How can someone blow up in day trading?

[TraderZones]

Quote from traderzhangSan:

If you follow very simple rules, there is no way you can blow up.

Let's say once you enter the trade, you put stop loss and exit.

let's say you have some TA chart, which doesn't work at all. it means that you have 50% chance of winning in every trade.

All you lose is commission. if you put 5 trades each day trading one contract ES, your cost is like 50$ max. it takes one year to wipe out 10k account.



did I miss something here?

Your cost is $50 max? Have you ever heard of RISK? Have you ever heard of the bid/ask spread? Slippage? Unless you have a seat or something to that effect, you do not buy wholesale. Fees in addition to commission?

Add what is the point of daytrading to break even? If you do not risk anything as a stop, you will only lose, guaranteed.

 

[Lang]

Quote from traderzhangSan:

If you follow very simple rules, there is no way you can blow up.

Let's say once you enter the trade, you put stop loss and exit.

let's say you have some TA chart, which doesn't work at all. it means that you have 50% chance of winning in every trade.

All you lose is commission. if you put 5 trades each day trading one contract ES, your cost is like 50$ max. it takes one year to wipe out 10k account.



did I miss something here?

Let's see, you missed you classes in TA. TA helps to identify the best entry points for your money.

If you hit an active, high volume day then by the time you have entered your stops you are well past 2-3 ticks. And if you witness a drop of 4 ticks immediately followed by a rise of 15 then will you begin considering widening your range?

If you start chasing the market then you will always be one step behind the direction, which will put you into a losing category the vast majority of the time.

Your attitude changes when real money is on the table. Try playing online poker, both the practice and on the hook with your credit card, and try to analyze your bets. See if your gamble is correct to the risk/reward the deeper in the hole you get.

 

[spd]

Quote from traderzhangSan:

Can you elaborate more on what you said?

I am talking about day trading and every trade is intended to make 2-3 ticks. stop is also 2-3 ticks.

LMAO!

 

[PocketChange]

With a $10K account trading the system as the op described:

1 ES Contract Stop and take profits set at 3 ticks: 5 trades per day $5 RT trading cost. Each win nets $32.50 each stop loses -$42.50

5 wins = Net $162.50
4 wins 1 stop = Net $88.50
3 wins 2 stops = Net $12.50
2 wins 3 stops = Net Loss -$67.50
1 Win 4 Stops = - $138.50
5 Stops = Net Loss -$212.50

Statistically you will lose -$55 per day
About two weeks in you'll be down 10% and begin waffling.
4 weeks in down 20% you start bending your rules

Better off putting $10k in a 1% paying savings account.

 

[athlonmank8]

Commission (can be huge), slippage, spreads.....debate the fourth one which would be trend.

Death by 1,000 cuts. You'll blow out that way too.

 

[FanOfFridays]

Quote from traderzhangSan:
did I miss something here?

Yes. You missed something very important.

 

[traderzhangSan]

I am in total agreement with you on that!

The point I am making is to follow the simple rules like robot in order not to blow up is possible. How to make money is other issue.

Quote from athlonmank8:

Commission (can be huge), slippage, spreads.....debate the fourth one which would be trend.

Death by 1,000 cuts. You'll blow out that way too.

 

[illiquid]

You will never learn enough following rules like a robot. That's the catch-22.

 

[Now is Now]

Quote from traderzhangSan:

If you follow very simple rules, there is no way you can blow up.

Let's say once you enter the trade, you put stop loss and exit.

let's say you have some TA chart, which doesn't work at all. it means that you have 50% chance of winning in every trade.

All you lose is commission. if you put 5 trades each day trading one contract ES, your cost is like 50$ max. it takes one year to wipe out 10k account.



did I miss something here?

Common sense and minimal experience...


NiN

 

[elduerino]

The house always wins, and people like you are the reason for it, you do not understand that there are times to increase sizing, let winners run, cut lose early etc. 50/50 win/lose with a 1:1 payout, plus commision=death.... slow and painful death, a 1000 cuts as said before.