People like that steve tvardek. Where did you learn DAYtrading??

Quote from Maverick74:

I understand there are a many ways to sheer sheep, I'm asking you if you are happy. I always felt scalping for pennies is akin to prostitution. A trader whore if you will. LOL. I mean if you are honestly happy trading this way and you make money, hats off to you. There is no wrong way to trade if you are profitable. I am just questioning the sanity of it.
More...

im not in any of your leagues, but i understand your point. my buddy sits all day trading one ETF and might make 1 or 2 trades a day - he has high % winners, but many are $.05 -$.08/share gainers - he retired early and doesnt need the money for living expenses (probably irrelevant). now i realize that he has an edge & we jointly devloped the "approach", but i'd rather practice my profession than sit there all day for a couple of nickels. im not insulting anyone's approach or scalping methods; im just not wired like that. he has been profitable for years now.

thanks to the stud traders for taking time to post.
 
The thing about trading is that there are so many ways to succeed or fail. And one persons way to succeed is anothers way to fail. Ones boredom is anothers interest.

I have a 69pt target (yep) but I know another trader who would trade the same contract with a 10-12 point target. And both of us make money so thats good. We actually need people at all timescales and rangescales (imo) to provide liquidity. Its up to each learning trader to find their own niche.

By way of offering another way to succeed one could find a timeframe (like 3m or 5m or 30m or 240m) and plonk a couple of mas on the chart. Then go thru the recommended process here (6 months to 24 months of study and experimentation). And at the end you would understand which mas represented support and resistance on that timeframe and how to use the mas as an aid to profitable trading.

Thats what worked for me.

Of all the tests though the one I found hardest was to stick to my method once I'd developed it. In my own case I think that part of the problem was that I discovered so many ways to enter and exit along the way and having the discipline to only use a couple was a tough call (for me).

Best of luck with the process. :)



PS. By way of books I think it pays to understand risk of ruin and how much money to use and that a book can help you skip over the most painful learning in this area (Tharp's first book). And you can find lots of ideas that could lead to success in a book like Hill's "The Ultimate Trading Guide." But you have to take the tools that appeal and ultimately make them profitable for you
 
Quote from Maverick74:

You forgot item 3. "Beware of Greeks bearing gifts."
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How's it goin' Mav.... i really appreciate the time and effort you
put into the tape reading thread. Done by an expert and clearly written as well.

Hmmmm ....item 3 is good advice. In German gift means poison!!

have a good one, Mav.

... rj
 
Amen to that! Speaking of which, I have the utmost respect to those guys posting on the Trader P/L thread. Don't see them flamming or having any attitudes. I consider them the real deal even if some are inconsistent. Contrast that with those who have 1000+ posts and all you get from them is either the usual 'blah' or insults.


Cariocas

Quote from rcj:

I really hope zillions of people see this, especially item 2.

Thanks, xxxskier.
More...
 
I stumbled upon this article a few days ago and I think it's great for this thread and is toately true.

The 3 Phases of Trading Business Maturity
By Jim Harrison of Emini-Master.com

As new traders, or those who have gained a new vigor in the pursuit of success, we must understand that the road ahead of us will not be easy, nor will it be a quick journey. The path that lies ahead is filled with daily challenges that will test our skills, both technical and mental. In fact, most traders fail to progress past the start-up phase. They fail to learn:

* To take a loss
* To be wrong
* That, to succeed, they must take the time required to learn!

The one constant fact that all successful traders, including Borselinno, Fisher, Jones and more, all agree on is this: It takes time to become a successful trader. Borselinno says at least a year; Fisher says maybe 2 years, but they all say this business has nothing to do with instant success. Quite the contrary: Most successful traders say that Survival is the first key to success. Expressions such as, “Love to take a loss” or “Keep the losers small” all provide big clues that, indeed, we must survive to prosper.

As a business consultant, I have often contracted to work with business owners, corporate executives and decision makers to offer fresh ideas on business operations. Throughout the years, I have documented specific cyclical patterns of businesses as they evolve. The remainder of this article cites some characteristics of the 3 identifiable phases that I have witnessed and how I relate them to trading as a business.

