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Day trading- 3 months later, my experience


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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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