12 Mistakes that will make you awful at day trading
Hey, we’ll be the first to admit it. It’s pretty easy to screw up day trading if you have no clue what you’re doing. However, there is also a lot of good that can come from becoming a good trader. So, how do you do it? First off, avoid making any of these mistakes and you will have an edge on most of the beginners just trying to figure out the stock market.
1 – Jump In Without A Price Target
Here’s a quick way to tip off others that you are clueless about day trading. Buy a long position without any goals in place. Don’t bother considering what level of profit you would like to see or the stop-loss level you can live with if the trade goes south on you. By not having price targets set to work within, you get to prove that you are not very good at money management.
2 – Impatience Is Golden
You may spot them. You know, those traders that sit idly by their computers watching and observing things. They pay attention to details and plot their next move. That’s pretty dull and far too organized for you. Ignore those guys and just go nuts. Trade all day, every day and you’ll see a lot of action. You’ll also show those other guys that you really are off the chart.
3 – Order Often
Again, there’s day traders who sit and think and strategize all freakin’ day or week. They say it’s because they are carefully planning their trades. That’s dull and boring. The only way you’ll get ahead is to click the order button frequently. The more often you do, the more trades you can get in action. It’s a move that will get you noticed and people will start to stare at you.
4 – Trade With More Than You Can Afford
Sure, the smart guys will avoid this move. They say it’s foolhardy. They claim it’s a ginormous stock market error that can set you back so far you’ll never recover. We say phooey! There’s nothing worth doing if you can’t handle a bit of serious risk every now and then. Well, unless you jump out of a plane and forget your parachute. Not using a trade budget is a lot like that.
5 – Stick With Only Stocks
Think about this for a minute. Why do you think it’s called a stock market? Why do you think it attracts day trading? That’s because day traders are interested in stocks. Some may say that you should mix it up a titch. You know, throw in Forex, options and some futures. That’s for pansies. Even penny stocks are more fun than those. When you day trade stocks, just do that. Then maybe someone will pick up on your moves.
6 – Always Second Guess Yourself
Do we even need to explain this? Whenever you suffer a loss in the market, it was probably related to the fact that you made a bone-headed decision. Day trading is not for losers. You need to win and win all the time in order to succeed. Ignore those traders who say otherwise. Unless they happen to drive a Beemer. Flipping back and forth on trades is also fun for everyone!
7 – Supply And Demand Is Just A Gimmick
There are a lot of traders who follow supply and demand data. Yuck! As if that helped anyone in business. As a day trader you are sort of a solo pilot. You don’t need no stinkin’ charts filled with data that only rocket scientists can decipher. Nope. You can make your own decisions and toss caution to the wind because that’s how the West was won…without gimmicks.
8 – Risk/Reward Ratios Are Too Restrictive
You’ll find a lot of beginners plotting something called a risk/reward ratio. A common figure used is 3:1. So-called experts call it a lose small and win big strategy. Well, we know where that’s going so to be any good at day trading you must avoid such nonsense. Go big or go home should be your motto and it’ll get others thinking that way as well when you start winning.
9 – Discipline Is For Criminals
The common thought about day trading is that in order to be successful at it, in addition to all the other bunk you’ve read about, is to be disciplined. In our mind the only people who should be disciplined are those who did something wrong. By being a free agent you have the ability to do whatever you please when day trading. It’s a lot more fun without a lot of guidelines.
10 – Blow As Much As You Can With A Big Trade
We find it amusing that those so-called experts like to push the concept of budgeting how much capital to risk in a single trade. They probably also slow down for yellow traffic lights. Back to our go big or go home philosophy, clearly there is some kind of discrepancy here. In order to get into the big leagues you can’t do it by taking just baby steps. Go all in or it’s not worth it.
11 – Never Trust What You See On The Internet
One of the biggest mistakes day traders make is to refer to Mr. Google for advice. With all the fake news out there you can’t be sure anymore if that news report about an oil crisis in the Middle East is even true. That’s why it’s always better to just spin a wheel, flip a coin or see your Tarot card reader before firing up your day trading computer for the day.
12 – Mistakes Teach You Nothing
Forget what they said in school about mistakes teaching valuable lessons. All mistakes are is reminders of bad decisions. The best way to avoid that is to never refer to a mistake with that term. On the offhand chance you have a trade loss call it a ‘financial malfunction’ which indicates it can be fixed. Blame shifting is king if you are a day trader.