Is this seriously what trend traders do?

[Grantx]

You don't require deep pockets to swing trade - you require positions with capitalization that matches your comfort level and ability to hold a drawdown. I suppose you could swing trade 50 shares of stock. From little acorns grow big oak trees !

Interesting. Does the share market work the same as futures market? I can buy and sell on the same day if I wish? And lets say I want to buy a share of company X at $20 then how does that work with regards to margin requirements if I intend to hold for the long term (months)? If I put up $20 for one share does a portion of my account get locked into that as collateral?
Coming from futures I have no idea how the share market works.

 

[lovethetrade]

Interesting. Does the share market work the same as futures market? I can buy and sell on the same day if I wish? And lets say I want to buy a share of company X at $20 then how does that work with regards to margin requirements if I intend to hold for the long term (months)? If I put up $20 for one share does a portion of my account get locked into that as collateral?
Coming from futures I have no idea how the share market works.

From memory it's a legal requirement to have $25K minimum to day trade equities.

 

[bone]

And I thought the idea was to NOT day trade but to swing trade...

 

[speedo]

From memory it's a legal requirement to have $25K minimum to day trade equities.

Yes with 4x1 intraday and 2x1 overnight leverage max

 

[rajesheck]

They buy a position, it goes against them, stop out for a tiny loss.

They buy another position, it goes against them, stop out for a tiny loss.

They buy another position, it goes against them, stop out for a tiny loss.

They buy another position, it goes in their favor for a bit, returns to breakeven, stop out for scratch.

They buy another position, it goes beneficially, stop out for a win.

Why not just enter randomly?

Random entries strategy will definitely give loss because the probability for hitting the stoploss is huge in trading because price always moves in wave life fashion, not in straight lines.

The difference is a sound trader "times" his trade most of the time while a novice mistimes frequently.

Suppose a trader has the skill to judge the direction of the price every time. But if he mistimes his trade then it will hit the stoploss before hitting the target.

Hence trader must have two skills. One to judge the direction. Two to time the trade. And the strategy must reflect these two skills.

 

[777]

Humpty-Dumpty syndrome (of calling things whatever you like) is certainly flourishing at ET: call me old-fashioned ... call me pedantic/pompous, if you want (I've been called worse

) ... but I always think of scalping in the traditional, institutional sense of the word. Over the last year or so, I've gradually formed the impression that most ET members who describe themselves as "scalpers" probably aren't really what I'd call scalpers at all, and that the way(s) many of them are trading is actually further away from scalping than what I do myself (and I'm certainly not a scalper).

True of many posters.

However, when it comes to definitions, especially in technical areas, I try not to roll my own.

 

[maxinger]

They buy a position, it goes against them, stop out for a tiny loss.

They buy another position, it goes against them, stop out for a tiny loss.

They buy another position, it goes against them, stop out for a tiny loss.

They buy another position, it goes in their favor for a bit, returns to breakeven, stop out for scratch.

They buy another position, it goes beneficially, stop out for a win.

Why not just enter randomly?

Obviously NO!!! We don't trade this way.
Also your questions are too general. You need to be clear and specific.


Do not use the word 'tiny loss'. Many financial experts / writers like to
make generic statement.
It has to be quantified.

You have to be very clear what sort of trading you are doing.
Is it scalping? day trading? swing trading? position trading?


Let's talk about day trading ES .
If you set tiny loss of 1 tick, it is guaranted you will never ever earn money.
Loss should be around 10 ticks per lot and don't tighten it till we can't breathe.
If loss per lot is say 20 ticks, then that is suicidial.

For scalpers, stop loss will be smaller perhaps 1 or 2 ticks.

For swing and position trading, stop loss will be few tens/hundreds of ticks..

 

[sss12]

If a trader makes the strategic decision to analyze and model as many different instruments as practical then yes, you cannot realistically be a fundamentals-driven trader. Earlier in my career when I had no choice but to participate in a very specific energy or interest rate market then yes, I could truly focus on fundamental parameters (and technical analytics). In fact, I subscribed to very specialized boutique market analysis services. But with thousands of spread combinations and hundreds of instruments that is simply not a realistic practicality for me.

You don't require deep pockets to swing trade - you require positions with capitalization that matches your comfort level and ability to hold a drawdown. I suppose you could swing trade 50 shares of stock. Instead of trading Gold futures could you short a modest Gold ETF position ? From little acorns grow big oak trees !

At or in-the money options with a longer expiry will also work . With potential benefit of convextivity.

 

[murray t turtle]

I'm afraid that swing trading might be the last bastion of human traders; at the very least, it might keep us relevant versus the high speed bots. I think that's where the paradigm has been shifting to for the past couple decades.

%%
Agree; except I'm not afraid of it, but respect it. Of course a surprise rate raise or rate cut can cause fireworks LOL. Good chart on S &P , bone,what you call master trend i call it a main trend.
200 day moving average or 50 week moving average[some use a 40 week moving average]works well to define a main trend [master trend] .IBD [investors.com]teaches the same thing.

200 day moving average works well to define a bull market or bear market; sometimes what i call a chop slop trend [aka barbed wire range ,an elite called it LOL] can goof us up . BUT ITS NOT rocket science But SPY,QQQ..... pays dividends; gold or silver is a whole different market......

 

[truetype]

Steidelmeyer

Wow, hadn't heard Steidlmayer referenced in a while! Speaking of oldies but goodies, wonder what Covel is up to?