Being Profitable Even With A Full-Time Job

Millions of traders have commitments that extend beyond the charts. This includes having to commit time to a job that is not related to the market and your account. This trader shows how he juggles life priorities, family, and a full-time job and still makes trading work for him.

Michael Bozzello
The Stocktwits Blog

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Mike Lamothe started investing in 1996 and is the Founder of ChartYourTrade. His mission is to inspire millions of hardworking people to take advantage of one of the the stock market. Mike is a husband, father, and a guy with a separate full-time job. Mike screens for a combination of elements in multiple phases and then utilizes the charts for when to initiate buying or selling. Some of the elements he looks for in Phase 1 include: Accelerating Earnings/Sales, Relative Strength and Price near 52 week highs, Sector Leaders, & Outstanding EPS. Mike runs this scan on ~8,000 stocks to narrow them down to 300–400 potential opportunities. These top opportunities are then put through a secondary screening of elements such as: ROE, Sector Rank, EPS growth rate, and much more.community. For the full transcript please GO HERE.

@MichaelGLamothe

I’ll kick it off. I scan the Russell 3000 and like the idea of limiting it down. How did you come up with your parameters? — michaelbozzello

Thanks for starting us off Mike! I started by trying to model the masters. I learned a lot from William O’Neil and the scans I run are derived from “How to Make Money in Stocks”. He doesn’t layout X, Y, & Z scans, but he does talk about what’s important in finding the stocks that can run several 100%. I built scans around those concepts.

Is it getting markedly harder (or easier) to find star candidates? Do you look at your candidates’ implied volatility? — bearcharts

Definitely getting easier! It wasn’t THAT long ago that people were drawing charts with pens and paper.Now we’re connecting with people all over the world instantly and getting feedback. The challenge now is wading through the noise. Its one of the reasons I feel self-awareness is so important. It helps be our guiding light.

Are you making money? — ElizabethII

Yes but its not because we’re in a super strong bull market. Its because I’ve learned how to manage risk.

What are you trading now? — Dusta_Rhymes

A bunch of stuff. I run 3 main accounts. A short term swing account, an intermediate term account, and a retirement account. I got stopped out of $TSLA this morning in my swing account, I’m still holding $DVAX $SNAP and $BABA in that one. In the intermediate term accnt I’ve been long $ADBE and $BABAsince Jan. I’m also holding $CAT $NVDA $NFLX $ISRG $RMD & $MNST. The retirement acct is just mutual funds from my employer. The follow the S&P 500 more or less so I trade it that way.

Do you typically wait for a close to decide whether a resistance or a support broke or it could be in session? — mohelmo

I’ll buy and sell intra-day and use buy stops and sell stops to do it. This way I don’t need to watch the market all day. Support & resistance is more of a zone than an EXACT number. I like to see multiple elements converge for support/resistance. For example, if support is at $100, I’d consider it much stronger if the 50dma is nearby, there’s a weekly low, etc..

What’s your favorite sell signal? — bxvets

That’s a tough one! I guess a favorite is one where I’m selling into strength. I sell in stages as I make multiples of my risk. For ex. If I risk 5%, I’ll take a piece off at 15%, another at 25% etc.

Once your scan is completed, how much do you allocate of your portfolio and is the portion allocated to options or commons or both? And, once you enter based on your scan for entry, what is your exit strategy with your trade? How often does your scan allow you trade? Daily,weekly,monthly? And what timeframe are you using along with any backtesting needed to complete the scan. — Liquid_Assets

I scan on technicals and fundamentals, but trade off technicals. I like to back into the number of shares I buy based on risk. I wrote a blog post about position sizing and created a free position size calculator. Most of what I trade is commons. I use options occasionally, mostly to manage risk. It’s all technical. It will be where there is established support that also has some moving averages nearby. I always want there to be multiple levels of potential support, the more the better. It serves as confirming to exit I’ll do my homework on the weekend, place orders, and wait for them to trigger. In my swing account, I average 2–3 trades/week. In my intermediate term account, I trade less frequently, but that’s the nature of the account.

