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5 Reasons You SHOULDN'T Trade After Hours - YouTube

Channel: Timothy Sykes

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- You really should not be trading after hours

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and I'm gonna explain exactly why

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here are five reasons study up be safe.

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(upbeat music)

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Hey be sure to subscribe on my channel

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and click that little alert notification bell

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so you get alerted when I give you more of my wisdom.

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What's up Tim Sykes Millionaire Mentor and Trader here

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passing down the tips I've learned over

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the past 20 plus years now that I've been trading

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in 10 years since I began teaching

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I have five millionaire students so far

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with many more getting close to a million

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lots of new stick figure students props to you guys.

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But here are five reasons why I don't think

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that you should trade after hours.

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I know a lot of people like it because they think

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that they can get ahead but I think that you're

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just you're working against you know what's predictable.

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Number one there's very low volume after hours.

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There might be like company news you know

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that might report earnings it might be like

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a new insider buy or something.

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But usually it's very light trading compared

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to normal market hours after hours trading

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by the way is 4 p.m to 8 p.m Eastern.

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I guess you can even include pre market in this.

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I know a lot of you like to trade pre market again.

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I like to look at pre market winners

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and after hours winners but I rarely will

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ever trade unless the news is like amazing where

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I just wanna buy it because I think that

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when other people see the news they're gonna

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wanna buy but that happens more

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than no more than I don't know.

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I can't even remember the last time

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that I cheated after hours that's just

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to help you understand like it happens

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less than five times per year.

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Number one I don't think that you

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should really want to trade during low volume periods.

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It opens up a lot of risk you know because you

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might think that the news is good

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and then the news isn't and the volume is

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so light like the price changes like

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that your stop losses or mental stop losses are irrelevant.

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Like I said you know there might be some news

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and so like a stock might be spiking on good earnings

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and then an earnings conference call starts

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and the CEO says something bad and you just get slammed.

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So you're buying on the good news

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of the press release but getting slammed

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on a conference call that you have to like

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listen to every second and try to think

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about everything that the management is saying.

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They might even say something that sounds positive

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but maybe Wall Street expected them

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to be even more positive.

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So you're opening yourself up to a lot of risk.

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Secondly there's low price volatility.

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Usually like I said like the biggest moves

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happen right around the market open

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right around the market closed.

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After hours you might get some rip song action

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like I gave an example where there's

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like good news on in a press release

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and bad news on a conference call.

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Very rarely do you see just

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you know great opportunities to trade the volatility.

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That's not to say that there's not big percent gains made

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but usually what happens when there's

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like good news or bad news the stocks drops

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really quickly with bad news or spikes

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really quickly with good news.

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All like within two or three seconds

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you can't really try to trade that.

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So for me the biggest moves and

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the best moves for trading happen

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around 9:30 a.m. Eastern until 10 a.m. Eastern

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and then 3:30 p.m. Eastern until 4 p.m. Eastern

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during normal market hours not outside of those.

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Number three a problem with after hours is

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that there's huge spreads because

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there's less volume because frankly a lot

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of the market makers have gone home

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a lot of the traders have gone home

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after hours or pre market you know

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there's not really any like West Coast traders

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up at four thirty in the morning

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or five in the morning which would be 8 a.m. New York time.

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I just I don't wanna trade with when

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there's so much risk cause even if

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the stock is trending in your favor you know

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one bid gets taken out and then all

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of a sudden you have like a 5% loss

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out of the blue versus if you waited

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for normal market hours and you know

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a bid got taken out because there's

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more volume because there's more traders

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and market makers that are present you won't

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have like these air pockets where you

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can just lose five or even 10% quickly,

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especially when you're trading low price penny stocks.

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I like to cut losses quickly after hours

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and pre market you can't exactly do that.

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Fourth the charts are not clean.

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You might know that I like chart patterns.

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You get a lot of whipsawing price action

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a lot of choppy price action after hours

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and pre market I don't like that.

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There's also a reason why I don't trade midday very often

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cause you get a lot of choppiness so I try

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to stay away from the choppiness yes you

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can make money if you buy at the bottom

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and you sell the top and you buy the bottom

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you sell the top there are some traders

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that like doing that for me when

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there's choppy stock I usually don't do very well.

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And I think most traders can agree with that.