Typical Progressions of the Start-Up Phase of a Trading Business

We:

* Are lured by money
* Perceive a low barrier to entry
* Are influenced by “Peer Pressure” news hype
* See that a friend did this and that
* Read a few books
* Go to a few seminars and get all that is freely available online
* Find some speculative capital
* Trade
* Win
* Lose
* Lose
* Find we need the right tools but think we can’t afford them
* Think, “I need to try something more difficult.” even though we don’t understand what we just tried nor do we have the tools or the education
* Lose more
* Understand that we truly do need to work on “planning” and a way to shift our emotions from an adversary with respect to our goals to a powerful force that guides our actions
* Finally, understand that it is okay to take a loss (In fact, we discover that this was the first lesson we needed to learn to survive!)

Survival is actually the goal for the start-up phase. So, then, we graduate to the Growth Phase.

Typical Progressions of the Growth Phase of a Trading Business

We:

* Make a commitment to getting education and the proper equipment
* Actually learn something
* Plan
* Trade with better results
* Decide to make it complicated for some stupid, unknown alien reason
* Lose patience
* Lose
* Simplify again, refining
* Now understand the importance of patience in all of this
* Take more risk
* Are slaughtered by the market(s) even worse than ever before
* Now have trouble pulling the trigger when the set-ups are very clear
* Begin to understand the importance of discipline
* Discover the mechanics of trading
* Learn the life cycle of a trade
* Commit our capital as planned, using strict money management
* Get better
* Start actually accepting responsibility for our own actions
* Stop searching and start focusing (That is the key to graduating to the Maturity Level.)

Typical Progressions of the Maturity Phase of a Trading Business

We:

* Are patient in our endeavors
* Are disciplined enough to trade our plan
* Understand leverage
* Practice strict money management
* Take less and less risk, preferring to use size on stronger signals
* Learn how to handle huge dollar profits but keep our perspective (return on investment versus time to money)
* Find out how to handle huge dollar losses but keep our perspective (return on investment versus time to money)
* Truly understand the life cycle of a trade and can plan accordingly
* Commit to a lifetime of education and learning
* Now trade on auto-pilot, choosing to participate when the best risk:reward ratios exist
* Make our main priority to trade our plan

The bottom line is that many people have traveled this path, but very few have succeeded. I think it prudent as we travel the path to be aware of the natural tendencies regarding the progression of ALL businesses and how we can prepare for bettering our odds through the use of the proper tools and education, as well as serious planning for each phase.

TAKEN FROM: Jim Harrison @ eMini-Master®.com.
----------------------------------------------

I think it will be interesting to hear everyones trading styles, some of which have been posted already.

I consider myself a scalper, not for pennies, but for dimes, sometimes a position may be held for dollars, depending on what type of market it is(range or trending). I gave up on almost every indicator for day trading, but I still like MA's, paintbars for crossovers to keep me in the direction of the trend, volume, candlestick chart patterns, T&S, S/R and trendlines(which are drawn in). I don't use any indicator for entry or exits, its all based off of price action of the stocks I'm looking at and also the bid/ask prices, which are somtimes used to determine breakouts when a trade is printed outside a key level on the T&S. I think all of these are essential. I've used different trading styles, but the most important thing I've learned is specialization of what you are trading by putting in the time to learn it, just like what everyone else on here says.

I atcaully don't use LEVEL II, becuase I already have too many charts to look at for what I'm doing. I'm, sure there are guys who specialize on LII and couldn't trade without it and can pick the axe out easily, but I've found a trading style that doesn't require it, and I believe in the past when I did use LII that I put too much time into analysis of the depth instead of the tape, which is the most important thing for high volume stocks. I use to think that ETF arbitrage wasn't a profitable strategy for individual traders, but I've learned that a variation of this strategy similiar to pair trading works. I have an extensive journal, blog, and sometimes I make videos with camtasia, which is great to look back on to improve my trading. I'm always looking to better my trading, and testing out new ideas, which I think is essential to survival in trading.
 
I'm glad a started this thread and that such fine traders wanted to answer. I think it's time to focus on that t&s. To me that's what the forces of the market are all about.

I agreed on the statement that trading equals working and that many new traders keep thinking about the money instead of working for it. On the other hand, I know a couple of traders who became utterly passive the last then years claiming that daytrading is too labor intensive and are after +15 years of trading getting back to simply holding CANSLIM type of stock. (Probably because they can afford to wait for it)
 
Quote from john99:

I stumbled upon this article a few days ago and I think it's great for this thread and is toately true.

