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Day trading- 3 months later, my experience


DavyJones

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Thank you very much for your post.

I have been trading since the end of June and I thought that I was just being an idiot. When I am day trading, I keep looking at the screen and then I panic as soon as the trade goes the wrong way and I lose money.

I am analysing the charts and drawing channels and trend lines but I am still making losses.

To be honest I don't know how people can make a living out of this trading. I keep losing what I make.

I will take your advice and keep a copy of the charts - daily/hourly and 15 min. I do usually use daily/hourly and 30 min charts. I can't get my head around the 1 minute charts; they just make me panic more and when I have used them, I have made the wrong decisions and traded.

 

 

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I have been following with great interest the various comments re your ‘baptism of fire’ over the last few months.
From my own personal experience and testing the advice of others, a comment made on another platform that sticks with me very forcefully is: “the only aspiration of the market is to persuade you to pay more for your shares than they are worth and then to buy them back from you at a much lower price”.

Whatever the ‘news management’ or any other marketing stratagems used, these are exclusively for the sole purpose of making money for the market at your/my expense. 
Call me a cynic, but nothing I have seen over the last 4 years convinces me otherwise.
True value has its place but it is hard to find and the ‘retail’ (that is us) usually arrives on the scene after the profit bus has already left.

 

 

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On 30/07/2020 at 11:58, DavyJones said:

I have come to the preliminary conclusion that only fast moving stocks or big news you can make money DTing. I did ok on EasyJet recently and FTSE is absolutely tanking today (i got in late) but for the majority  of stocks  is just not worth trying .

I think I will start looking more towards swing trading in the next month and easy off DT. The overnight risk is a concern but as you say you can always use  Share dealing but with UK stocks you have the charges. US I find much better 

 

 
 

I believe you are correct and also, active trading won't make big money in the short-term but it will beat the 2% or less that savings accounts will net you.  As to whether it beats buying an S&P 500 ETF and doing nothing, that remains to be seen :)

Edited by dmedin
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For day trading you need a broker who does not eat your profits in the name of conversion and commission. IG is the worst.

with falling USD there is no point in dealing with shares for IG. Example 

1) Bought SPOT 50 shares at $253

1) 2 hours later sold SPOT at $256.

Return -£25 (yes negative)

They say they don't charge commissions but their conversion rates are so different for buy and sell that you are just donating them your research, hardwork and profit.

Did the same experiment with DEGIRO ended up with £100+.

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21 hours ago, yosoh said:

For day trading you need a broker who does not eat your profits in the name of conversion and commission. IG is the worst.

with falling USD there is no point in dealing with shares for IG. Example 

1) Bought SPOT 50 shares at $253

1) 2 hours later sold SPOT at $256.

Return -£25 (yes negative)

They say they don't charge commissions but their conversion rates are so different for buy and sell that you are just donating them your research, hardwork and profit.

Did the same experiment with DEGIRO ended up with £100+.

 

Cheers, I made a post about the exact same thing , up $87, profit -£52 in 2 mins! Will check out Degiro. 

On 07/08/2020 at 05:44, FranticFred said:

I have been following with great interest the various comments re your ‘baptism of fire’ over the last few months.
From my own personal experience and testing the advice of others, a comment made on another platform that sticks with me very forcefully is: “the only aspiration of the market is to persuade you to pay more for your shares than they are worth and then to buy them back from you at a much lower price”.

Whatever the ‘news management’ or any other marketing stratagems used, these are exclusively for the sole purpose of making money for the market at your/my expense. 
Call me a cynic, but nothing I have seen over the last 4 years convinces me otherwise.
True value has its place but it is hard to find and the ‘retail’ (that is us) usually arrives on the scene after the profit bus has already left.

 

One personality trait I noticed, I turn on my IG account , check the markets, news and usually with 15minutes I make a trade. That makes no sense, Its like I am just looking for an excuse to trade  . A good trade didn't happen to coincide with the moment I randomly decide to open IG 

 

22 hours ago, dmedin said:

I believe you are correct and also, active trading won't make big money in the short-term but it will beat the 2% or less that savings accounts will net you.  As to whether it beats buying an S&P 500 ETF and doing nothing, that remains to be seen :)

 

I am still leaning towards there are profits to be made if you put in the hard work and further that you need to focus on particular assets. I trade silver more that anything and have about 70% hit rate now, however my one trade yesterday wiped out twice anything I made on silver since I started! Dumb mistake, I could have sworn I put on a stop with PRT but on the IG platform it did not registered , I should have checked! Was £250 up, went to supermarket came back £1400 down! Same with Gold, was 350 up, swing trade running last few days, stop moved up to swing low within 30 mins it dropped and stopped me out at £5 up,  I didn't sleep well last night, turning over in my mind what thinking about how reckless I was! That could be the half bottle of whisky I drank though to drown my sorrows. haha

 Again it's these these foolish mistakes are costing me badly. However I suppose the positive side is they that are fixable mistakes, 

 

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53 minutes ago, DavyJones said:

 

Cheers, I made a post about the exact same thing , up $87, profit -£52 in 2 mins! Will check out Degiro. 

