Patience is a virtue lost on the young trader at times. The market is all about watching and waiting. If you find yourself on the short-end of the stick, or you’re just wondering how someone like John Carter made a million dollars in one day — read on and learn.

John’s one million dollar Tesla trade is something that can, and more than likely will, happen again. If you’re on the right side of this trade, you could be sitting pretty.

But here’s the catch —- how do you know when a trade like this is even going to happen?

For John, it was all about what’s called a pre-earnings announcement. These announcements generally peak in earnings season, which we’re currently in. For the Tesla trade, John attributes it to a tweet by Elon Musk before the market opened that day. That was the pre-earnings announcement that triggered him to think “I better watch this.” It also sent many short traders running for the hills. This foresight though, relies heavily on the fact that John has been on the other side of a big swing like this. Nothing makes you more aware of the equal opportunity dream crusher that is the market, until you’re sitting, staring at the computer, watching your portfolio tank, and wondering how you got it oh so wrong.

That’s why John wants to share what made this Tesla trade such a success. To start, a pre-earnings announcement is especially crucial to watch when it’s dealing with a stock, like Tesla, that has high short-interest. Once that announcement has happened, it’s important to look at what the rest of the market is doing. This will help determine when you should enter. Again, when Musk tweeted, it sent short traders into a short-covering frenzy. As a result, the price for Tesla naturally dropped. At one point, it was something as low as $136. John got in right around $150. It had already made a 15-point turn, which helped him determine that as long as it didn’t fall off a cliff, this thing was going to just keep ripping upward.

Now here’s where the tricky part comes into play. As an experienced trader knows, one of the biggest mistakes a trader makes is getting out too early and hesitating to get in altogether. This is where John attributes mental fortitude. Even he was a little spooked every time a pullback occurred or the volatility picked up. In this type of trade, the best thing to do is imagine you’re trading a much smaller lot (a position size that you’re used to, like a ten lot). Of course, that’s easier said than done, but it helps you to not psych yourself out and want to exit the trade for fear that it’s about to bomb. It helps solve one of John’s favorite questions, “Okay, so you’re on the horse now, but how on Earth do you stay on?”

Once you can convince yourself that it’s going to be okay, you sit on it and watch it unfold. Of course, the market is unpredictable, so there will be times that you watch as it rips in the opposite direction from what you want. But here’s what can help prepare you for things like this: the mindset that you have to earn to trade ‘bigger.’ Start small, grow your portfolio, and then you can pull out the big guns. A great way to help you achieve success is by joining our Options Membership to follow John Carter and watch his trades, as well as other expert traders.

To learn more about the Tesla trade, watch this interview with John from Chat with Traders.