The 3 Phases of Trading Business Maturity
By Jim Harrison of Emini-Master.com

As new traders, or those who have gained a new vigor in the pursuit of success, we must understand that the road ahead of us will not be easy, nor will it be a quick journey. The path that lies ahead is filled with daily challenges that will test our skills, both technical and mental. In fact, most traders fail to progress past the start-up phase. They fail to learn:

* To take a loss
* To be wrong
* That, to succeed, they must take the time required to learn!

The one constant fact that all successful traders, including Borselinno, Fisher, Jones and more, all agree on is this: It takes time to become a successful trader. Borselinno says at least a year; Fisher says maybe 2 years, but they all say this business has nothing to do with instant success. Quite the contrary: Most successful traders say that Survival is the first key to success. Expressions such as, �Love to take a loss� or �Keep the losers small� all provide big clues that, indeed, we must survive to prosper.

As a business consultant, I have often contracted to work with business owners, corporate executives and decision makers to offer fresh ideas on business operations. Throughout the years, I have documented specific cyclical patterns of businesses as they evolve. The remainder of this article cites some characteristics of the 3 identifiable phases that I have witnessed and how I relate them to trading as a business.

Typical Progressions of the Start-Up Phase of a Trading Business

We:

* Are lured by money
* Perceive a low barrier to entry
* Are influenced by �Peer Pressure� news hype
* See that a friend did this and that
* Read a few books
* Go to a few seminars and get all that is freely available online
* Find some speculative capital
* Trade
* Win
* Lose
* Lose
* Find we need the right tools but think we can�t afford them
* Think, �I need to try something more difficult.� even though we don�t understand what we just tried nor do we have the tools or the education
* Lose more
* Understand that we truly do need to work on �planning� and a way to shift our emotions from an adversary with respect to our goals to a powerful force that guides our actions
* Finally, understand that it is okay to take a loss (In fact, we discover that this was the first lesson we needed to learn to survive!)

Survival is actually the goal for the start-up phase. So, then, we graduate to the Growth Phase.

Typical Progressions of the Growth Phase of a Trading Business

We:

* Make a commitment to getting education and the proper equipment
* Actually learn something
* Plan
* Trade with better results
* Decide to make it complicated for some stupid, unknown alien reason
* Lose patience
* Lose
* Simplify again, refining
* Now understand the importance of patience in all of this
* Take more risk
* Are slaughtered by the market(s) even worse than ever before
* Now have trouble pulling the trigger when the set-ups are very clear
* Begin to understand the importance of discipline
* Discover the mechanics of trading
* Learn the life cycle of a trade
* Commit our capital as planned, using strict money management
* Get better
* Start actually accepting responsibility for our own actions
* Stop searching and start focusing (That is the key to graduating to the Maturity Level.)

Typical Progressions of the Maturity Phase of a Trading Business

We:

* Are patient in our endeavors
* Are disciplined enough to trade our plan
* Understand leverage
* Practice strict money management
* Take less and less risk, preferring to use size on stronger signals
* Learn how to handle huge dollar profits but keep our perspective (return on investment versus time to money)
* Find out how to handle huge dollar losses but keep our perspective (return on investment versus time to money)
* Truly understand the life cycle of a trade and can plan accordingly
* Commit to a lifetime of education and learning
* Now trade on auto-pilot, choosing to participate when the best risk:reward ratios exist
* Make our main priority to trade our plan

The bottom line is that many people have traveled this path, but very few have succeeded. I think it prudent as we travel the path to be aware of the natural tendencies regarding the progression of ALL businesses and how we can prepare for bettering our odds through the use of the proper tools and education, as well as serious planning for each phase.

TAKEN FROM: Jim Harrison @ eMini-Master�.com.
----------------------------------------------

I think it will be interesting to hear everyones trading styles, some of which have been posted already.

I consider myself a scalper, not for pennies, but for dimes, sometimes a position may be held for dollars, depending on what type of market it is(range or trending). I gave up on almost every indicator for day trading, but I still like MA's, paintbars for crossovers to keep me in the direction of the trend, volume, candlestick chart patterns, T&S, S/R and trendlines(which are drawn in). I don't use any indicator for entry or exits, its all based off of price action of the stocks I'm looking at and also the bid/ask prices, which are somtimes used to determine breakouts when a trade is printed outside a key level on the T&S. I think all of these are essential. I've used different trading styles, but the most important thing I've learned is specialization of what you are trading by putting in the time to learn it, just like what everyone else on here says.

