just paper trading on a simulator. So you’re going to get the perfect fills every time. So that’s the big difference. But what it is good for, like I said, learning about market orders, limit orders, seeing how they work, seeing them, you know and make believe action it.

5:33
It’s never going to duplicate the real world, but you do get a good handle of, of how the order processing does work. So at some point you do have to go to real money and then that’s where position sizing is important. And, and the other thing I tell people when you go to paper or paper trading to the real money, don’t, you know, throw your whole life savings at it?

5:53
You know, I mean, I think be crazy that, you know, if you had $100,000 in the bank and you go dump $100,000, right, right on all of those, those trades that right out of the gate, because there’s a good chance that the transition from paper trading is going to be very difficult to, to real money. And so I would caution, you know, about the position sizes. I would, I would use smaller position sizes, smaller account size until you get under control of the emotions, because the emotions are going to be far, far different than what you encounter in day trading or in paper trading. My other issue with what Kenta Bob’s talking about here is really with question 3 where he talks about now that I have a decent handle on swing trading and, and often times in these emails, I’ll pick up on little subtleties and nuances that they’ll, they’ll sit, they’ll stay in their emails and I’m like, oh, I don’t even think that’s really something that they were expecting to be addressed, but I’m going to have to address it.

6:44
And so they talk about already having a handle on swing trading. I try to be a nice person in these things and I’m trying to be a nice person here, but to just really just be brutally honest, you don’t have a handle on swing trading. You definitely don’t have a swing handle on swing trading yet when you have even gone live on the swing trading.

7:00
So you may understand like a little bit of the how it works, you know, from OK, you’re holding stocks overnight. You’re, you got to manage the risk, you got to plan out your profit targets, plan out the trade, follow your your plans, But you haven’t actually seen that in live action yet.

7:18
And I, I’d honestly be willing to say, I mean, at 30 years from now, 30 years into it for myself, I don’t have a handle on swing trading. And, and I say that the utmost, you know, humility that I can, you know, conjure up is that I’ve been doing it for 30 years and the market still throws things at me that I’ve never seen.

7:34
I think 2025 has been an incredible example of that. Just some of the most wild price action that we’ve seen in quite some time and some of the craziest responses to major market events that we’ve ever seen. And so the reason why I don’t have a hand handle on it is because is, is the very reason why I manage the risk.

7:53
Why manage the risk is so important. And I don’t think we should ever get to a point where we think that we have a handle on swing trading because we don’t, because it’ll always show you something new that you’ve never experienced before. That’s why, again, going into it with as much clarity on how you’re going to manage the risk, where are you going to take profits AT?

8:09
And you know what, what kind of position sizes you’re going to use and so forth is so incredibly important. I also take a little bit of issue with how fast these, this person, Ken to Bob is wanting to accelerate the learning process.

8:26
And it’s really not something that you, you, you do in a, in a hasty manner, something that you rush through. It’s really something that needs to be handled over a long time. If you remember one of my most recent episodes, that might have been the last one that I did, I talked about how people who are scalping.

8:44
Yeah, it was the last episode. They have to grind. They have to grind away. It’s not something where you’re trying to get huge returns on your trades. It’s something that you’re really just grinding away and taking pennies on the dollar sometimes and making a lot of different trades.

9:01
And the same thing with day trading. I think one of the big the differences in day trading versus swing trading and I think most people are not going to be good at day trading just because it’s a much more difficult skill to master versus swing trading. And that’s because you you don’t have the benefit of holding positions overnight when you’re day trading versus swing trading.

9:20
You do you also have to be right the very first day that you get in. I can’t tell you how many times I’ve gone into a swing trade and I’m not right on the first day. I would probably even go as far as to say that my least favorite day of a swing trade is the first day that I get in. I always hate that day because let’s say you get in and the stocks already up 2% and you’re going ahead and seeing that it’s breaking out, it’s breaking through some resistance.

9:42
It’s now up like 2 1/4%. So you go ahead and get in at that point because it’s now cleared that major resistance hurdle. And then it pulls back and it’s, you know, up 1.75% on the day. But when the day finishes out, yours down 1/2 percent, whereas the stock was up 1 and 3/4 of a percent.

9:59
It feels like you got off to a rough start on the trade, but the stock itself actually didn’t get off to a bad start. And that’s one of the things that I hate about that first day of trading or swing trading is that sometimes you’re not in the what feels like the most favorable position or, you know, the stock finished higher, but you actually finished lower.

10:18
And that’s just part of trading. There’s there’s nothing wrong with that. That’s going to happen at times, but it’s usually the days after where I, I actually see the game start picking up when that momentum sees the follow through and the crowd joining in. And, and then I forget about that first day of trading. But initially I don’t like that.

10:33
But in day trading, that’s all you have to work with is that first day because it’s the only day. And so when you’re day trading, one of the things that I would go into day trading with is a lot of experience of swing trading. And right now you don’t have that experience in swing trading, but one thing that you can have is swingtradingthestockmarket.com.

