Article How NOT to Blow your Day-Trading Account

T2W Bot

Staff member
1,462 60
While traders constantly search for new and improved methods on their quest for the ?holy grail? trading system, they often overlook the most significant element that dictates their success. This inherent element is pacing. Proper pacing means you flow with the market. When the market is running fast out of the gate, so should you. When the market slows to a crawl, so should you.
In a nutshell, have you ever made nice profits in the first hour of the trading day only to give it all back gradually throughout the day? Uh huh.
Before I delve too far into this, let?s first start off understanding why pacing is overlooked. Traders tend to believe that a method should be working in all market conditions at all times. When the method doesn?t produce consistent results, the blame usually falls on the method or on the trader (in most cases, the trader blames the method). From there, comes the whole back testing and tweaking process in a tireless attempt to perfect/optimize the method. With...
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leovirgo

Senior member
3,161 156
Use ticks rather than time-based bars. Again, suitable tick numbers have to be used for different stocks.
 

nandk98

Newbie
1 0
Market definitely has its phases but its direction doesn't always fall in predictable time slots. In the Indian context, I have noticed good movement (either upward, downward or composite) during the first 60 to 90 minutes. Later for nearly 2 hours it goes into some sort of listless movement; and momentum returns during last 60 to 90 minutes. But there are days when the listlessness is absent and there is continuous movement. I recommend staying away during the listless timeslots.
 

greck0

Newbie
1 0
I have only been trading for a short period of time, but i have been paying attention. there are distinct slots of activity. The problem with physically leaving from what i see arises when you have unallocated capital you want to invest based on events, ie positive seismic survey results in oil. Yes, most news will come out ordinarily at 7am, but there are stocks who come out with great news at random moments.
I need to introduce pacing in some form to my life, but i have been unable as of yet. I can imagine burning out from doing this full time. By being more prudent with one's time, you may miss the odd upswing but you may win in the long term.
 

heywally

Newbie
4 0
I think that there were good points in this piece but I question the statement:

"No method works in a flat market, so stay out of them"

Assuming you are holding positions overnight, buying weakness and selling strength should work in a flat market unless it never moves at all. The trick would be in knowing that you are in a narrow range or flat market.
 

ben dog

Junior member
18 0
Thank you mr Yu, for a great article. Appreciate it :O)
 
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