I atcaully don't use LEVEL II, becuase I already have too many charts to look at for what I'm doing. I'm, sure there are guys who specialize on LII and couldn't trade without it and can pick the axe out easily, but I've found a trading style that doesn't require it, and I believe in the past when I did use LII that I put too much time into analysis of the depth instead of the tape, which is the most important thing for high volume stocks. I use to think that ETF arbitrage wasn't a profitable strategy for individual traders, but I've learned that a variation of this strategy similiar to pair trading works. I have an extensive journal, blog, and sometimes I make videos with camtasia, which is great to look back on to improve my trading. I'm always looking to better my trading, and testing out new ideas, which I think is essential to survival in trading.
More...


That trading plan maturity bit was absolutely spot on. That should be the first thing anyone looks at, before even considering going into this game.

Nice post and thnx. I know it's something I will be coming back to in the future.
 
Quote from Maverick74:

Vehn, I will tell you exactly what I use to tell guys that I trained in NY and what my mentor told me. Pick one stock in the news between $25 and $50 (listed only). Trade it every day. At the end of the day, stay after work for about 4 hours and review all your trades. Pull up the time and sales and review every single print. Look at all your trades, why you did them, why they made or lost money.

Then go back again and see where you should have bought and sold. Don't look at the chart, you don't need it. Just look at the tape. See if you can find the buyers and the sellers. Then the next day come in early. Read every single news headline. Pick your stock for the day, after awhile you will have 2, 6, 10, 15 stocks.

Repeat the same process. Stay late, go over the time and sales. Every single print. You will not have any friends. You will not have a life. You will be very very bored. But you will learn to read the tape. And you will make money. Every guy in our group went through this. Most guys were not that commited and it showed on their P&L.

Like I said, I feel this post is a wasted effort because no one will do this. Oh sure, you'll do it for a day, maybe a week. But for 6 months? I doubt it. You'll look for something easier. Some technical indicator or whatever and you'll give up. It's a lot of hard work and I can't emphasize the word boring enough. But you will learn to trade.

Some hints. Focus on stocks that do 500k to a million shares a day. Don't trade expensive stocks. Don't trade the sexy stocks, the ones everyone trades. Be smart and find related stocks, rather then the stock that had the news. Watch the sp 500 futures all day every tick with your stocks. There you have it.
More...

I like this post for newbies :) I have to say it makes sense. The entire thread looks actually interesting

I have a question. I started paper trading to learn a bit more how markets work, and I like to spend some (not much, having a job) time every day looking at what I would like to trade, and, as you said, what was good and what wasn't.
Although I'm getting better, I have to say that I find it very frustrating that sometimes I really can't understand what went wrong. Not that I don't accept a mistake, but I don't accept it if I don't understand it. This is probably a typical mistake, and I would probably waste quite some money on these trades.
Now my question is: how do you deal with that? Can you understand all your mistakes (don't think so)? How often are you able to find out what you did wrong or right? And for the rest? You just give up? I'm still looking at what I did a couple of months ago...
I know, I can't force the market. The market can do whatever it wants, I don't care. But at least it could tell me why.


Thanks
 
Quote from Maverick74:

Vehn, I will tell you exactly what I use to tell guys that I trained in NY and what my mentor told me. Pick one stock in the news between $25 and $50 (listed only). Trade it every day. At the end of the day, stay after work for about 4 hours and review all your trades. Pull up the time and sales and review every single print. Look at all your trades, why you did them, why they made or lost money.
More...

I have made the move to futures and what I do every day after the market is use SNAGIT to capture the screens on Esignal. Then in Ifran view I can easily annotate all trades, reasons, improvements, emotions and what I was thinking, what I missed and how to do it better next time. Its best to do it after the market so that its still fresh in your mind. For a particular trade close your eyes, draw the chart in your mind in detail, relive the moment experience the positive outcome:) . People tend to gloss over what happened too quickly and eyeball a chart and say tomorrows a new day.
Also as Maverick says watch the S&P 500. With knowing what little I know now about futures I am a much better stock trader.

Hope this helps.
 
General message to this thread. You guys are blowing up my inbox. I appreciate all the PM's and questions but you guys are crashing Baron's server. If there is any way you can post your questions on this thread, I would really appreiciate it. Or PM baron and ask him to increase our inbox capacity. LOL.

Besides, many of your questions will benefit others in this thread as well. So please direct your comments or questions here. Sorry about this, but my inbox is full.
 
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