 

One personality trait I noticed, I turn on my IG account , check the markets, news and usually with 15minutes I make a trade. That makes no sense, Its like I am just looking for an excuse to trade  . A good trade didn't happen to coincide with the moment I randomly decide to open IG 

 

 

I am still leaning towards there are profits to be made if you put in the hard work and further that you need to focus on particular assets. I trade silver more that anything and have about 70% hit rate now, however my one trade yesterday wiped out twice anything I made on silver since I started! Dumb mistake, I could have sworn I put on a stop with PRT but on the IG platform it did not registered , I should have checked! Was £250 up, went to supermarket came back £1400 down! Same with Gold, was 350 up, swing trade running last few days, stop moved up to swing low within 30 mins it dropped and stopped me out at £5 up,  I didn't sleep well last night, turning over in my mind what thinking about how reckless I was! That could be the half bottle of whisky I drank though to drown my sorrows. haha

 Again it's these these foolish mistakes are costing me badly. However I suppose the positive side is they that are fixable mistakes, 

 

Maybe options?

 

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On 08/08/2020 at 09:00, Kodiak said:

Maybe options?

 

John is one of the nicest people I have ever met - Best thing I ever did was buy him a coffee at the London Traders expo in 2011 (ish) and get him to sign a copy of his book, as the 10 min conversation that followed for the price of a coffee before he took to the floor was enlightening.  

 

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On 07/08/2020 at 10:02, dmedin said:

Swing trade shares FTW.

a platform should not dictate what strategy to use for gaining maximum profits. In the end it depends on the setup of the trade you are doing which one to go for.

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11 hours ago, yosoh said:

a platform should not dictate what strategy to use for gaining maximum profits. In the end it depends on the setup of the trade you are doing which one to go for.

It's not the platform that's 'dictating' how one ought to trade, it's the structure of the fees and commissions.

A common complaint against day trading in the academic community is that after fees and commissions, most 'day traders' fail to outperform an S&P 500 tracking ETF.

Edited by dmedin
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To my mind there are two basic strategies plus money management.

1. Focus on just one or two shares that have a logical relationship, indices or currency pairs. Not all at once, but just two from the same genre so that you have something to compare with.

2. Discover by observation (not by chucking money at them) what time frame works well with the Guppy Moving Average + Ichimoku (with only the two colour fills; Senkou span A & B in play). If using IG platform, then you can switch out the Tenkan, Kijun and Chikou San).
Some indices will lead you a wild goose chase except on very short timeframes 30s or 1minute or the longer time frames, 2 or 3 hrs but you need to observe, observe and observe.
SMA 50 and 200 SMA can be useful to get a sense of trend.

Think of it like planning a fishing trip. If you do not plan, usually you do not catch, unless you take a young grandchild with you who disobeys all the rules and out-catches you.
BUT he is gambling with your fishing gear so he has nothing to lose.

Sorry if I started to get wordy.

 

 

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  • 9 months later...
  • 2 weeks later...

Most daytraders just have gambling problems/addiction  .  If when you sit down at your platform and are in a trade within minutes chances are you fall into this category  .  You need setups that provide an edge , an empirically proven systematic edge with a positive expectancy  , Many times this 'edge ' may take a few hours to trigger  .  Patience is needed to wait for the' right ' moment and then decisiveness and the ability to unemotionally take a trade is paramount . I'd suggest that > 90% of 'daytraders ' would have no idea of their expectancy and if they actually knew their expectancy it would force then to acknowledge they have negative expectancy ( zero edge ) . Anyone what actually quantifies their expectancy and finds its negative would be a fool to continue trading  > daytrading successfully is one of the hardest jobs out there , easier to become a successful lawyer imo  .  Anyone that think they will become a profitable daytrader without putting the best part of a decade learning is fooling themselves  .  Daytrading has its benefits sleeping on cash overnight and weekends as time in market is risk  , you need to be in a position while its moving and get out when it stops  .  In an average day i can often only be in market for as little as 2 hours .  If you can get to the level that maybe the top 2-3% can get its a lucrative pursuit but it will be the hardest thing you have ever done . Thats what makes it worth doing . Good luck to all that go down this road but lucks got nothing to do with it in reality . The correaltion between ' luck ' and HARD work can never be underestimated   Maths and data will set you free  but not the usual datafit thats prevalent out there , You need to understand what to measure in price action that presents itself in repeatable patterns  . You need to understand bias regimes , volatility , momentum , etc and develop tangible unique ways to define . The usual generic studies in most platforms are not great at doing this  . There is no one stop algo to deal with all market stages ., you need a ' set ' of systems for different regimes and some filters to switch between them as markets shift regime . Volatility is what i find the key to much of this  .     If i have turned anyone of from daytrading you were not right for this pursuit .  

 

Rock on   . 

