Day Trading and Your Life.

safvan

Established member
515 34
Trade volume with price along with the trend. Whether you day trade or swing or position the odds are in your favor.

I personally do not day trade because I am not that intelligent and capable enough. I rather wait a day to two to be proven wrong than 2 to 3 times a day. My brain would explode!

In order to consistently beat ANY market, all you need is

1. Volume
2. Price
3. A trend that is supported by strong price action in the desired direction.

I am pasting a link to a simple yet extremely profitable screener. The stocks listed are between $1 to $10. You can trade them once the trend lines are broken or about to break.

http://finviz.com/screener.ashx?v=211&f=ind_stocksonly,sh_avgvol_o100,sh_price_1to10,ta_change_u,ta_perf_4w20o,ta_sma20_pa,ta_sma200_pa,ta_sma50_pa&ft=3

Patience for the right opportunity to arrive and the boredom associated with it is the biggest challenge for traders. For day traders its even harder where they trade because they need to trade.

Good luck and profit well.
 

Splitlink

Legendary member
10,850 1,231
Problem with trend trading is you only know after the event there was a trend.
That is all you know about anything, but a trend that has been identified on the 5M TF can, if wrong, be exited with little loss, with the advantage of a very attractive risk/reward factor that can develope into a profitable run.

I hope for trends because that is all I can do after I have arrived at a decision to enter. If I am stopped, too often the reversal starts right on my stop and I have to get in again, quick. So be it.

I believe that my refusal to tolerate more than a small loss makes the difference between my success and failure in trading. So many lose because they refuse to accept that they are wrong.

IMO, if one uses volume one should be on very a low TF, 1 or 2 minutes, otherwise the benefit of volume is lost to a day trader. The object of daytrading is, after all, short term. For instance, on a 15M chart where, on that bar, did that peak in volume happen? The first minute, the 6th minute, or when? If you can't tell that, or you consider it unimportant, forget it, it's gone.
 

safvan

Established member
515 34
Problem with trend trading is you only know after the event there was a trend.
Depends on how you look at it. I do not know how one can define a definite trend in an instrument by looking at anything below the daily charts. It takes a great amount of money flow to change a trend in an instrument that is highly liquid. A lot of money has to be put IN and taken OUT before you can see a visible crash or start of the bull market. The signs of markets dying started 2007. It was not a one day change.

Personally I could never figure out how one can profitably trade a 15 minute or 2 to 3 minute chart without actually defining the major money flow condition by determining the current trend. Every thing is linked to the bigger picture in one way or the other. Chances of success in day trading are related to this as well.

Peace.
 

malaspina

Active member
114 1
I was wondering if anyone of you has any more information about this topic: Please read...

The government is trying to destroy the stock market

Apparently the government is trying to destroy the stock market. There is a new proposal to tax .25% of all stock, bond and option trades. The thought process here is to let Wall Street pay for Wall Streets mess. But that will only fool the uninformed. The ones that will suffer and you and I. Keep in mind that the vast majority of retirement funds and private retail investments are held in mutual funds. If this tax goes into effect, the mutual fund companies will have no other choice but to pass that cost along to you dear friends. This will reduce your returns and seriously hinder your investment returns. Or take a day trader for example. If he uses $10,000 for his small trading account and makes one round trip trade per day, that will be a $250 tax bill per week! Said another way, he will have to overcome an initial cost of 2.5% of his capital each week in order to make money. How many traders will stay in business if they have to make 2.5% each week in order to break even? Not many I can assure you. What does that mean to you if you don't day trade? It means a reduction in liquidity in the markets and larger spreads between the buy and sell price. It means the volume of trades declines which means the values of stock declines. Brokerage firms will likely struggle, some will go out of business. More unemployement in the finance sector. Individual traders didn't cause the economic crisis. Big Wall Street executives making overleveraged bets with other people's money along with stupid regulators and politicians caused the crisis. And you and I, the taxpayers, are the ones who have funded the bailouts. Now the government wants to tax you even more in order to shore up the governemnts spending. Let's call this what it really is, 'government confiscation of another $150B of taxpayer money'. Please visit this site to sign the petition to block this tax.

Tell Congress to Block the Trader Tax | James DePorre

Taken from: The government is trying to destroy the stock market

Yours,
 
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tuscan

Member
91 1
"I do not use market profile, I use market depth instead while day trading. Market depth is a tricky thing to learn, you need to watch the tape daily for a while to understand what the top sharks are doing."

1. You can't use market depth "instead of" market profile because market profile is just a technical tool and market depth is a list and number of workin orders on the exchange, it is the order book
2. "Top sharks" are on dark pools , transactions which are not in "the tape"
3. You won't understand that game looking at the volatile instruments you are talking about, look at the sum of displayed working orders and the volume and have a thought

I could go on...

I have traded eurex instruments where there was 5 ticks a day range with a 1 million a day volume... with 100-200 lots- this is the market where it matters
 

malaspina

Active member
114 1
Will the NASDAQ downtrend continue ?… I don´t know.

Hello dear traders,

The NASDAQ is in a clear downtrend, will it continue in the short-term?. I really do not know, I just know that today the trend is down and I will place my bet based on that probabilistic fact, I could lose or I could win, I will sure try to lose as little as I can and I will try to cash in as much as the market is willing to give me.

You can always place some swing trades if you need to be away from day trading for a few days or you could day trade one contract and swing trade others. In this example I want to work with the NASDAQ contract for a swing trade.

If you look at the NASDAQ chart, I am trying to find a good entry area where to place a short bet. I will do it where the risk is low and the profit potential is high. Look: “The index is in a clear downtrend, then I will only swing trade from the short side“. It is very important when swing trading to place your bet along with the strongest force in place, right now this force is in on bears hands.

Now, Where and when do I place my short trade ?. My best advice to you is that this bet should be place once we have price confirmation that resistance will hold and there is price continuation to the downside. Remember, PRICE CONFIRMATION is one of the most important things to take in mind before placing your trade. You have to study how the price have managed during the day (new lower high ?, new lower low ?, range?, new lower close ?. The last, the closing price of the bar is one of the most important information when trading, the closing price reveals what is the most recent market sentiment about value. Once you let the market speaks before you place your trade you remove most part of the guessing factor out of the equation. You will gain less money if your trade goes your way but you will lose a lot less. Remember, in trading, it is not important what you make, it is important what you keep.

I am still looking for where to place my short order on the NASDAQ, will the market speak to me ?, I am sure it will, it always does ….. good trading to you.



Yours,
 
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malaspina

Active member
114 1
RED ALERT, RED ALERT !!!: NASDAQ is going down.

Hello dear traders,

This is just a quick post to let you know that NASDAQ index is going down as I write this. I already took partial profits off my original position. I am still on the play, who knows how far down it will go. I will try later to post an explanation of my short trade. I told you in my previous post that I was looking for an entry in a short position, I found it, I played, I already took partial profits and I am still riding the wave. Let´s see how the market closes to move my profit stop order.

Note: This is a swing trade.



Yours,
 
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malaspina

Active member
114 1
Hello dear traders,

This is just a quick note to let you know that I have closed my short position this morning taking profits. I don´t know if this will be a brief halt of the downtrend yet. We will need to wait for the market price action during the next days. If so, I will be looking for a new short play if the downtrend remains intact. I will keep you posted on these swing trades I will be placing.

Yours,

Humberto.