Five Advantages to Day-Trading with a 90% Win Rate

Five advantages to day-trading with a 90% win rate offer a tempting opportunity.

The five advantages to using the Pick of the Day advisory service give its participants a high probability of success with each attempt. The limited time required to use the Pick of the Day service is compelling but the other five advantages provide additional incentives.

DayTradeSPY’s Pick of the Day is intended for traders who lack the time to watch the market or stare at charts all day. The pick typically is sent to the inbox  of subscribers each trading day by 9-9:15 a.m. ET, said Hugh Grossman, founder and senior partner of the DayTradeSpy Trading Room and the Pick of the Day.

The advisory service offers an alternative to the market volatility that can come from longer-term equity investing. As geopolitical risk rises amid Russia’s unrelenting invasion of Ukraine and the Middle East conflict widening in the wake of the murderous Oct. 7 attack of Israeli villages by Hamas militants who invaded from neighboring Gaza, the short-term nature of option trading is gaining increased interest, Grossman told me.

The DayTradeSpy Pick of the Day bases its recommendations on the SPDR S&P 500 ETF Trust (SPY), a highly liquid and diversified exchange-traded fund (ETF) that follows the top 500 stocks in America. The fund is familiar to many investors due to its sheer volume, and is resistant to market manipulation, Grossman said.

Hugh Grossman leads DayTradeSpy Signal, Trading Room, Pick of the Day and Ultimate Training Workshop.

The Pick of the Day has an almost unbeatable win rate, said Grossman, a seasoned options trader and trainer who founded DayTradeSpy Signal, the Ultimate Training Workshop, the Pick of the Day and the Trading Room advisory services. After years of analysis, Grossman determined that the market will usually deliver on a directional trade based on its breakout beyond a support or resistance level on a five-minute chart. Once the SPY fund closes outside of either of those levels, there is a high probability that a the goal of a 6% gain can be reached fairly fast, he added.

“In our live Trading Room, one of our early tasks is to establish those short-term support and resistance lines,” Grossman said. “Then, as SPY trading opens, we watch price action, triggering a trade when the price closes outside that tight range. We immediately put it up for sale for a 6% profit target.”

Five Advantages to Day-Trading with 90% Win Rate: 1. Follow the Leaders

The Pick of the Day is day-trading SPY options program designed for those unable or unwilling to do the research.

“My cohort, Ahren Stephens, and I do the heavy lifting every morning as we analyze markets, Grossman said. “We examine the underlying fundamentals, combined with deep dive technical analysis, to present to subscribers our Pick, a particular option on SPY.”

Ahren Stephens co-heads Pick of the Day and the Trading Room.

SPY fund tracks the top 500 U.S. stocks. This is a high probability option we look at buying at market open.

Five Advantages to Day-Trading with 90% Win Rate: 2. Quick Profit Potentials

“The Pick is anchored in time,” Grossman said. “The idea is that markets go up and they go down; our objective is to determine the highest propensity of movement on the stock that day.”

Subscribers receive the Pick of the Day via email before the market opens, allowing the purchase of SPY shares soon after the opening bell, Grossman said.

“Specifically, wait a few seconds for the bid/ask spread to settle in nice and tight to with 2-3 cents, then check to see if the pressure on the stock is going in your direction using the one-minute chart,” Grossman said. “If, say, the option is a call and the stock is pushing to the upside as a green candle, buy right then.”

Five Advantages to Day-Trading 90% with Win Rate: 3. Candles Light Way

Candles measure price action within a specific time frame. In a five-minute chart, each candle represents five minutes of time. If a candle is pushing down, wait for the turnaround to obtain a better price, Grossman advised. Plus, always use limit orders, he added.

On a green candle, the price entered at that point in time at the bottom of the body, bounced up and down to the top and bottom of the wick, or the tail, then exited the five-minute segment at the top of the body. On a red candle, the reverse is true, with the price entering at the top of the body, exiting at the bottom of the body, Grossman explained.

“We can determine much information from this price action,” Grossman said. “This is very common with traders and is watched profusely.

Five Advantages to Day-Trading with 90% Win Rate: 4. Avoid Greed

“Immediately upon your purchase, put it up for sale with a 6% gain,” Grossman said. “We use 6% as a standard by which to measure success, a target that most, even novice traders should be able to achieve. More experienced traders, especially those in our morning Trading Room, tend to cash out with greater profits simply by paying attention.”

Many of our traders reap double digit gains on these picks. Upon entering a sell order, we like to use Good till Canceled’ limit orders. The odd time, you may have to hold overnight.

