For all you newbies that want to get into a career in trading, listen up. This was my personal experience so far. Read my story, and then read the points I will make. You've heard them before, but you don't want to listen b/c you think you are different, and it doesnt apply to you. Well lets see, I started fulltime in Febuary of '08, trading stocks, but very very quickly switched over to futures. Lost a lot of $, but learned an invaluable amount of knowledge through one or two great people. Trading as your sole source of income is pretty much impossible as a beginner. Kodos to anyone thats done it. I was living at home with my parents, and had a big nest egg saved in the bank, and I was still feeling pressured to perform. That resulted in not being patient and taking as much as 20 trades per day in the ES. Clearly i hadn't a bloody clue. Fast forward 9 months later and I'd just finished getting mentored by a really good trader. Studied charts constantly after getting 3 months of mentoring by him. Pretty much opened my eyes to a lot of things, and set me on the right path for success. After that 9th month though, I'd lost a lot of $, and was very stressed out over the fact that I couldn't control my emotions. Pyschology was kicking my ass. Couldnt let winners ride, yet I had an uncanny ability to see PA once I was done being mentored. 8 months ago I landed a sweet job where I work either evening shift or morning shift pulling in $40's base + OT. Immediately, it had an affect on my trading. I began being more patient, waiting for that great setup. I no longer rely on this as a form of income, so I'm not 'looking' for trades. I'm waiting for a setup! My winning trade percentage broke 50%, then 60% ! Thats not to say I dont still have problems letting the winners run (emotions), but I'm doing better. Soon, I was only taking about 5-8 trades per week max. Shit, some days I dont even had setups, and I sit at the computer twiddling my thumbs waiting for a trade that doesn't show up. In this environment, I've seen my frequency of setups dip as low as 2 or 3 per week. I've had to resort to looking at a 60 min chart for some trades. But thats OK ! When the setups do happen, I am very confident in my trade, and am not so quick to 'cut a winner short' as I know the potential if everything pans out. Its my firm belief that if you are looking for high probability setups in the ES.....well, if you are looking to beat the ES, there's really only a few really good setups that arise per week. Back in '08, b/c of the volatility that # doubled. But if you're looking for a high probability of winners, you need to be patient. The setups will happen, but not nearly as numerous as I'd like. You can always scalp your way to death, and maybe you'll get lucky, but it won't last. Some people say that price action is random, and there's no predicting it. With all the programs hedging, scalping, etc etc, people say its almost impossible to make sense out of direction. Well, to some degree, thats true. There's a lot of chop that makes it rough. My TF of choice is the 15 min charts. Every now and then, you'll see PA repeat itself from past occurances, and you say "hey, I recognize that pattern", and its easy money. but if you're a noob, not having a lot of screen time, you won't know it or see it. My point in this post.....its been reiterated a million times, but I figured I'd share my background. 1) you'll never make it as a newbie trader if you rely on this as your only income source. Psychology is an a$$hole. 2) Trading the ES is tempting, high leverage, low capital start-up, but it is indeed VERY hard to trade. Like i said, there's only a few times per week that there are high probability setups. (some posters will disagree with me, kudos to you if you have a system with more setups, i have not found one yet) 3) Not having a mentor is a recipe for disaster. its very tough to know what to look for, and what not to look for. Not having a mentor can take YEARS more on the learning curve, while a mentor can give it to u in 3 months or so if you listen. 4) this is definitely not a get rich scheme. I'll be up $ in '09, but its not enough to live on..... Soon though 5) If you are not confident in your setups, you wont let winners ride. A lot of guys say newbies don't let winners ride..... Well its b/c they havent a clue if it is gonna reverse on them. Having a tried and true system makes letting winners ride very very easy.
My question is what about the other part of the story: Where did you find the mentor? I think that part of the story must be very interesting. You were living at home trying to become a professional trader presumably using an online brokerage, but you must have been communicating with others. Where? Forums? I think mentoring is a wonderful thing, but someone must be very self confident to even volunteer to become a mentor, and you are very fortunate to have found such an individual.
Yes - the mentor angle is great, but what form did that mentorship take? Online forum? Neighbour who happens to be a rocking trader? I know I'd welcome the opportunity to learn from someone who's been there/done that..
Trading is somewhat like the profession of magician, insiders do not want outsiders know their secrets; otherwise it would dilute their success.
So I summarize your bottomline: Newbies! Unless you have sheer dumb luck, you ain't gonna make it. Did I get it right?
If you jump into trading as a career, relying on it as your sole source of income, without a mentor already in place, then the odds are REALLY stacked against you, IMO. Shit I dropped close to $25k before I started slowly grinding a profit. Can you survive a drawdown like that ? B/c odds are, you will have to in order to make it in this bizz Now if you jump into trading with an evening job, or a spouse that can support you, it is entirely doable. The key is relieving the pressure of 'making it'. Now finding a mentor, that is a little difficult. There's plenty of guys that want to help but finding them is a whole different ball game. I don't understand this attitude that most have on this site in which they say, "it took me so time and money to be profitable and develop a strategy, I dont want some to give up my secrets". Personally, I havent' made enough $ or developed enough of a track record to mentor anyone, but if I ever started doing very well, I'd be more than happy to help someone. I've given some people advice in the past with the little I do know, and its sad to say, no matter how much 'good advice' you'll give to certain people in regards to price action, some people just NEVER understand it. Thats the simple truth. Not everybody has the mind to understand this stuff.
I didn't say I don't agree with your advices, actually I do, but what it boils down to was what I summarized: Unless you have incredible luck finding a worthy mentor who cuts down on your learning curve, the chances for a newbie making it is very, very low. So the real advice would be: how to find a decent mentor....