Is Daytrading Right For You?

[torero]

So if you understood yourself and cannot control your emotion, how or what did you get your trading change for the better? I see these 2 problem intertwined.

Here's the example, shrinks identify the problem and make that known to the patient. But that's the first step, the 2nd step is to change the behavior to get rid of the problem because recognizing oneself is not enough.

[weiwei]

lol, Torero, You are one step ahead of me. that is why I said there is more on this post.


But, I have to said, understand in here means understand one's current status totally, then one can make a better choice.

for example: one might not have a problem, but do have limitation on an area. Or the problem can not get rid of, but can be contained. As one dig deeper, all of suddent, there are many many options.

In college, if one do not do well in math, he/she usually will not try to be an engineer or any major that requires a lot math courses. But he/she can still get an degree in other area.

I believe one who has better understanding of the complete picture, and know the necessary steps to take to get there is the one who will have better chance to be successful in life, not just trading.

The way I look at it is that trading is like getting a college degree. there are many courses that one have to learn and many exams one have to pass to move on to next class. Then when all is completed. You will be awarded with a degree.

But unless you get all completed, you will get none.

What makes hard in trading is that there is really no clear way to do it. No one is laying a course outline for you. You are pretty much on your own, and have to figure out every thing out yourself. And that is what makes hard in trading. So many options and one can easily get lost with all those choices.

I will discuss more in next post.

[weiwei]

I have discussed about Internal and external factors regarding with trading. this one will be on the exernal factors that traders have to deal with.

To make it sample, it all come down to this.

One must be in good harmoney with his/her surrounding.

Reason is sample, you do not want those external factors to distrub you to a point that you subconsciosly take it out on the market or lost your focus during trading.

But some time, things do happen. then knowing how to deal with it is the key to maintain that peace of mind.

my next post will start with the fun thing on the 3M, money, method and mind.


weiwei.

[weiwei]

1st part of 3M - Money.

In this post, I would not discuss how much money you need to start trading, rather I will give you my view and opinion on it.

If you ask this question with the intention to learn, and not to make money, then you do not need a lot. Since you are here alreay at TL, you can look at all different articles, learn how other trades, pick up a method that suits you, and join the chat room here or else where to see how people trade.

But if you ask the question with intention to make money, then I said you need a lot, and you will have a very tough time ahead of you. Any you would not make much money with trading.

Why? Because you focus your attentions and energy on the wrong area that would not produce for you.

Money is the end result or product of one's efforts. You would have to put your efforts on the cause that will trun into the result or product. In this case money.

Now do you see why if you are new and have the intention to make money in trading will be fruitless. All because your energy will be spend on the area not would not produce.

So what wil produce. processes..

Image if you are a farmer, to get your crops, what do you have to do? you will have to do all the things necessary for it to grow, and if you miss one step, then you might not have that crops. Missing 2 steps, that crops might never make it.

It is when you master all the steps, knowing what to do at each stage, you will then have the chance to turn that crops into food. (I said chance because there might be external factors that whip out the crops, like storms and others).

So how much money do you need to trade, in my opinion is all relative. If you take the farmer's approach you will reach a stage that you know exactly how much you need to produce.

[keymoo]

weiwei thanks for sharing your experiences with us. I know that sometimes it can't be easy to even admit to ourselves what is going on emotionally, but to share it with us all is very gracious. Thanks.

[torero]

Good thread, weiwei, thoroughly enjoyed! Good on ya!

[weiwei]

I would like to add more to the Money part:

I think the valid question for a new trader is to know how much money dose he/she needs until he turn profitable?

even if one turn profitable, can that sustain his/her live style.

Because prople usually progress up. Usually, a new trader will pay tuition to learn, and after that, he slowly become consistant. You see, even being consistant might not generate enough for your life style.

But being able to achieve that consistancy level is a big achievement in any trader's view. can you see now, that even you win you still end up lose.

Of course one can figure out a way to deal with it, every good business man dose. But be prepare for it.

weiwei

[weiwei]

this will be the 2nd part of 3M. Methods.

Depends on your style of trading, one will need to chose his tool accordingly. ( Since i daytrade, so my focus will be more on day trading)

swing trade, position trade:
1. TA is OK, but need more money to hold position, and mental toughness to withstand market's gyration and account drawdowns.

2. Dose not need to make constant decision, but do need to have the discipline to take signals.

Day trading: so far those price derived indicators have not been working for me on day trading. I will list what has work for me, and one can judge for himself. And I only trade YM.

Preparation
1. forward thinking from higher time frame, mainly daily and 135M chart.
2. stats on different conditions, gaps, range.

During trading hour:
1. various SR line on 5M chart
2. Volume delta on the same 5M chart
3. $tick, time & sales,
4. 5M Point and figure chart on YM
5. 5M ES, NQ, and ER2 charts.

what I am looking at is the relationships on all these charts. These are what I call NOW indicators. Indicators that do not lag or lag very little. They give you the info for what is happening now, then I base on my setup from here.

Again this is approach that focuses on "the cause" that produce the result(price).

Even with daytrading, there are many styles and many approaches. One would have to use a method that fits the market that he/she trades and fits his//her personality.

there are so many systems and trading rules out there, I would suggest a beginner stick to one setup and very few rules. Once you master it, then move on to the next one. Important thing is to know exactly what to do with the system in all different market condition. so one can act accordingly.

weiwei