Day trading- 3 months later, my experience

[skybloke]

How about the following statement from the top of the home page (that seems to have been forgotten about).....

"Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 66% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money."

I've seen that 66% figure well above 80% at times elsewhere. Users are now therefore beating the system more than they used to OR the industry found a new consensus to define that risk lower to make it more attractive perhaps?. You decide.

The above tells you that the vast majority, and I mean VAST, WILL lose money. This thread simply is yet another one that proves the statement is quite correct.

Unless you consider yourself to be in the top 10%-20% (and let's face it we ALL do) then a sensible person would say steer well clear. Hmmm.Human nature says otherwise ....and that's why you're here.

This is really just another lesson in life, learning more about ourselves rather than becoming an "expert" in financial markets.

Good luck to you all.

[Jul78]

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

I thought i summarize my experience so far day trading in case any newer folks are interested 

Day trading is much harder than swing trading and especially at those lower time frames. 

From 100+ day trades so far I am certainly no expert and I like being honest, I am on average losing  but I learnt a lot. My thoughts so far are:

1. Forget 95% of youtube,  it's full of turds just trying to market courses, **** out their channel. Same with forums, no matter what topic it is (fitness, languages), a lot of people lie their asses off and pretend they are experts but in fact know jackshit about it. Even the supposedly guru's are full of sh@t. For example the guy who wrote that best seller "Trading for a living", Dr Elder. He came up with his own "impulse system" and brags about it. It just  MACD and Moving average, nothing more . Aslo on their own private forum (which I was on for $60 a month) the group consistently underperform the S&P and even their best Gold start traders barely out perform it. Everytime you asked a question you got told, "buy this extra course for $100's  Its the same with Anton Kreil, $15k for a course? I have no idea if he is good or not but its seems to me that it's the easiest thing in the world to prove your validity. Publish your trading accounts, get them audited by an auditor, show tax statements, do live streaming etc If I was building a business as a trainer that's what I would do. 

2. Having said that there is a lot of useful information that if you look at it objectively it can be great advice. Keep a word document and write down your own points. Ignore every cherry picked chart they show you (apart from the educational content), use your own, scroll back a 500/1000 bars and then start looking at the extreme right hand bar, moving forwards bar by bar and ask yourself "ok what will I do here", you will soon  find out that even if you got the direction right, spreads, commissions, trend reversed too quickly,  stops etc killed it . It will paint a very different picture than what youtube baseball-wearing-cap-on-backwards hipster is telling you.  

3. Day trading is a job, not a hobby and a difficult one, you need to put in the hours, research, do your homework, keep a trade journal take notes and analyze what you have done etc

4. You are essentially trying to make cash like flipping a coin over the long run with one side weighted in your favour. 

5. Forget working on hunches or "I think  the stock price will go up / down" You are doomed to failure. A proper system is the only way  

6. Risk Management is the most important concept by far in my view. The generally advice is never risk more that 1 - 2% on a trade. I personally think that is too much . I would keep it at 0.5% max until you work what you are doing. 8 losing trades in a row at 1-2% and it starts to hurt and self doubt really creeps in. 

7. Demo always seems like a good idea but in reality it never worked for me. I put on trades forget about them, have no psychological connection to wins / losses. You need to use real money, even if it's just the bare minimum to see those  losing ££ . I have put on 4 trades over last few days.All 4 were up 2 x Risk but because I am a total **** I didn't cash out and all hit stops resulting in 4 losses. It was only £80 between all 4 but the fact I got greedy (yet again!) annoys me 

8. If your profitable with a year you're lucky.  My aim is to just break even by christmas to see if I can sustain a modest living in this. I have income from other sources anyway. 

9. The reality is that its a heck of a difficult job to make money day trading., Brokers  like IG, and all the others make money by continual flow of clients coming in losing cash and eventually leave, hence the large marketing. I don't blame them, it's a business model, not a hippy self help group, but just be realistic.

10. Most news, ideas is **** and pointless. I worked in investment banking on the trading floor for 15+ years. Every Monday we had to come up with a trade idea for clients , Derivatives / inflation, bonds, 90% of them were sh@t, I know I wrote them, we just had to do something. It's the same with market news, broker webinars etc, trading channels / ideas etc, the staff are tasked to do something. More noise, more videos, more website hits,  more trades = more commissions / sales.