Seems like lots of traders claim success and then start selling trading education. Why not just trade? — AdmiralTweezers

Yes, there’s a lot of BS out there. It’s the nature of the market & its not always easy to slice through the BS. I can’t speak for others but for me, I truly enjoy teaching. Been doing it for about 7 years in the Investor Business Daily meetup and then for another 5 years through my site ChartYourTrade.com. For me I’m on a mission. I feel as though there are far too few hard working people that take advantage of the market. Ilearned how to do it part-time w/ a family, full time job, and a child. I want to pass it on to others and for that to be my legacy. It’s about creating the change in the world you want to see.

What are your 6 largest positions right now and what made you decide to choose your top positions — Bullobo11

$BABA $ADBE $CAT $NVDA $ISRG $NFLX in that order. I didn’t choose them as my top positions. They started out about the same & then the market took over.

What software do you use to create your scanner, and how does it work? — Vegan4Christ

We developed ChartYourTrade MRI w/ @OptionSamurai it scans edgar.gov and it runs 8 scans & overlays the profile of an “ideal growth stock”. I outlined it all here. What’s super interesting to me is that as you tighten up the ideal growth screen, u get less stocks, but you get a much better hit rate. Meaning close to 50% of the stocks have a major run from the point they pass.

Give me your thoughts on RCII which is currently on takeover watch, how should I play what seems to be a 50% up? — DagnyTaggart

The chart is a wreck in my opinion. Its not something I’d touch right now.

@MichaelGLamothe

Is AMD a SELL or HOLD? 3.5k@12.6 KVIN

Depends on your timeframe but for me its a sell. Had a major run, broke below the 10wk and 40wk lines. Needs time. Here’s the weekly chart. Not looking good right now.

@MichaelGLamothe

Is it possible to technically trade with only free tools available online? — Flook

Absolutely! There’s a lot of good free stuff out there. Check out tradingview, freestockcharts, and finviz. I use the paid version of tradingview & it’s still cheap. Only about $10/month.

What’s the single most important parameter you use in your screening? If you had to pick just one. — SueO

That’s real tough because its less about 1 or a dozen parameters but how you mix them together. Gun to my head I’d probably go with relative strength vs the S&P 500.

I am a newbie options trader. I am looking for good scanning tips for placing options. Can you help? — Leisure_Suit_Larry

Check out @OptionSamurai and his site OptionSamurai.com. @SJosephBurns has a lot for new options traders as well. Check out this book.

Do you have an opinion on USD/JPY and Gold, or other supposed hard commodity technical pairings? — WiseWolf

No, sorry. I don’t get into those kinds of trades at all.

How do you determine your trades with respect to sector rotation; when do you switch to defensive sector stocks? — ChuChuRockit

I like to look at my scans and see which groups are expanding & which are contracting week to week in order for that to work, its imperative to plan out and run the same scans every single week. Here are the scans I run.

Whats your opinion about SPI stock? — TRUMPWALL

I don’t trade penny stocks. I don’t have an opinion on this one.

I’m noticing that technicals are failing more during earnings season. Is that something you run into also? Also, I use different technical analysis for different scenarios. DMI & Stochastics to find momentum, squeeze and waves for swing. What is your favorite TA analysis? — ChrisMichaels

There are different events that cause changes in trends. Earnings is the most common. yes, earnings can either strengthen OR change a trend I look at price and volume across multiple time frames (daily, weekly, and monthly charts) and use moving averages.

How long have you been using this technique, and what has your IRR been? — randomperson

Coming on 8 or 9 years…(man time flies). Last year I was up close to 25%. This year a little over 35% so far. I typically don’t mess with stocks that are under $10/share. Nothing wrong with them, but they don’t pass my scans.

When do you typically decide to enter a stock? What indicators do you use for safe short term entries? — jackbrown1

I use support/resistance and advanced entry points. Here’s a video we did a while ago.

