TraderInterviews.com: Hello everybody and welcome back to TraderInterviews.com. Thanks for joining me for another show this week. We're going to be speaking with John Lee. I got in touch with him through a couple of other traders that I've interviewed, so we're going to hear from him. At lot of you probably know of him. If you don't know his name, you certainly know some of the things that he's created, so we're going to talk to him about that today, and his overall approach to trading the market. So, John, thanks very much for joining me on the phone.

John Lee: Thank you.

TraderInterviews.com: Well, let's start by talking about who are you? Where did you come from?

John Lee: I was born in Baltimore. My parents came here from South Korea in the early 1970s. We lived in a pretty bad neighborhood. I wouldn't say we were not even close to middle class yet. My mom had a restaurant, and my dad was working in construction. So, we didn't have a big fortune, or some family empire, or anything. So this really had an impact on me because the first thing that I wanted to do was, I never wanted to be poor. I never, ever wanted to literally just break my back and just work long hours each day, and for what? For nothing. You're really working for nothing; just to get by. So, that right there, even though I was really, really, really young, I never ever forgot that. Just to be a little more personal, I've seen my parents stressed out. My mom, I'd see her cry sometimes. It's so hard. So, it's something that really, really caught on for me that I never, ever wanted to be poor in my life. All throughout my life, I was searching for the best way to avoid that, to get out of that and to actually make something in my life even though I was very young. So, after that we moved to Baltimore County, near Owings Mills. It was a little better neighborhood, but still I'd say we're middle class by then. I went to a private Baptist school for middle school and high school. I had about I think 30 or 35 people in my graduating senior class. So, it was a really small school. I had no finance background or anything, but I started investing when I was 13, and the only reason why that happened was because my dad at that time, he went from construction, to general contracting, to starting his own firm. He had a lot of clients that were wealthy, a lot of rich people, a lot of multimillionaires. Every single night, he would bring home bags of annual reports and magazines like Business Week and Forbes. He would just bring them home every single day. At that age, I really can't say I was really interested in that stuff, but after a while, if your father brings home that stuff every single day, you're going to start reading it. So, I got very interested in stocks. I never will forget what my dad told me, around when I was about 12 years old. He said, "John, go ahead and read all this stuff, and read as much as you can because this is how rich people get rich, and they all just read this stuff and watch TV all day." Which I assume is CNBC.

TraderInterviews.com: Not Oprah.

John Lee: Of course, I have my own comments on CNBC, but we'll get to that later. So, my dad opened up a brokerage account for me when I was 13. And I didn't do too badly, but I didn't do too well either. It was pretty much a break-even for a few years, obviously. I didn't even get to trade as much. I'd say I was a long-term investor. I didn't even know what I was investing in. So, that was my exposure to stocks early on. And it went on like that from middle school to high school. Then from high school, late 17 turning 18, that's when things really started to change. After high school, I went to Valley Forge Military College. After two years, I transferred school. I've had a two-year ROTC program that's in Wayne, Pennsylvania. I had a real interest in going into the military. Right after high school, I signed up into the military, then I went to the academy. So, it was a really good experience. I have many, many stories to share which is going to take too long, but suffice it to say that it is true when people say that you learn discipline, you learn how to organize your life, your schedule and everything. It's all true. No matter how hard it is, no matter how much I hated it back then, I cannot ignore the fact that my two years over there significantly helped me just boost my trading career. I started trading when I was 18, when I finally got my own account, when I was able to trade on my own. I actually had a bunch of money saved up. My parents, they did not believe in debt. They always saved my money. Whenever I got money for my birthday, or Christmas or whatever, I'd see it once and then they would just take it away from me and just put it in the bank. I would never see it again. I got so frustrated because I couldn't spend it, and then after I turned 18, I realized why. I'm very thankful for that. I'm glad that I actually had money to trade because it's really hard to trade if you don't have enough capital. If you're undercapitalized, then you're really kind of shooting yourself in the foot where you are prone to make more mistakes. For example, you might use your entire account for one position or something. Both of us know that you can't do that. With a longer-term scale, you will most likely fail in that endeavor. So, I had a bunch of money saved up. I was still reading those annual reports. Then I came across this book. It's "Stikky Stock Charts" book. And you get to draw these trend lines really simple. You get a ruler, and you draw them. I was like, "Hey, this is really cool." Because I'm a very visual person, I do not like reading annual reports. I love reading, but I'm not very good with math. I'm not very good with numbers. I'm not very good with statistics or any of that stuff. So, charts really, really appeal to me. This was when I was in my first semester; I was a plebe at the academy. I didn't have a lot of time to go through the charts. But I had the discipline to go through them for a few hours a day and on the weekends. There were no girls there because it was all male. So, obviously, I had a little more time to study them and so that continued on. From that point on, I read or I do read at least 100 books on business or finance or trading or whatever every year. I did that for four years straight. 2009 was the first year I didn't do that, but I'm not going to cry about it. Another thing I do want to say is that the reading, all the books that I've read on all the topics, I got so much exposure from all these different styles, other different things that these other traders were doing because, obviously, I didn't have a trading mentor. I didn't have some rich guy who's been trading for a long time telling me what to do. So, I had to learn everything on my own. The books were my mentors. These authors who I didn't know were trying to teach me something. So I relied heavily on these books. Because if you look on my blog, on iBankCoin, on the Chart Addict, a lot of people ask me questions on how to do things, and it's really simple. I learned everything what I have right now, I learned from books, and it's really simple. If people picked up a few books and actually studied them, their questions will be answered. So I've been doing that. I've been trading for those two years then I transferred to the University of Maryland. I studied economics, which I hated. And then I went ahead and I actually started a private fund with some of my dad's friends and family members, and some other acquaintances. I started with $50,000 and now I have a few million under management now, full discretion. And the way I've traded that is the same way I do in my personal accounts somewhat, except I don't day trade. So that was pretty cool. I'm still doing that now. The way I trade is kind of different, I guess, from most people. Because the way I trade is I trade very, very simply. If you watch my StockTwits TV shows, or follow me on my blog, or all my trades, or my charts, you'll notice that all I use is pretty much price, volume, moving averages and trend lines, and that's about it. I don't use technical indicators. I don't use Fibonaccis. I don't use complex algorithms. I don't use any of that. Because the market itself is so complex and so difficult already that there is no reason for me whatsoever to complicate it even further. You see what I'm saying?