11. Don't jump around from stock to stock, to FX, to crypto. I believe if you are not making money in two or three the problem is you, not the asset.  They all have their own personalities, e.g. Coca cola  barely moves, Tech stocks jittery as hell,  respond to news, others hardly at all, so you need to spend sufficient time on see what influences what. 

12. as above, don’t jump around  with different trading strategies, 200 different indicators etc. You need to limit all the moving parts and focus  

13. Best way I found to improve, (so far) , For every trade, I immediately write down why  I entered the trade (note 5) , for example

Long MA Strategy 
(a) Rising 200MA
(b) Rising 20MA ,
(c) 20MA crosses over 200MA
(d) price near 20MA

seems like a winner on paper but I still kept getting stopped out. Then afterwards write down what happened, e.g. after the trade exit I put  screen shots of 3 time frames (daily hourly / 15min) into a PowerPoint and detailed where I went wrong. Several things became clear such as
- 2min charts was pointless, you would never make the spread back
- The risk / reward (1:2) was to high, a 1:1.2 would have paid off > 50% of the time .
- I was fannying around with stops, for no reason. etc
- I'm putting on trades because I'm retarded, e.g. long trade,  on a bearish trend in larger time frame

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

Heck it's boring but I am starting to see patterns about the way I trade (= c@ck up). The best traders I saw in banks were the OCD ones. The wannabe Burberry wearing chavs all got pushed out or sent to Starbucks to pick up the coffee

 

The million dollar question:

can you make money? At this stage, I am still undecided.  I think there is light at the end of the tunnel but its going to require work, a plan and mental commitment for sure.

Anyway, long post but hope it's useful for some folks

(apologies for the obscenities!) 

 

 

Hello,

Summarizing your experience is a great way to share insights with newer day traders. Indeed, day trading can be more challenging compared to swing trading, particularly at lower time frames. Day traders face increased pressure due to the need for quick decision-making and constant monitoring of the markets. The rapid price movements and increased noise at shorter intervals can make it harder to identify reliable trends and potential entry/exit points. Swing trading, on the other hand, allows for more time to analyze and strategize. Aspiring day traders should be prepared for the intense learning curve and psychological demands, while also ensuring they have a solid understanding of risk management and discipline.

 

[Jul78]

Day trading has been a challenging experience for me, and I've learned some important lessons along the way. Comparing it to swing trading, I found day trading to be even more demanding, particularly when dealing with lower time frames. Despite having engaged in over 100 day trades, I must admit that I am not an expert, and on average, I've faced losses. However, I believe in being honest about my journey, and I consider these losses as valuable learning opportunities.

Day trading demands quick decision-making, discipline, and a deep understanding of market dynamics. Managing emotions is crucial, as impulsive actions can disrupt a well-defined trading strategy. I have realized the significance of risk management and preserving capital, as it's essential for long-term success. Each trade has imparted valuable insights, irrespective of the outcome.

Preparation and research are key components of day trading. I've learned to analyze charts, identify patterns, and pay attention to technical indicators and market trends. Staying informed about relevant news and events has become a part of my routine. Maintaining a trading journal has proven useful, allowing me to reflect on my decisions and improve my strategies.

Day trading requires adaptability, as the market is always changing. What works in one situation might not be effective in another, and flexibility is necessary for survival. While the thrill of quick decisions and trades keeps me engaged, I've also learned to manage my expectations, understanding that consistent profitability takes time.

For newcomers interested in day trading, I offer some advice. First and foremost, focus on building a strong foundation in trading principles and strategies. Seek mentorship or guidance from experienced traders to gain insights and learn from their experiences. Understand that day trading is not a shortcut to wealth; it demands dedication, patience, and a willingness to learn from mistakes.

Starting with a smaller trading account and setting loss limits can help manage risk. Concentrate on a select few trading strategies that align with your risk tolerance and market preferences. Implement proper risk management techniques to safeguard against significant drawdowns.

In conclusion, day trading is undeniably tough, and my experiences have reinforced this truth. However, the knowledge and insights I've gained will contribute to my growth as a trader. Day trading requires discipline, market awareness, and emotional control. It's an ongoing learning journey that demands constant adaptation to market fluctuations. To those considering day trading, I advise approaching it with dedication, patience, and a commitment to continuous improvement. Success in day trading may not come easily, but with perseverance and the right mindset, it can be achieved.

