Do you guys really want the secret to short-term trading?? Never, ever trust the market, it is nearly always wrong and wrong on purpose. This is the last time these words will ever cross my keyboard, and I won't explain anything. So there you go, go out and make your fortunes.
As I tell all my college students and new traders. "Trading is simple, but not always easy, big difference." So much of the info being put out is trying to convince people that they can make a zillion $$ with their PDT, $25K eTrade account. Doubtful Certainly helps the retail brokers bottom line, but as my brother always says "retail brokers simply make their customers broker" LOL. Trading, like any money making business, has to be approached with education, capital, immersion, and yes, some hard work. I can tell you for sure, that those who work harder, make more money..."whoda thought" eh? The psychology is a much tougher part of the overall trading package than the simple act of engaging in working strategies and techniques. We do our best to address these emotional issues, but it's really hard when dealing with, generally, already successful (in some field) adults. FWIW, Don
"I totally agree with Don's statement." If you trade for a long enough period of time, you will eventually find a trading system (methodology) that works. "But, getting yourself to enter every trade when you are suppose to and exit every trade when you are suppose to, is the single most difficult task for the experienced trader." You are many times entering trades into the darkness and abyss and reluctantly exiting into the light.
Wise words Illiquid. I suggest beginers build this assumption into their trading. That is, they must assume that at least 50% of their trades are going to be wrong, and that they will be stopped out (let's hope they have stops in the first place!). Once a beginner accepts this as the absolute truth, they will stop risking so much on each trade, stop averaging down and focus on the risk.
Here is the guy who knows a thing or two about markets! Love it. Short, sweet, accurate and direct description of this game! I agree 100%
I have read alot of posts here...particularly the longer threads with thousands of posts and replies... I enjoy reading the stories of the traders from the deep past especially Lefevre and Wycoff... I am trading with real money and watching the market from pre-market to after-market. I feel like I am learning a heck of alot more from watching the tape than I ever did from reading. I think I am fairly good at technical analysis on a macro level. I can see trend lines, MACD, RSI and Volume make sense to me. The first two days that I was working my thing the market was "rallying" and my "TA" was right on, I made 10% trading small lots of my "researched" stocks. As the next week began, all hell broke lose. All the patterns that were my "setups" failed. That weekend's "research" was wasted. Seemed to me that what I needed to do was focus on very active issues, 3 million or more shares trading, and catch the waves. Just watched those issues for two days...watched the fast rises disintegrate, the patterns fall apart. The next couple of trades I made taught me to make sure to take my profits when I "got the feeling" realized the feeling was "resistance". The bouncing of the price trying to rise/trying to fall and the bid/ask play are really interesting to me. Watching more now. Was in LVLT had a nice move up running, it "came off a hard bottom of resistance", moved up past the middle of the W, got in at the right time. It moves up, retraces a nice little bit and resumes a steady rise...nothing too steep and all of a sudden it starts moving horizontally....hmmm should I get out????? nahhhhh....Zoom down it goes...I hadn't moved my stop and I am out at breakeven rather than a nice tidy profit....What the heck///Geeesh....I saw it! It was there!!! Oh, the CEO of Cisco had held a press conference and predicted sturm, drang and gloom in the communications industry.... So, I am up now. Learning everyday. I just watched the last two days and had a nice trade yesterday. Am sure there will come a time when the market is trending and the TA stuff will come back into play but for now I am focusing on the tape and scalping small trends intraday on volatile stocks. Seems to me that all the stuff about "befriend the trend" and "taking what the market is willing to give" is what I need to focus on. No fear, just a smidgen of greed. Take profit leave a little on for the big bang, although not a lot of big bangs, the last 4 weeks. I try to stay out of the way of the guys, like the other day on ETFC, that closed out the day with a trade of 1.3 million shares, 3 minutes to the close. It is a fascinating thing to watch and learn from. I feel like the books would distract me. Flexibility and the willingness to accept what it is rather than what I would like or "what I know", right, like I "know" anything, seem to be what I need. and Discipline. and Experience. Maybe I am nuts and doomed to failure but everyone talks about the 95% who end up losing it all and leaving. The exact same statistics are given to pretty much anyone who goes to a treatment center for alcoholism/addiction...95% of drunks and addicts die wasted. I've been continuously sober since November 21, 1983. I think I got a shot. Wish someone could give us a 12 step trading program.... 1) We admitted we were powerless over the market.....2) Came to believe that the market could restore us to sanity?????? Hmmmm, gonna work on this... Yeah, yeah...."Sober Trading: Harnessing the Power of the 12 Steps to Bring you Incredible Wealth in just 6 Weeks!!" Then I wouldn't have to work, learn and grow in my trading....book sales...websites...newsletters....BS...
your best education is the market. Reading stuff, backtesting things, learning from others is all great, but put on a small position, regardless of how small, and see how it performs, how you feel about the risk and your emotions. This is the best way to learn, imho. P.S. one thing that definitely will kill any succesful trader is this: PRIDE! If you think there are lots of morons in the market placem be thankful ;-)
Trading is not just simply buying and selling stocks, or bonds. It is complex as it involves people reactions, and socio-economic factors which can help you to win or lose money. Just see the following links where you shall see the names of famous people who were or were not successful in trading: http://en.wikipedia.org/wiki/Day_trader#See_also http://en.wikipedia.org/wiki/Stock_broker#Famous_stock_brokers http://en.wikipedia.org/wiki/Day_trader#Famous_day_traders There are so many occupations and professions in the world. But, it does not mean that all people in them are successful or earning money. Same thing is with Trading, not all can be winners or losers. So, it may not be the question of tough or easy, it may have to do with your capability, interests and attitude plus as some say luck too.