The Pick of the Day usually delivers fairly quickly, often within the first few minutes. As an example, on April 22, the Pick of the Day was the $498 puts, expiring this Friday, April 26. The average buy price within the first two minutes was $3.96.

“Add 6% to that for a sell price of $4.20, and the market hit our target by 9:35 a.m., a mere four minutes later,” Grossman said. “Where else can you earn 6% in 4 minutes?”

In the unlikely event the option does not sell the same day, they are designed to be held overnight, if needed.

Five Advantages to Day-Trading with 90% Win Rate: 5. Infrequent Losses

“By picking options with further-out expiration dates, we experience relatively lower theta loss,” Grossman continued. “If, for some reason, the sell order fails to deliver within a couple days, the trader may wish to look at its viability, consider whether the stock will come back organically, whether a repair is in order or if it is best to simply let it loose. This does not happen very often.”

But, as with all programs, a loss does happen from time to time. The advisory service incurred a few losers in the last month, “a rarity,” Grossman said.

“On an annual basis, the Pick of the Day is about a 92% success rate, which is considered excellent in this industry,” Grossman explained. “As with all programs, the trader must exercise good money management techniques, including only trading with funds they can afford to lose. As you know, there are never any guarantees.”

The recent losses were a result of misjudging the market forces, Grossman said.

“In particular, the recent Middle East crisis with Iran striking Israel proved costly on the stock market due to a threat of rising oil prices, which leads to higher inflation and lessening the Fed’s inclination to reduce interest rates anytime soon,” Grossman continued.

Erroneously perhaps, the duo “miscalculated the normally positive impact” that the current earnings season may have, since it ended up overshadowed by the recent higher inflationary indicators affecting prices, Grossman told me.

“Regardless, longer-term trends have been astonishingly positive for the Pick of the Day,” Grossman continued. “Let us do the extensive premarket analysis. Unless you are busting out at 95% wins on your own, the Pick of the Day may just be what you need. It’s a simple ‘buy it, set it for sale and forget about it’ trade, returning later to claim your gains.”

When following other investment gurus in his early years of trading, many would claim success if the stock went up even a couple cents, Grossman said.

“In my reckoning, that would have been a dismal loss as I would never have sold it for a couple cent gain,” Grossman said. “It’s just not realistic.”

Economic Outlook Assessed

The Wall Street Journal published economist Mark Skousen’s report on gross output (GO), entitled, “Slow GO May Mean a Recession Soon.” It was the fourth time in the past 10 years that the Wall Street Journal editors have published Skousen’s reports on GO.

In this report, Skousen, leader of the Forecasts & Strategies investment newsletter, noted that GO rose by a tepid 2.4% in real terms last year. In the fourth quarter 2023, real business spending declined 0.3%.

Government and consumer spending continue to rise, but business – a leading indicator – is trending downward.

Ben Franklin scion Mark Skousen, who heads Forecasts & Strategies, talks to Paul Dykewicz.

U.S. House Advances Foreign Aid Bill 

The U.S. House advanced a foreign aid package of $95 billion for Ukraine, Israel, Taiwan and humanitarian support on Friday, April 19, clearing a procedural hurdle to hold final votes this weekend. The vote gained unusually strong bi-partisan support in the House, as Democrats helped Speaker Mike Johnson, a Republican, gain a decisive 316-94 margin. Final approval could be given by the House this weekend, allowing the package to go to the Senate for approval.

Meanwhile, the Middle East conflict keeps raising risk, while Russia keeps waging war against the civilian population of Ukraine. In addition, the current market mix of economic news is pushing stocks down as Fed Reserve members delay plans to cut interest rates, Grossman said.

“One would think positive bank earnings would prop up markets, but then SPY hits a major Fibonacci resistance level, falls over the edge, motivating other investors to bail out like rats jumping off a sinking ship, all while a former president takes the stand on hush money paid to a stripper… all before lunch,” Grossman said. “You can’t make this up.”

Income investors willing to try the DayTradeSpy Pick of the Day and Trading Room have recourse to the negative news that can hurt the market. Trading options in SPY is a proven way to limit the market risk, Grossman said.

Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, Guru Focus and other publications and websites. Paul, who can be followed on Twitter @PaulDykewicz, is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Special Sale! Paul is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. The uplifting book is great gift and is endorsed by Joe Montana, Joe Theismann, Ara Parseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many others. Call 202-677-4457 for reduced pricing on multiple-book purchases.