99% of day traders won't make what a "Good" swing or medium term swing trader can make on yearly basis, The amount of commissions Retail makes hurts big time, the first 100-120% of what a day trader makes goes to fees, this alone is part of the 95% who fail, the other 4% have learned to make consistent monies, but too often still retail and making less than 500k a year, they still have hurdles of putting on size. Once you get into 1% you leasing/owning a seats, might have a staff, you have to be doing volume to get better pricing, nickels adds up to huge money. This is based on my experiences trading and owning a brokerage long ago for thankfully just a year-I simple don't like dealing with the public..., but I have talked to many brokerages through the years as well, nothing changes, cause people for most part are lazy and computer dumb. Another aspect that many don't take into consideration is loss of wages and bennies that swing trader is making, if they are making 100k plus health etc, day trader unless disabled or retired has to cough up health insurances, dental, pay his own vacation and losses on sick days, doesn't have 401k that company matches. So the 95% that lose, lose much and then some and the 4%-some of them might be coming out below than working for a company. Many don't consider quality of life and loss of quality of life, if you do learn to find the Gold Ring, trading becomes all encompassing of your life, always trying to become better, and if you never able to push volume....you can lose your life or lose the other fun activities in life. Many simple don't realize what you have to give up. You learn how to make it and then start sliding backwards so you can experience life, or be rocking in a chair dribbling yelling out where is my green jello.
Gambling? if everyone used negatives, than there wouldn't be positives. Its just called business. Day trading is plagued with bumps on the road and so is position trading. every venture we undertake requires research. day trading and position trading are the same in regards to quantity of research. since 2008 I've read years of complaints from day traders whining about loosing their money later in the day after winning in the morning. one of the many elements required is to pick a time period or shift to trade. fresh eyes are required and that comes from breaking away from the job. I found that after a vacation I am on top of my game and that comes fresh eyes.
yes, so now all we are bitching about is time. How much time should I bet on? And am I betting for just my short life or my childrens and grandchildrens lives? Or man kinds life? Or just until the rent is due? Time is everything. And it would be so much easier if we knew how much we have to work with. Give me enough time and I can rule the world. So taming time into something relative becomes quite a challenge.
If you can capture a certain % in a shorter timeframe...then that's better...because you can churn those revolutions faster -- for a greater compounded return. ...kind of like a Formula 1 engine/race car. -- to make an analogy....it runs at 18K RPM. Contrasts that with a regular BMW road car...the F1 car can run laps around the track around the road car.
Trading is personal we all seek our own level of perfection. (For me, this was one of the many big beasts to contend with).
where it gets crazy is when you have a certain number that you think is good. Then what do you do when you have exceeded that number? Now you are in no mans land. Holpefully your long range trading plan has accounted for outliers which far exceed normal expecations. But most likely not, and then you are just trading by the seat of your pants with no clear plan. And make no mistake about it, you need those long shot outliers to make the small conservative crap you do every day to pay off. After a while, the whole thing looks like a casino, and you realize in the end if you play long enough, eventually they will get you. If you accurately analyze the cost (namely commish and spread) how could it be otherwise?
Your chart is awfully convenient for swing traders, most charts don't look like that. The benefit of daytrading is that while the open and close of a trade can be the same or almost the same, the high and low difference is always bigger, that's the profit potential.
Forgotten to mention that I did an analysis of lifestyle considering also some critical factors such as return per man-hour (watching the screen whole day, EOD, etc), tail risks (overnight, weekend, etc), capital employed (stock, futures, options), etc. A high return does not guarantee a high return per man-hour!
As an intellectual exercise one can reduce all thinking about trading to math. A simplifying assumption is that all trading schemes are fractal: they will work the same on any timeframe. If that is true then it can be shown that gains increase exponentially with shortening of the timeframe: gains from each trade fall but the total trades increases. The limiting factor becomes transaction costs, at some point faster trading will be less profitable. In reality the fractal idea doesn't play out because the causes for taking trades differ over timeframe.