10:52
Yes, this is going to take you to my SharePlanner website. Really cool feature that goes along with this show. You’re going to get an opportunity to join the trading block or if you want, you can sign up for the self-made trader. This is going to be my flagship course that teaches you everything that I know about trading. 30 years of trading experience and lessons that I’ve learned packed into over 25 hours worth of videos.

11:15
On top of that, you’re going to get a lot of lessons and homework assignments that you go through. It’s a very, very long course. It’s a 14 week course, but I would encourage you to check it out if you can. Learn more about the self-made trader down in the the podcast notes below. Now he asks me about Fibonacci retracements.

11:31
Now he asks me about Fibonacci retracements. I do use Fibonacci retracements. I don’t really make too many trades off of it. Sometimes I’ll look at it if it’s in conjunction with a pullback on an existing trend line. Let’s say that this trend line has been tested multiple times and I’m seeing the stock pull back to it again. It looks like there’s some healthy consolidation or basing and it looks like it wants to finally bounce.

11:46
I’ll also look at it from a Fibonacci standpoint. Put a Fibonacci overlay and see if it’s not pulling back to one of the key levels like a 38.2, A 50%, or a 61.8% Fibonacci retracement level. If it’s doing that, that can give further confirmation that there may be some legit support there and a reason for it to bounce.

12:03
But using it in isolation, I really don’t for one reason. You never know which one it’s going to be that it pulls back to, whether it’s going to be the 38, the 50, or the 61. And it can be any of those and it, and it really doesn’t necessarily mean that a trend’s dead if it pulls back to one versus the other. Now the most healthy 1 to pull back to is 38.2, but often times you’ll see it go down to 50 or, or, you know, but sometimes where you see a lot of people get shaken out of the trade is when it pulls back 61%.

12:29
But nonetheless, trying to make a trade basis that OK, I’m going to buy it as soon as it tests the 38 or test the 50 or test the 61. That’s not the best approach to it because you, you’re really just, you know, taking a crap shot at it and it may not do it any of those if you I, I use them for both retracements and bounces.

12:46
If you look at the bounce off of the April 7th lows, clearly the market could have cared less about Fibonacci retracements to short on any of those retest, whether it was the 38, the 50 or the 61.8. Instead it blew through all those and now we’re sitting at all time highs.

13:02
So the Fibonacci retracements, well, they can be good. They are, you know, or informative probably is the better word. It’s not necessarily a strategy that I would rely on and one that I would rather say is worth looking at is pivot points. I love pivot points. Again, I don’t necessarily trade directly off of them, but they give me a much better clarity about what the overall market’s doing, what that essentially is.

13:24
For those who don’t know, what pivot points is, is it identifies 3 resistance levels and three support levels. The three support levels typically being below the previous closing price and the three resistance levels being above the previous closing price when it gets above R3 or down below S3, that’s usually some major extremes where if those levels are being tested, I’m not going to go ahead and get into a new trade, whether it’s a short at AS3 level or a a long at AR-3 level, not going to do it.

13:51
And these are things that are available on Trading View on TC2000 on Trendspider. They’re available everywhere, very easily accessible, but they’re very helpful and it’s based basically providing you support levels with a formula that uses the open, the close, the highs and the lows from the previous day.

14:08
So really a cool feature there. I prefer those, especially if you’re looking at it from a day trading standpoint. Another thing, if you’re getting into day trading one day or you’re on the verge of getting into day trading, I’m not as big of a fan of trying to trade these high momentum plays that are up 50% in the morning and hoping that they’ll go up to 60% and that you can get out for some change.

14:28
Because often times those are the stocks that get faded the hardest and it’s most difficult to manage the risk on. Instead, I would look at trying to trade like a SPY or a QS. And it’s very much like when you’re when you’re starting off swing trade, don’t try to get rich, OK, especially in a commissionless environment.

14:44
Learn the mechanics of day trading. Learn how to make money with a smaller account. Get that confidence up before you start expanding your portfolio or taking a much bigger risks. And if you enjoy this podcast episode, and I hope you did, please make sure to leave a five star review and tell me in the comments below.

15:00
What what is your struggles right now when it comes to swing trading or day trading? And what what would you like to see a future podcast episode be about? Love to hear from you guys. Make sure to check out my flagship course at shareplanner.com. Or you can learn more about it with a link down in the show notes down below and again some of your questions, ryan@shareplanner.com.

15:21
Let me know what’s plaguing you. Let me know what’s bothering you. I’d love to love to help figure out some stuff with you guys. Thank you guys and God bless. Thanks for listening to my podcast, Swing Trading the Stock Market. I’d like to encourage you to join me in the Share Planner Trading Block where I navigate the stock market each day with traders from around the world.

15:38
With your membership, you will get a seven day trial and access to my trading room, including alerts via text, e-mail and WhatsApp. So go ahead, sign up by going to shareplanner.com/trading Block. That’s www.shareplanner.com/trading-block and follow me on SharePlanner’s, Twitter, Instagram and Facebook where I provide unique market and trading information every day.

16:00
If you have any questions, please feel free to e-mail me at ryan@shareplanner.com. All the best to you and I look forward to trading with you soon.