The majority of traders are looking for entries with a very high probability of success. Web sites and book stores are loaded with day trading advice to fill this "need." Some of it's pretty good entry advice. A lot of it is average, which is actually not a good thing. But good or average, if they are leading you to believe that "If you can find better entries, you'd be making money." Than this is poor day trading advice, it's a lie and they are taking your money and they are taking you for a ride.
Those are thoughts I had almost every day, before I quit the safety of full time employment and decided to strike out on my own. I asked myself the same question day in and day out; surely there has to be a better way. What about the internet, I wondered, isn't that supposed to be bringing new and exciting opportunities to all? I researched a lot of so-called work-from-home opportunities that promised untold riches, apparently mine for the taking just by sitting in front of my PC. Needless to say, in reality those schemes turned out to be about as fulfilling as, well, filling envelopes for a living. No, I knew there had to be another way - something real - something where I could be in control of my own destiny. And then one morning on the train to work, I read about a couple of Wall Street boys who had struck it rich thanks to some huge bonuses, and was now going it alone setting up their own day trading shop.
If you're going to make it day trading the stock market, and actually be successful at it, you must understand why this is, and then you'll program your reflexes to follow your knowledge. Think of it this way...large corporations spend millions of dollars inventing boatloads of products that are worthless. But in the early stages of research and development, the company can't tell which products will make money. If they take all their new products to market, and only a few sell, the few won't offset the losers, and the company will go under.
Most new companies (about 95% by some estimates) fail. The same is true of traders, they want to be successful, but just don't know how to go about it, which day trading advice should they believe, and who's just trying to take their money. But there is an upside to all of this, successful companies know a secret. They find a way to identify their losers in the early stages... and close the projects down quickly before losing a lot of money in the marketing process.As James Surowiecki puts it in his book, "The Wisdom of Crowds"
"...companies place huge bets on losers all the time. What makes a system successful is its ability to recognize losers and kill them quickly." The same is true of stock trading strategies. Experienced professional traders place bets on losers all the time, but they know how to identify losers and kill them quickly before much (if any) money is lost.
I close bad trades well before my hard stops are hit, but anyone can do that. But, you also have to recognize your losers early. Otherwise you'll be killing your good trades along with the bad ones. Every successful trader I've met has a way of getting out early on bad trades. If you are day trading support and resistance, I can teach you how I do it. You may be able to find a way to do it on your own, but it will probably take years. I've been trading for more than 27 years, and publishing my day trading advice on the internet since 1996.
Those are thoughts I had almost every day, before I quit the safety of full time employment and decided to strike out on my own. I asked myself the same question day in and day out; surely there has to be a better way. What about the internet, I wondered, isn't that supposed to be bringing new and exciting opportunities to all? I researched a lot of so-called work-from-home opportunities that promised untold riches, apparently mine for the taking just by sitting in front of my PC. Needless to say, in reality those schemes turned out to be about as fulfilling as, well, filling envelopes for a living. No, I knew there had to be another way - something real - something where I could be in control of my own destiny. And then one morning on the train to work, I read about a couple of Wall Street boys who had struck it rich thanks to some huge bonuses, and was now going it alone setting up their own day trading shop.
If you're going to make it day trading the stock market, and actually be successful at it, you must understand why this is, and then you'll program your reflexes to follow your knowledge. Think of it this way...large corporations spend millions of dollars inventing boatloads of products that are worthless. But in the early stages of research and development, the company can't tell which products will make money. If they take all their new products to market, and only a few sell, the few won't offset the losers, and the company will go under.
Most new companies (about 95% by some estimates) fail. The same is true of traders, they want to be successful, but just don't know how to go about it, which day trading advice should they believe, and who's just trying to take their money. But there is an upside to all of this, successful companies know a secret. They find a way to identify their losers in the early stages... and close the projects down quickly before losing a lot of money in the marketing process.As James Surowiecki puts it in his book, "The Wisdom of Crowds"
"...companies place huge bets on losers all the time. What makes a system successful is its ability to recognize losers and kill them quickly." The same is true of stock trading strategies. Experienced professional traders place bets on losers all the time, but they know how to identify losers and kill them quickly before much (if any) money is lost.
I close bad trades well before my hard stops are hit, but anyone can do that. But, you also have to recognize your losers early. Otherwise you'll be killing your good trades along with the bad ones. Every successful trader I've met has a way of getting out early on bad trades. If you are day trading support and resistance, I can teach you how I do it. You may be able to find a way to do it on your own, but it will probably take years. I've been trading for more than 27 years, and publishing my day trading advice on the internet since 1996.
About the Author:
Frank Miller has a Debt Consolidation Blog & Finance, these are some of the articles: The Responsibilities Of A Bankruptcy Trustee Calgary Residents Should Know About You have full permission to reprint this article provided this box is kept unchanged.