What in your opinion are the most useless technical indicators? e.g. Bollinger bands, fibonacci, Ichi. cloud. — CaptainFalcon

I just use price, volume, and moving averages. I don’t want to poo on what other people do. Find what works for you.

What happened with atos ? buy or sell — psanchez

I’d rather own 1 share of $BABA than 180 shares of something trading at $1

I use screens 1st fundamental, then technical. 5 yr av ARR is 40% CROR 23%. Max DD 12.8% You use fundamentals? — Cyclentrade

Yes, I scan for both fundamental AND technical criteria. Great stats by the way! Congrats!

What helps you to make a decision on what stock is the best to buy and what indictators do you use? — CurlyTrade

It’s a blend of many things. First it has to pass my scans. Then it should be in a strong industry group after that I’m looking at the setup and where support is. If it has a good reward:risk IMO, I’ll take a crack at it.

300–400 opportunities is not actionable. How do you further narrow them down? — extrodyne

I run an “ideal growth screen” over the results. Gets it down to 70 or so. Then I’ll see what’s setting up around 10.

If you could use one and only one technical indicator as your buy signal, which one would it be? — OnTheGoTrades

A break above resistance in an uptrending stock, ETF, baseball card…

I hate scanning! Only because it looks difficult. How can you make it easier? — Scarredtradernocry

scanning use to take me hours every weekend. Now its a single click. I use This blog post talks about how I scan and why I run the scans I do.

What are your thought on SOUPQ? — SMXH

Is this the soup shop from Seinfeld?? If so, I love the soup, hate the stock…right now

Do you look for stocks that are going to rebound or stocks that are already bullish more often? — dakotab71199

Depends on market conditions, but typically I’m looking for consolidations within established uptrends.

Is it possible to trade successfully with using technical analysis only and nothing more? — kmodak

Sure! …anything is possible. It’s not a matter of finding the “right way”. It’s a matter of finding the right way for you.

Whats your favorite type of sandwich? — rappy

I’d go with the Bomb from Sal’s in Astoria… now I’m hungry! :-)

Do you use candlestick patterns? If so which in your opinion has the most impact on trend? I.e doji/inside day and also without giving it all away. What is your strategy on entry/exits. Which one is more important for R%? — alistair_chart

I don’t use candlesticks. Just simple Open Hight Low Close charts. I share everything w/ everyone. Here’s a video on how I do entry/exits. Check out my entire YouTube channel here.

Good-morning, may I ask what your thoughts are on TGTX. — viviennehlowe

I wouldn’t touch it here. I think it needs time to consolidate, form a proper base, etc.

@MichaelGLamothe

When you find your lead star candidates how do you enter? — MaximaTrader

I use advanced entry points that are close to support. Here’s a video about it.

Hello Good Morning! may I know your short-term views on BLDP. Do you feel MM’s may be trying to keep it down? — avanishyadav

I typically don't get involved in stocks under $10 but that's a pretty chart

@MichaelGLamothe

When you trade how much is instinctual and how much are your fundamentals? — Sur_Texas

YOU WIN QUESTION OF THE DAY! :-) I love it! I think this changes for all of us over time. At the start, we use various parameters and rules to help guide us we don’t have a gut yet so when we “feel” something, we attribute it to emotions… over time, that “feeling” is not just an emotion, its our experience talking to us… our gut is developing when you have some experience, I think its important to trust and develop your gut while letting your head be a check presently I am probably 50/50.

Thanks everyone for your questions, your time, and your attention. I hope this was helpful for you. :-) Hit me up anytime. There’s a lot of information on my site ChartYourTrade.com & my YouTube channel.

Great Q&A yesterday on @Stocktwits I wanted to go a little deeper on some of the questions and made this.

We hope you enjoyed this Q&A! Press the 👏 below if you really liked it and feel free to highlight or comment on any part. We also have a newsletter for anyone interested in getting daily updates about the stock market.

I am the Community Manager for StockTwits. Follow me @michaelbozzello.

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Product Manager @StockTwits | Personal trader for 15+ years | It takes passion from great people to build great products