learn how to play chess with the "dark side" ( whale ) as they always want to crush and destroy the little guy ( minnow ) www.youtube.com/watch?v=anvRFJFUnRE
BP, I hate to be a wet blanket BUT, why do you want to trade? It is THE most difficult profession in the world. Unlike a small business startup, where you could lose the money invested in a matter of 2-3 years, (which is the average timeframe for a small business to fail), you can lose everything in a week, not because of market conditions but because of your inabilities and deficiencies. Are you dissatisfied with your job? If you are, this would be one of the worst mental states to be to start trading. The absolute worst mental state to be in is, "my unemployment is running out and I don't want to go back to work in the field I was trained in". A sure recipe for financial and personal ruin. It is amazing to me how many folks fall for the "glamor" of trading, they go to a Wizetrade/Woodies/Bolze seminar or some Guru who states that their stops are 50 Tick and their profits are 5 Tick and believe that all you have to do is turn your computer on and 100 dollar bills will come out of the C/D drive. So here is some hardcore advice, don't even try it unless you have the following. 1. 3 years salary to live off of while you learn how to trade 2. At least 50k to get started trading with and be in a position where the loss of this money will not effect your life style 3. Trade only the qqqqs look at them every day, day in day out, do not trade Indv stocks or futures. 4. Avoid using the margin available to you, this is different than having a margin account 4. Use simple support resistance, floor pivots, and the simplest indicators. And realize that odds are against you and you will lose this money. Sorry to be the black cloud of death, but this is the reality. The Ever Strongly Disagreeing With Loki VIPER
Basics. Learn: support/resistance, a trend, range, congestion, and choppy market. Learn to trade in range, range breakout, trending markets, and patterns using support & resistance for entry, stops, targets. Be patient, avoid congestion n choppy markets (can be traded but trickier,therefore, riskier and not as profitable in my opinion). Try different indicators, style, time frame to see what works for u. Experience is king. Its not experience if u dont learn from your mistakes. So be flexible and learn from them. Take profits when u have them because u will not know if market will keep going your way but the profits will be locked in if u take them. If your doing bad, take time off. If your doing really well, take time off. Bad trading = emotional/stress = worse trading. Good trading streak = ego = bad trading. All this stuff is probably in the advice section of the books u r reading but u wont truly understand them until u experience it. You read about it and its in the back of your mind. Then it happens and your like oh...so thats what it means.
If you can learn from your mistakes and apply the lessons, it'll be difficult to fail. For each unprofitable component of your trading method, it'll take a few bad trades before you identify the mistake. Then it'll probably take a few more bad trades as you make the same mistake anyway because you're still rewiring your psychology to apply the new lesson you've discovered. Eventually, the pain and frustration and introspection from making the same mistake repeatedly will drive you towards doing the right thing. You'll give it a chance and see that it made you money or at least kept you out of a bad trade. After that, you'll probably go back to making the same mistake a few more times out of impulse, then get frustrated and do the right thing. Eventually, you start doing the right thing more frequently than making the mistake. This cycle will then repeat with the next poor component of your method. After a while, when you've been through enough of these cycles, you'll become profitable. If you've kept a trade journal, you can then apply the cycle to aspects which need improvement. Hopefully by this time you'll have so much practice applying new lessons that you won't have to go through the same psychological pain. Down the line, as you learn more about yourself and the sheer amount of opportunity in the market, you'll probably rehaul your trading method. Your current style yielding a profit factor of ~2.0 will seem painfully naive. You become more aware of how much you don't know, which is a tremendous step. Yes, you'll probably be able to pay your bills by this time, but this is where the real exploration begins because now you have basic exposure and experience with market mechanics and you know the mental games you play with yourself. You know your strengths and weaknesses and what type of trading maximizes the former. There is only one thing I'm sure of in trading: If you can learn from your mistakes and eventually apply the lessons, you WILL succeed.
These guys have been trading for a long time and have some nice free videos on Youtube going back over a year. They show losses and profits. http://www.youtube.com/user/sgomez858
5 - 10 years is about average from what I have seen/heard + my own experience. I have heard of others getting profitable in a year or two but they are by far the exception. The other consideration is how much MONEY you are prepared to spend - most of us have had to lose some money in order to learn how not to lose money
Not always true. A lot of traders are humble enough to realize that they owe a little payback / payforward to all of the others that have helped them over the years. And the traders that help others develop a much higher level of skill. It is the act of "sponsoring" like in AA or other self-help groups - the teacher learns as much as the student, if not more.
thank you for your insightful posts. What happens after this? Is it only scale issues and psychological problems that limit the riches? Just thinking about why there are not so many billionaire traders.