The Trade That Changed Everything
Back in 2011, when I first started trading, no one told me about the power of easy money trades. The trading world is incredibly complex, and finding consistent success is even more challenging. Looking back, I consider myself the “almost never was” because of how close I came to giving up.
A year into trading, I found myself struggling. Many of my peers were quitting, exploring other career paths, and questioning whether this was the right move. I felt the pressure of student loans and the opportunity cost of not pursuing something else. But despite the difficulties, I couldn’t bring myself to walk away. I loved the environment—the meritocracy, the informality, and the thrill of sitting next to my boss watching him make serious money.
Every day, I thought, If I could just do a fraction of what he’s doing, focus on the most basic setups, and learn to size up, I could make a great living.
The Struggle to Find Focus
The problem was that I was trying to learn too much, too fast. My mentor was a phenomenal trader, but there wasn’t a structured way for me to absorb his knowledge. He executed multiple strategies, used various technical patterns and indicators, and managed several trades at once. Watching him, I was turning into a trader of all things but a master of none.
Anyone who has been through this knows what I mean. You study, review, and put in the hours, but the results just aren’t there. It wasn’t until a particular trade—one that I now call my career-saving trade—that everything clicked.
The Career-Saving Trade: A TSLA Exhaustion Gap
Ironically, the trade that changed my career involved shorting TSLA—one of the greatest growth stories of all time. This was well before all the stock splits, and the setup was an exhaustion gap. It’s the kind of setup that only comes around a few times a year, similar to what we saw with SMCI in early 2024.
This pattern was a core strategy within my trading group and one of my boss’s biggest strengths. I had spent months studying and databaseing it. When the opportunity presented itself, I knew I had to execute. This setup was slow-moving, allowing me time to think through my strategy with my boss beside me. Like a poker player with a low chip stack, I went all in.
That trade worked. It gave me the confidence I needed to push forward. I realized that a few great trades each year could make my career—if I could stick around and keep playing the game.
What Makes an Easy Money Trade?
So, what did easy money trades look like for me? Two setups stood out:
- Exhaustion Gap Pattern:
- Strong breakout day or an earnings gap-up to start the trend.
- Followed by euphoric continuation over several days.
- A grand finale capitulatory exhaustion gap-up day with a euphoric opening drive.
- Order Flow Off the Open:
- Particularly on days like Quad Witching.
- Looking for major tech names or blue-chip stocks that deviate significantly from broader indices.
- Identifying stocks that suddenly move out of sync with the market despite no news catalyst.
At SMB Capital, where I later started advisory work, I emphasized these easy money trades more than anything else. Why? Because I truly believe they provide the fastest growth path for beginners and intermediate traders.
The Importance of Easy Money Trades
- Consistent Singles in Slow Months:
- Trading has natural slow periods. Having a reliable setup to generate consistent P&L ensures financial stability.
- Rebuilding Confidence During Drawdowns:
- A solid playbook of easy trades helps recover from setbacks.
- I discuss this in detail in my drawdown recovery video, which I highly recommend.
- Compounding P&L for Big Swings:
- Easy money trades build a cushion, allowing you to take bigger risks on A+ setups.
- If you’re up $20K in a month, you can afford to risk more on a high-confidence trade.
This mindset transformed my career. By my second year, I went from making no money to having a $10K month, then $30K, $50K, and soon breaking six figures per month.
The Key Traits of an Easy Money Trade
For me, an easy money trade has these characteristics:
- Slower Moving: Allows time to analyze and execute.
- Occurs Regularly: More reps mean more opportunities to refine execution.
- Defined Risk: No unexpected volatility, trading halts, or overnight risk.
- High Win Rate: Helps build confidence and maintain steady profits.
One of my favorite setups is the Bouncy Ball Setup:
- An in-play stock makes an initial leg lower.
- Weak bounces create lower highs against a key support level.
- After consolidation, short the break of support.
- Stop above the support level, then trail it lower.
The beauty of this trade? It’s slow, clean, and highly replicable.
Scaling Easy Money Trades the Right Way
One common mistake traders make is not scaling their easy money trades gradually. Too many traders focus on home run plays before cementing the basics. Think of it like basketball: easy money trades are free throws and layups, while A+ trades are buzzer-beaters. Would you bet more money on a layup or a buzzer-beater?
I’ve seen traders make this mistake over and over. They recognize the trade, execute it well, but then under-size it. Meanwhile, I’d be trading something liquid like NKLA, pushing size, and making $20K, while others made $500 on the same setup. They had done the hardest part—recognizing and executing—but left easy money on the table by not sizing up appropriately.
The Takeaway: Master One Trade First
If you take nothing else from this, remember:
- Master one easy money trade before diversifying.
- Build confidence through consistent singles.
- Gradually scale your best setups.
- Use easy trades to cushion risk and take advantage of bigger opportunities.
Bruce Lee said it best: I fear not the man who has practiced 10,000 kicks once, but the man who has practiced one kick 10,000 times. Focus on one setup, master it, and then expand. That’s how you build a sustainable and successful trading career.
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