Well, I already lost half my audience just from the title since no one really wants to hear this. And I’m going to lose a few more when you realize I’m dead serious and it wasn’t a click bait title.
It’s the truth. And this truth bears repeating over and over and over again until people really get it. Far too many are lured into trading by gurus telling them just the opposite. They’re the “watch me turn my tiny $5 account into $125K by summer” crowd. Guess what? They CAN do that. You can’t, especially by simply following them. Sorry, that’s just the truth again. This blog isn’t about HOW they do it. Maybe another time… It’s about how YOU CAN make it as a Day Trader.
So, day trading is hard. I said it’s worth repeating! Anyone that tells you otherwise is dead wrong and they’re probably trying to sell you something. Early in my career, it took me too long to fully understand, appreciate and respect all of this. Hopefully this article will shorten the time-frame for you.
Since trading is so hard, people are always looking for the easy answers. They’re constantly looking for that magic indicator, that magic set-up and/or that magic person to follow. Guess what? The stock market doesn’t believe in magic. Neither should you if you want to trade for a living.
From my standpoint, traders “looking for the magic answer” usually sound something like this in my inbox:
I get what you’re saying BUT wouldn’t it be easier IF…
Wouldn’t it be better IF…
How about I do this instead…
Why don’t you use <fill in any lagging indicator here>…
I heard it’s better to…
I read that…
I think all I need to do is…
15s seem easier than…
Here’s my very short and simple response to these:
There is no better way. There is no easier way. There can only be YOUR WAY and only you can find it. You certainly can and should ask for help along the way, but ultimately it all comes back to you. You must put in the time and effort.
You should read multiple trading books. Attend every trading webinar. Spend countless hours/days/weeks/months and eventually years in front of your screens. Practice. Experiment with small share size. Track your trades. Develop A+ Set-Ups. Keep a journal. Find a mentor. Develop a set of rules that ultimately need to become habits. I’ll even argue you should take a class if you want to shorten the learning curve. Please make sure your mentor and/or the class you take does not just regurgitate trading theory. The theory doesn’t make you money, the actual process does.
Even after you do all of this and do it all multiple times, there’s still something else you must do! And it’s the REALLY REALLY REALLY hard part. It’s the part that will take the longest, be the most frustrating and cause you the most pain.
You must figure out what works for YOU. You must figure out what type of trader YOU want to be. You must figure out what type of trading fits YOUR personality. You must take all the information you've learned, sift through it and put a plan in place that works for you. This is how to develop your process. Keep in mind, often learning from others what NOT to do is one of the keys to success.
Once you do this, you WILL find your niche. You will find what works for you and your personality. You’ll get beyond the theory of trading (what all those books and free information on the internet echo) and master what it takes to trade successfully. You will become a consistently profitable trader. Be patient and grind it out.
Like I said earlier, most people don’t want to hear/read all of this. I probably lost another ½ of the readers by now because some will think I’m coming off as too negative. They want to hear that it’s easy. That’s why some of the biggest con artists and front runners out there have the largest followings. They make it look easy and you’re sucked in thinking it will be that easy someday for you too. You’re tricked into thinking all you must do is keep following and learning their methods and one day... One day…
Your "one day" is never going to happen unless you figure out how to trade in such a way that works for you.
I’ll start to wrap this up with a small piece of advice to keep in mind along your way:
Keep it simple. Don’t over complicate it. Trading is hard enough without us over thinking it. One of the best traders I know summed up his entire process on Friday. It’s was amazingly short but completely accurate:
And notice he didn’t say “magic” formula. There’s nothing magic about it. It took him years to develop and master but that’s exactly what works for him day in and day out.
What’s your formula?
Don’t have one? Start working on it now. You can do this. Need help? Just ask. Just don’t ask for the magic answer. There isn’t one.
Thanks for reading! Questions? Comments? Reach out! Or NEW starting with this blog, leave a comment below!
PS: If you read this and you’re motivated rather than turned off, congratulations! You’re well on your way to becoming a consistently profitable Day Trader! In my next blog Tune Out the Noise, I’ll try to help you out a little more by discussing narrowing your focus. Stay tuned...