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And it's also just very frustrating very time consuming

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you know you gotta like just I don't know

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my brain hurts if I'm trading after hours or pre market.

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I've done it or midday I've done it before

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I've tested this so that you don't have to.

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And fifth rest up.

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Right like for me I want the stock market

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and trading to give me a better life.

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I don't wanna work a nine to five job

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or in this case I mean this would be like

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if you want to trade pre market starting at 8 a.m.

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Or some stocks even start trading at 7 a.m.

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So I don't wanna start work at 7 a.m.

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Which means I have to be up like at 6:30 a.m.

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If I'm in New York if I'm in L.A. I have

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to be up late at three thirty in the morning.

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And if I'm in Hawaii what I have to

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be up at like one like no no no no.

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I wanna rest up and the good news is like I said

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the majority of the most predictable patterns

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are around the market open and the market closed.

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So theoretically once you studied enough

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and you know these patterns inside and out

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you can trade for an hour at the market open

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in an hour at the market closed two hours per day.

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I don't wanna get up at 1 ,3 ,5, 6 a.m.

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And be prepared for pre market.

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And then if you want to trade after hours

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you go until 8 p.m. Eastern

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so I mean if you want like a full day

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if you wanna trade pre market during market hours

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and market closed and after hours

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you're talking 8 a.m. to 8 p.m.

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I mean that's just a job that's worse

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than a nine to five job maybe it might pay

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a little better but maybe it won't

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never forget 90% of traders lose.

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And I think a lot of the people who lose

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they're trying too hard and I know that sounds weird

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because people say well Tim man

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of course I'm gonna to try hard I wanna be rich.

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But it's kinda like the game of golf

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if you ever tried to hit the ball as hard as you can

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it's actually not as good as if you have

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the right form and you know you let yourself

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just kind of go through the swing.

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Like I know people where they're

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like baseball players and they just

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wanna mash it as hard as they can.

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That's not the game of golf.

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It's a game of patience and trading is very similar.

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So no matter how much you wanna make money

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trading all the time burning yourself out

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with these crazy hours that's not gonna help you

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get rich in the long run that's gonna make you frustrated.

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It's gonna make you like cracked out.

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You're gonna be like a lot of traders

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were even if you're making a little money,

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you're like ah what a long day trading is such a grind.

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And frankly this is why a lot of people don't

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like me in the trading world or they attacked me

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in the trading room like Tim Sykes

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is a scam penny stocks are a scam

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because they're grinding all day

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They're trading that choppy action.

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They're trying to find little profit opportunities

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and they're not getting much sleep.

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You know they've made it a job.

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They've made themselves pretty

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much slaves to the stock market.

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For me I want the stock market to give me freedom.

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So maybe it's in my head maybe I've adapted

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to the patterns that give me the most freedom.

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Maybe that's true I don't deny that.

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But I have a lot of freedom to travel

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I have a lot of freedom to live.

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I have a lot of freedom to do charity

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which I really love doing.

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You can see I'm wearing my save Australia shirt

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click the link below I'm gonna include a link

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for my new save Australia charity 100% of

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the money goes to fighting fires and rescuing animals.

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Really tough times in Australia now

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with so many wildfires all over the place.

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So these are my passions these are my hobbies

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and I'm only able to do it because I've segmented my life.

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I say okay I can you know trade stocks

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from this time which is around 9:30 a.m. to 10 a.m.Eastern.

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I might look at pre market I definitely look

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okay if I'm up especially

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I will look at pre market because I wanna see

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the biggest winners the biggest losers

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I wanna see what's moving

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but often times I haven't even mentioned this yet

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but I'm often times you might see a big pre market winner

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you're like all the news is great

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it's up trending pre market and then

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when the real volume comes in

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and the market opens at 9:30 a.m. Eastern

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it goes splat okay.

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Pre market does not always go with

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what's gonna happen with the market when it's open for real.

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And same thing with after hours

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you might get an after hours spike on earnings.

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Then when the market opens the next day nothing.

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Not even because they necessarily say anything bad on

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the conference call just because when

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the real volume comes in a little a little

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after hours or pre market volume doesn't stand a chance.

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So please focus on normal trading hours

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5 Reasons You SHOULDN&#39;T Trade After Hours - YouTube

5 Reasons You SHOULDN'T Trade After Hours - YouTube