TraderInterviews.com: So, of those books that you read, let's go back to that for just a second.

John Lee: Yes, go ahead.

TraderInterviews.com: What strategies did you try? Did you try all of them? Did you try a few of them and then pick the ones you liked best? How did you basically start just to get the strategy you have today?

John Lee: The first thing that I needed to know was what kind of trader I was. I mean, I was dabbling with swing trading, day trading, scalping, intermediate-term trading, I was doing all sorts of stuff. I was trading penny stocks, large caps, you name it, everything. Then I narrowed down the focus. What my philosophy right now is, "How can I make the most amount of money in the shortest period of time?" Of course, that can be day trading or that can be swing trading. It all depends on the general market condition. It depends on the individual plays that are available at the time. There are many different factors. But my philosophy is, "How do I make the most amount of money in the shortest period of time?" I tell my readers and my viewers that I would rather want to be right and sacrifice some profit than trying to get it early and maybe guess if I'm right. I always wait for confirmation. I want to wait for that confirmation with the volume, the price action. I want to be right. I don't want to be wondering, sitting there waiting to see if I'm right because then you add on more risk, then your odds of success decrease, and why are we trading in the first place? We want to be right. People say that they want to trade because they want to make money. You have to be right first. Money is just the end result; it's the reward for being right. So, in order for you to be right, you have to get your system down. So, for a couple of years I have developed my system. I've been playing gaps; I've been playing parabolic movements both up and down, long or short. I've played spikes. I've played many different things, support, dip-buys, and all sorts of stuff. One word of advice that I would give to people that are listening is that you cannot just blindly follow other traders. You cannot do that because we are all so different from each other with different backgrounds, different circumstances and situations that you cannot follow people. I encourage everyone to develop their own system. Whatever they want to do, whatever is most comfortable for them, they should go ahead and do it. I see too many people on Twitter following too many people versus developing their own style. So it took me a few years to develop my own style and it constantly evolves. It's not written in stone. I'm still developing it as the market evolves. So that's another thing, the market evolves all the time; therefore, you need to evolve as well because if you're using a strategy that's working right now the market changes, you cannot use that same strategy or else you will suffer some major losses. So, I've been doing that. I'd say that right now, I am a primary day trader and a swing trader. I do hold intermediate-term positions, but not that many. I am not a long-term investor. I don't trade a lot of commodities, such as oil or gold because they are more influenced by some of the more macro international factors, things that are beyond your control. I've got to focus more on individual plays. I try not to focus more on the general market even though the general market is important, I focus exclusively on the individual stock that I am pretty sure is going to breakout or breakdown if I want to be short and I just completely focus on them.

