If you’ve been Day Trading for a while and you are experiencing loses, or your winnings are dismal to the point of being depressing, you should consider the five points listed below very carefully. One or more of them will likely explain why you are having this experience
Not having a Journal
You need to keep record of your tradings, not only the winning ones, all of them, there is always something to be learnt, even from the losing trades, so get in the habit of keeping a log of all your tradings.
Overtrading
Trading more than your capital allows, or trading more times than you should, are two sides of the same sin. Most of us, have sometimes been guilty of it. Successful traders don’t jump into every possible trader, successful traders are like wildcats, waiting for its prey, AND in the most advantageous circumstances. So, become a Wildcat at day trading!
Lack of a Trading Plan
Markets behave randomly, according to supply/demand, however there are times where a trend is clearly defined, and those are the moments in which the probability of success is higher. Identifying those trends is not an easy task, and sometimes once you take a position something may go wrong. That is the main reason to have at least a short term plan. Something like setting the minimum winning target point and the maximum losing target point is a good start
Lack of Focus
Never trade under any distracting circumstances; Day Trading needs attention, so never trade, if you have a personal, professional, or any other particular problem which takes your mind away from Day Trading, besides, from a psychological point of view, you may make wrong trading decisions. Trading on such a short time frame requires you to be able to make split second decisions, and you’re risking a lot of money when you do. Make sure your mind is sharp and your emotions are centered when Day Trading.
Lack of discipline
Abide by your rules, mistakes are costly, and your money is on the line of fire. Never depart from your rules no matter how good a trade “looks” or “feels” to you if it violates your objective and back-tested rules.
In summary, EACH of the items listed above is critical to your day trading success.
Happy Trading!
