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trading advice


i also came across this of late but dont know who to attribute it to:

My best advice:

1. Do not trade all day. Trade the first 90 minutes or so. Many of the best opportunities happen in the morning while price discovery is taking place. If you must trade to the close, come back for the last hour! I personally find that after making a number of good trades in the early part of the am, if I continue to trade its often a case of getting stuck in the chop and giving back the easy money made earlier. Its just not worth it.

2. Limit the number of trades you do. Teresa Lo limits herself to 3 and rarely breaks that rule. She has a ton of discipline. I wish I had inherited her discipline much earlier in my trading career. That one step improved my trading tremendously. If you know you only have three stabs and then you are out, you aren't going to waste them. Trust me on this.

3. Know what you are trading. No one, in real time, can be master of all setups and trading styles. Until you can be consistently profitable day trading, I would pick one or two setups and only trade them. You may go all day without having a single setup appear (unlikely) but if thats the case, don't do it. Even now I have only two primary setups - test

4. Get your mind around why overtrading is happening. If you can quash that "problem" (I believe it to be, been there done that) you will probably succeed in enforcing the discipline required.

Position and swing trading is much easier, in stocks, IMO. You have time to contemplate your moves and are not under the real time gun. You might even question why you want to day trade. Some people I think switch to day trading just to get an adrenaline kick, when in fact they might be far more successful as position traders.

There is something very appealing about getting all that time back. Using only end of day data, orders transmitted at the open, you then get the day to yourself to do something else.

I switched to day trading futures some time ago and do not day trade stocks at all, much to my (stock) brokers disappointment I am sure. I have never looked back - futures allowed me to focus on improving my trading, not trying to find 'the' best stock(s) to trade on a given day.

Just some musings. Oh, a final comment. I believe a person makes it as a trader when the act of trading becomes boring. I tell ya, sitting all day waiting for a setup to happen along is boring!

:) mw
Who is/was your mentor bullrun?
Originally posted by day trading

I agree with everything that pt_emini has said.

I would add that you should also understand (and experiment/test) how different money management strategies will yield vastly different results on the same trade setups. For example, giving yourself a 12 tick stop instead of an 8 tick stop could change a losing strategy to a winning one and vice versa.

Charting platforms are difficult to recommend. I use eSignal and think that it's the least of all the evils. eSignal is one of the pricier ones but comes with a certain amount of convenience. TradeStation is more economical especial if you use them as a broker and you are trading live money. If you're still paper trading then I'm not sure if they are more economical. Can you program or write simple scripts? Then that might influence your choice of charting platform as you will be able to modify indicators that you can use. eSignal uses a super-set of JavaScript while TradeStation uses a proprietary language called EasyLanguage.

You might also want to look at Ninja Trader. They are a trading platform but have recently added charts to the mix and use the built in .NET language of C# which is very convenient, powerful and fast. If you just use their simulation software then I think that you might be able to get their trading and charting for free while you're paper trading. Let us know how you go on that one if you try them out.

This was extremely helpful. Thank you.
my best slogan is Invest only what you can Afford to loose in futures. it gives high returns but high risk as well, if you are ready to loose money then you can earn more as you can play wisely then
I used to trade all day. Then I realized that I get lazy and give money back in the afternoon. How do FOREX traders day and night? Maybe I'm just getting old.


"At all levels of play the secret of success lies not so much in playing well as in not playing badly."