TraderInterviews.com: The ones you break, the breakout or breakdown, you said that's your kind of bread-and-butter strategy?

John Lee: Right. I do a lot of breakouts, a lot of breakdowns before they occur. So the way I do that is I catch the breakout intraday, and I use the daily chart, the multi-month daily chart as the exit points. So, I want to be right. I want to have buffer room, so I don't have to worry whether or not the breakout's going to fail. And of course, sometimes they fail, they fake out on you, but over a period of time, you're going to be playing enough breakouts that you will be consistent, and you will get a consistent return month after month.

TraderInterviews.com: Can you talk about a recent trade you've had that demonstrates your overall strategy?

John Lee: OK, sure. Let's see, in 2009, if you look in my archives, there are trades from March until the end of the year, which I've profiled. But let's say, today alone I traded PCBC, GENZ, CYCC, which was up over 150% today; FEED, LEN, VVUS, and BBBY. So, BBBY and LEN, those two were morning breakouts. What I did was I always, in the morning, look for the pre-market volume movers. Anything that gaps up above the resistance on the daily chart that's priority for me, I will focus on them. And then throughout the day, I'll scan for more stocks. And the ones that do breakout above resistance or are testing the highs of the day, I'll also play them as well. So, you have a lot of momentum plays, you have a lot of breakout plays. And almost every single day, you will find something, at least one thing that's going to make you money.

TraderInterviews.com: We'll finish up with this. How do you think, like the Twitter and StockTwits has that helped a lot of traders or do you think it's hurt a lot of traders because there's a lot of noise?

John Lee: Oh, I think it's helped a lot because I wouldn't say Twitter in general because Twitter, there's a lot of people out there saying a lot of different things. I've personally called out many, many people, called them out on a lot of stuff, and they can't really get back to me on that. But on StockTwits, I do my TV show, "Charts Gone Wild." I started that in I think the end of September or early October. I got started on Twitter back in March or April of 2009. But I could say that there's a huge community out there. There's a recommended list. After a period of time, you can figure out who's good and who's not. So, if someone's new to Twitter, they can follow a bunch of people, and then watch those people closely, and then start weeding people out, and then figure out who's really worth it, who's not, who's being mentioned a lot for their trade, who's actually posting real-time trades, both entries and exits? There are a lot of people that post entries that do not post exits. You got there a lot of games being played out there, but you've got to do the homework, figure out who's good and don't be embarrassed, don't be shy, ask them questions. Try to get some help from them. If they're really good, decent traders, they wouldn't be so stuck up and not be willing to help you. I do enjoy helping people. I first started blogging in August of 2008. I started my coaching program in November of 2008. I have a core group of about 15, 16 traders that trade with me every single day. So I've got to help them a lot, the readers a lot. So, it's a really good thing. I love helping people. If anyone needs help, I'm willing to help them only if they're serious. I mean, Tim, I'm sure you know that there are a lot of people out there that want to learn how to trade, but just a few people are committed, really, really committed to learn. Some people are thinking of it as a hobby. That's wrong because it shouldn't be a hobby. It should be a business. It should be something serious. It's not something on the side that you can just do whenever. So people that treat it very, very seriously that seek the help of mentors, coaches, people that know how to trade, and then they follow up and they do their own work, they figure out what they want to do. And then you put all this together, then you have no choice but to be more successful.

TraderInterviews.com: All right. Well, where can somebody find out more about you? I think you mentioned your blog already. Where can somebody find out more and follow your trades?

John Lee: I am "The Chart Addict" at iBankCoin.com. I'm the co-owner of that site. I'm also "WeeklyTA" on Twitter. That name came from the very first blog I started on Blogspot, which is "Weekly Technical Commentary." Back when I started, I thought that I was going to just blog once a week, hence the name "Weekly." And that quickly did not work out, as I had to blog every single day. And also, I'm available on several instant messengers, my email. But they're available on the site. So, if anyone wants to contact me they can go ahead and do that. I would be more than willing to help.

TraderInterviews.com: All right, great. Well, John, thanks for your time. I appreciate your sharing some of this with us. And listeners, go over to John's site at iBankCoin.com and check him out. Thanks a lot John.

John Lee: Hey, thank you.