Episode 124 -- "madaznfootballr" (72:58)

"Max"
Born in 1989?
Lives in California
Trading for six years
"Scalper"
"Rebelling against societal norms"
Made $5 an hour counting cards in blackjack
Sold stuff on eBay that he found or found mis-priced in stores
Studied structural engineering in college
Couldn't get a job after the Great Financial Crisis
Lots of student loan debt
Even when he did find an engineering job, it was a disappointing one
Colleague showed up in Lotus Elise, made money buying BP after oil spill
Max knew nothing about the stock market then
Opened an E*Trade account with $6,000
DANG first stock he ever bought, looking at 15-minute delayed quotes
Eventually found out about live quotes and E*Trade Pro
One year of trial and error, "completely clueless," no one to guide him
Started googling "hot stocks" and "stock tips" led him to message boards
Learned you must be a completely independent thinker
Almost quit in first year, suffered losses and a "damaged psyche"
Cumulative process, one day everything just clicked
Pattern recognition acquired after a year
In hindsight, he should have paper traded
"Money-hungry kid" deprived of a good career
Would go all-in on lots of trades
Play small until you acquire the necessary skills
He was too impatient in early days
Don't overextend yourself
Trading is not easy, it's true that 90% of traders fail
It's the psychological aspect that makes people fail
Worked as engineer for three years, and snuck trades on the side
Saved five times his salary ($300K total) and made two years of six figure gains before going full time
Traded early in the morning before going to his 9 to 5 job
Traded OTC and penny stocks at first
Naturally impatient person, naturally anxious person
Scalping suits his personality
Gets in and out extremely fast
"Typical" holding period of two to three minutes
"Typical" number of roundtrips per day: twenty
You have to be quick manually and make quick decisions
Hotkeys are huge, without them like bringing knife to gunfight
Has price levels pre-entered (limit orders, I guess)
Always uses limit orders, never market orders
Gets up at 6AM (Pacific time)
Looks for low float, low priced stocks gapping up biggest, "top gapper," large volume
Started with one minute bars but switched to three minute bars
ThinkOrSwim had three minute time intervals as default
The "tape" is main thing he uses to make trades, hard to explain
Spotting "Iceberg" orders ... "bid prop" and "refreshing seller"
Record your screen: Level 2 and Time and Sales and the Chart and re-watch in slow motion
VWAP gained prominence in recent years (2013 2014)
Over / Under VWAP ...
Need to be mentally stable and confident to trade
Meditates and tries to enjoy life to clear his mind
If you have addictive personality, self-control or anger issues -- they will come out in trading
Don't trade during low volume hours, just walk away
Identify if you have an addictive personality
Give back to the community
Comes from very humble beginnings, never been interviewed before
www.madazmoney.com
Twitter: @madaznfootballr