[JohnnyRy]

One of the few books that are not, well, filled with pages of toilet paper, is a programming book. I guess it's tough to lie about math and formulas without immediately exposing one's self. I credit having learned to code for 51% of my profits.

I have seen, and developed, several strategies that were fine in all respects. My issue was... me. For one thing, I found that I simply couldn't continuously monitor the 24/5 market that is forex. No one can. Oh but I tried. In retrospect, it was the closest thing to utter insanity.

As time progressed, I eventually turned my OCD into OCCD (obsessive compulsive coding disorder) by learning to code trading algorithms. The remaining 49% of my profits, I credit to my technical and statistical analysis of historic GBPJPY chart data which ultimately resulted in my strategy.

Also, the retail trading industry is filled with businesses that simply make money as long as we place trades. This is why most trading platforms include constantly updating news feeds, flashing lights, changing colors, and an endless supply of spaghetti indicators. A bot doesn't see all that stuff unless a coder forces it to do so.

Note that most platforms don't support autotrading today. Years ago, an ATProCI platform included a custom bot builder module that automatically wrote trading algorithms in C#. It was like surfing a simple web page with buttons, form fields, and drop-down menus. If you search for it online today, it's as if it never existed. I wonder why.

 

[capitulinagarage]

Those early losses can feel like being thrown to the wolves on Wall Street, but sticking with it for a year just to break even sounds like a long, uphill climb.

[capitulinagarage]

On 09/04/2024 at 12:54, capitulinagarage said:

Those early losses can feel like being thrown to the wolves on Wall Street, but sticking with it for a year just to break even sounds like a long, uphill climb.

Maybe there's a way to navigate this jungle a little smarter?  While practice is key, some solid resources can be your compass.  I found this website https://blackeaglefg.com/ that offers educational content  –  think webinars and ebooks – for traders of all levels.

The key isn't getting rich quick, it's about learning the ropes and developing a strategy with staying power.  Even seasoned explorers get lost sometimes, but a good map can make a world of difference.

[TheGuru12]

On 03/08/2023 at 14:49, Jul78 said:

Day trading has been a challenging experience for me, and I've learned some important lessons along the way. Comparing it to swing trading, I found day trading to be even more demanding, particularly when dealing with lower time frames. Despite having engaged in over 100 day trades, I must admit that I am not an expert, and on average, I've faced losses. However, I believe in being honest about my journey, and I consider these losses as valuable learning opportunities.

Day trading demands quick decision-making, discipline, and a deep understanding of market dynamics. Managing emotions is crucial, as impulsive actions can disrupt a well-defined trading strategy. I have realized the significance of risk management and preserving capital, as it's essential for long-term success. Each trade has imparted valuable insights, irrespective of the outcome.

Preparation and research are key components of day trading. I've learned to analyze charts, identify patterns, and pay attention to technical indicators and market trends. Staying informed about relevant news and events has become a part of my routine. Maintaining a trading journal has proven useful, allowing me to reflect on my decisions and improve my strategies.

Day trading requires adaptability, as the market is always changing. What works in one situation might not be effective in another, and flexibility is necessary for survival. While the thrill of quick decisions and trades keeps me engaged, I've also learned to manage my expectations, understanding that consistent profitability takes time.

For newcomers interested in day trading, I offer some advice. First and foremost, focus on building a strong foundation in trading principles and strategies. Seek mentorship or guidance from experienced traders to gain insights and learn from their experiences. Understand that day trading is not a shortcut to wealth; it demands dedication, patience, and a willingness to learn from mistakes.

Starting with a smaller trading account and setting loss limits can help manage risk. Concentrate on a select few trading strategies that align with your risk tolerance and market preferences. Implement proper risk management techniques to safeguard against significant drawdowns.

In conclusion, day trading is undeniably tough, and my experiences have reinforced this truth. However, the knowledge and insights I've gained will contribute to my growth as a trader. Day trading requires discipline, market awareness, and emotional control. It's an ongoing learning journey that demands constant adaptation to market fluctuations. To those considering day trading, I advise approaching it with dedication, patience, and a commitment to continuous improvement. Success in day trading may not come easily, but with perseverance and the right mindset, it can be achieved.

The IG Index API certainly helps with alot of that.