For those of you that are consistently profitable day trading, please tell me your inner-most, darkest, money-making secrets. I will reward you with….. gratitude. Or if what you give me is gold, you get 5% of my profits. HAH!
Day trading is tough. Shit, man.
I have been profitably swing trading now since about April. I was once told, if you are putting in 6-8 hours a day reviewing your charts, making spreadsheets on your trades, tracking what works and what doesn’t, making sure you don’t make the same mistakes and being mindful of every thing you do, you will start to become profitable in 8-18 months. It was about 8 months in April so that bit of advice for a successful trader gave me that extra confidence boost that “I’m almost there!”
And I’m glad I started off with swing trading. I think most who start off and go straight to day trading either call it quits very quickly or lose their shirts and fall into that 90% fail category. And I can see why.
Swing trading is slow. You plan out your trades the night before, sometimes several days before. You can work out your risk and reward. You can find out where you want to take partial profits, move stops to break even, all while having a cup of coffee and catching up on your latest facebook feed. So, sporadic, idiotic, spontaneous trades aren’t really an issue if you put your orders out and just let them trigger.
And you might over trade, but even if you do and you risk 1% of your capital, you’re really only going to lose on 5-7 trades a week if you’re really terrible. Even when I didn’t know what I was doing, I’d have an occasional winner. So you could kind of survive for months and months and just make a small dent in your account. Maybe go 6-8 months losing small, losing small, before you finally start winning (like me).
Flip it over to day trading. It’s swing trading on Walter White’s best stuff. It’s fast. It makes you pull your hair out. When you’re done the morning, you’re left thinking, wow, why the fuck did I take half of those trades all while looking at that awful red P/L. It doesn’t follow rules. It’s swing trading’s ADHD brother who also has OCD.
Profit target, partials, stop loss and entry. You pretty much have to calculate it all within seconds. And sometimes you enter with a position size too small or too large, and then realize, fuck me, why is it when I enter with small size, the trades goes for me and when I enter too big, it goes against me. That’s day trading.
I have my watchlist. I usually go with momentum stocks I scan on finviz based on previous days top gainers/losers and I also trade stocks that gap up or down more than 3% and have pre-market volume over 20,000. I have my strategies that I use. But shit man, sometimes I don’t get a trigger and it’s like I’m a crackhead looking for some crack.
This is my typical morning day trading:
9:30AM – Have 2 charts on my platform up. Both gapping down >3%. What I look for is price to oscillate or go up slightly and go back down through the open and that’s where I enter. Neither stock does so. Sheeeiiiiiit.
9:47AM – Hmmm, no triggers so far. OK, switch over to my momentum list. Here I look for a stock that has shot up or down and is now pulling back. I want to enter on the first pullback if I get a 3-minute consolidation or it gives me a nice reversal bar near VWAP. Hmmmm…. again, no pullbacks, these fuckers just keep hammering up or down with no rest in sight. The rest are just shitting around like a drunk man stumbling.
10:08AM – I once read a technical analysis book that talked about triangle patterns. *I squint at my stocks in my momentum list that haven’t really had any directional bias* That looks like a triangle!!!!! Shit, lemme get in on that! Enter. 5 minutes later, I’m down $100. Why the fuck did you take that trade, dummy.
11:06AM – Alright you’re down a Benjamin. Let’s get that back, no more dumb trades. Oh, look at this bad boy pulling back (from my momentum list). Oooooh, nice it’s coming down, you know what…. I’m just going to enter now and get a better price rather than wait for my actual trigger. That way my risk is reduced and I will get more when it hits my target.
11:20AM – Da fuck dude. You entered in on a falling stock, expecting the pullback and it just kept going down. You idiot. You’re down $200 now. At least you stuck to your stop loss *pat on back*
11:35AM – *switch to 5-min charts* OK, let’s go through my ToS scanner, see what stocks are hot. OH MAN, perfect pullback setup. Doji on the pullback, right at around 50% retracement. Good lord, lemme get in. Entered. Oh boy oh boy oh boy. My target is only .10 away but I see so much green in my P/L. You know what, the stock has already gone far enough, it might not even reach my target, so I should probably just take a partial profit now. Nah, you know what, just take the whole position off.
Boom. +$65.42. Yeah, I’m sooooo the man.
Oh wait, I lost $100 on 2 trades and decided to take profits at $65.42 on my only winner. And look at that bitch now. It more than doubled my target. Shit. I hate you stock. Why did you stutter before my first target, fake me out, then take off after you hit it. You’re such a bitch!
Yessir, that is my usual day trading day. I make money swing trading and lose it all day trading. Actually, I’m probably profitable 2 days out of 5 day trading. But those winnings days are still smaller than the losing days or about the same. So the day trading is bleeding me out.
It’s only been about 2 months since I started day trading daily. I dabbled here and there for about 2 months. And yes, all of my poor swing trading profits get funneled into my day trading losses. I think of it more as a business investment so that one day I can day trade for my main income and swing trade for the cherry on top. So of course, I should give it the same 8-18 month time frame before I can be profitable. I do track all my trades, the time I took them, why, etc. So I am being mindful after the fact even if I did take some bullshit-spontaneous-I’ve-got-ADHD-and-can’t-just-wait trades.
Hmmmm. Maybe I’ll start up a sweet $199 course and start a Youtube channel with me yachting in the south of France and telling you how easy and sweet life really is. If I ever do that, please refer my customers back to this post and let them know, you will lose money, you will slam your desk (many times), shout many obscenities, hate the stock market, complain to your wife that this shit isn’t easy and, of course, come back to do it all over again the next day. Day after day. For months or years. Yay.
Have a great weekend everyone. Taking Friday off, although I do have some orders sitting out there for swings. Taking the ol’ lady out for some din din and drinks. And then get drunk and complain how hard it is day trading. Don’t worry, she loves it! Cheers.