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I don’t think I’ve ever come across an accurate post like this. The post is fantastic, and I honestly agree with almost everything about how YouTubers scam people to gain views and make money. And also how bloggers and authors sell some not-so-good tutorials. Frankly speaking, I don’t trade anymore because I believe trading is not for me. Trading is so tempting that it makes me a bit greedy sometimes. I’m starting to get involved in another thing, maybe investing in some stocks I’ve seen in https://timthomas.co/12-best-5g-stocks-to-invest-in/. The only thing I hate about investments is how long it takes to benefit from them.

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  • 1 month later...

Hey good post.

It takes years and big losses to make it through - I know; that's why so many fail. The money runs out before they can establish a technique/edge to put the odds in they're favour.

Would you do brain surgery on someone without years of training and experience building? The same principle applies here.

Don't go there if you don't have the funds and committent. Nothing but nothing can get in the way of your trading; family. friends, jobs, holidays count for nothing whilst you are learning the ropes - it takes years - there are no short cuts.

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  • 2 weeks later...
On 18/08/2021 at 01:15, chloerampl said:

I haven't been trading stocks for very long, but I really like it...

Wow, your three-month experience is quite impressive, there are some people who in a few years can not do so much. Plus, I think your experience will be useful as a theoretical part for those who want to invest specifically in this area and not know how to do it. When I started trading, not knowing how this mechanism works, I started reading and receiving experience from Porter Stansberry. I think it was a fair step, because in the shortest time I could feel myself growing. It is quite important to receive some theoretical information from an experienced person, so run away from some failures that you may have

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On 17/07/2020 at 06:55, DavyJones said:

The point being, you start to learn about your  technique and they way you trade which no book can possibly know.

Your post is Spot on.  I couldn't have written it any better myself.  I started with IG back in March 2019 and boy did |i learn a lot about myself and my own Fear and Ignorance.  I nailed the Demo daily using only 2k.  I posted my wins on here a lot too but received a lot of criticism as it was The Demo and Not Real.  I argued It Was Real.  I traded as if it was real.  the stock picks were real.  But i was wrong, you can't comprehend the Real Emotion using Real Money and taking real Losses.

I had £1400 to start to Learn to Trade.  I made £400 in 6 months but ultimately lost 1800 too.  Then i took a 6 month break from it all.  I learned a lot, like you say, about myself!

I've been trading with IG and Saxon.  I use IG for Day Trading as the platform is quicker and easier to use, but:

This week with IG I made a 30% gain with Geovax.  It was up 70% but when it pulled back i got out.  I made 290£ on it.  But even though I've been trading for almost 3 years (18 months really) I didn't realise there were costs associated with Day Trading US shares in the UK.  I've been Swing Trading for 12 months.  I started Day Trading shares this week.  Imagine how dumb and embarrased I was when I noticed that I lost the 290 profit from last week as I was placing so many in and out trades.  There is a Currency Conversion cost and a 0.5% Spread in Share dealing!  I thought it was FREE :D



But here is my greatest learned experience.  Stay Away from Illiquid Stocks if you want to Day Trade.



I am around 80% correct on my Stock selection.  All of them have gone in a big way, but my timing is Way Off.  I've been holding some stocks for 6 months.  The frustration has ruined me, not to mention the Daily activity I've missed out on as my Capital was tied up.

These days i flick thru the Timeframes.  All of them.  When I see an opportunity to get in, first i need to decide how long I'm going to hold the position.  Am I going to Swing OR Intraday.   Knowing this is essential.  I use MACD, RSI, EMA and VWAP, Pivot Points, then place based upon S/R lines.

I'm usless at studying Fundamentals, know nothing abuot how the market moves really and choose my stocks based upon tomorrows news not todays.  Basically I Specualte, which I guess is what it's all about.  What will be Big Tomorrow.  But Swing Trading is making me get in far too early and i still have a bad habit of buying at the Top.

Though i may be correct in my stock picks almost 100% of the time where I Buy In is wrong.  So up and down I got for weeks waiting to even Break Even again.  I've done this so many times too where i get back out at my In price only for it to Break Out lol.

So as I continue learning my New Improved Strategy is this:

Whatever i think is going to happen, do the opposite.  We'll see wha thte rest of this week brings.  :D

 

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hello . I am  very new here. started 2 weeks a go trading CFDs. and stop trading uk stock after my first week . as it made no sense  due to very high in commission ... for example    I buy Aviva   .... 10,000    AND I was out £80  AND my position was FEW   %  BILLOW the market price  then price went up by (1.8 pence)  I made less than £70 ..

I  now found out if, I trade USA stock with my own cash ( share dealing)...  is 0  commission ?? even if I day trade with it ( NOT CONSIDERING EXCHANG RATE )  as its  very small 

 trade  CFDs... USA stock   $30 per trade /  10 TRADES A DAY  AVERAGE $100  PER POINT    .....OVER 50% go as commission considering some RED trades as well ......   

DO you have any advice on how to reduce the commission  ????   

thank you .

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