I feel your pain. When I started day trading last year in July (I really picked a great time to start didn't I?) I made a lot of mistakes trading as well, and only came out in the black (on my day trading record) sometime in Jan or Feb.
Not that it's any consolation, but they say that most traders only start making money after experiencing the market for 12 months, and also that 95% of people who start day trading, never make it. Sad but true. Saying that, as you spend more time in the market, you will find that you become better at reading things like momentum, changes in trading patterns, even reading charts. As this happens, confidence levels will improve and trading will become more natural.
As to your comments regarding pulling out of trades way too soon or leaving entry too late, or watching a share go up and thinking it can't continue so you don't trade, this is something I know we all wish we had a clear answer for. I don't think anyone can claim to have a methodology which allows them to time their entries and exits perfectly every single time, even the best chartists or most professional traders around.
Here are some strategies or experiences which may help others:
1. Don't chase a share that is running fast too hard. Most often you will buy at the top and watch it fall. Whenever I place an order, I also have a stop loss already set up waiting to push the confirm button as soon as I know that my order has been filled, 2. I watch the chart and buyer depth for each share for which I am in a trade closely. This allows me to detect changes in trading patterns and momentum and trade accordingly. 3. Have a clear trading strategy before entering the trade, but be prepared to change it if required (except for the stop loss strategy of course). Are you doing a scalp, a momentum trade or have a profit point in mind. I always have a quick look at the daily and weekly charts to try and determine support and resistance levels etc. I also look at the slow stochastic to determine if a share has been overbought or oversold. This helps crystallise in my mind the shares potential to move upwards. If I see a strong and confirmed historical resistance level, I will often set my sell order one or two price points below that level. If it subsequently has a clear break out above that point, I will buy in again.
4. Set up a trailing stop loss to lock in your profits on a retrace. Determining an appropriate trailing price point is the most difficult part of the trade, and with very volatile price swings I often leave my stop loss at break even or just above breakeven point, and determine the sell on the fly. In the majority of cases though, I have a predetermined profit point and sell accordingly.
5. Your comment regarding day traders seeming to also hold longer term is quite correct. Some traders, like myself, have a long term strategy as well as a short term strategy and hold shares accordingly. As to day trading, this can involve holding a share for a couple of minutes or a couple of days or weeks even, depending on the motivating factors and strategy behind each trade.
6. Patience in your trades. I often see buys up into the sell stacks, or sales into the buy stacks happening. While there is sometimes nothing wrong with doing this, at other times the market depth is such that it makes more sense to place your buy or sell order in the queue and quietly and patiently wait for the buyers or sellers to come to you. In doing this you will often end up improving your returns significantly (5% in the case of shares at that 10c level). Of course the tricky bit is to determine when exactly to sell into the stack or when to place the sell in the queue. I think that over time and with experience one becomes better at determining the appropriate strategy for each situation.
One last piece of advice is to read as much as you can. Educate yourself by reading as many trading books as you can find, and by reading as much economic and company news as you can fit into a day. AND then, after all that, you need to remember to keep it simple- find what works for you. There are so many different technical strategies and tools available that it’s very easy to try all of them and get paralysed by over analysis. (STAY AWAY from those share trading courses which offer you the recipe to untold wealth for a small initial fee of $5 000, followed by $15 000 for their exclusive trading program etc. These guys are spruikers, almost without exception. The only ones making money out of the courses are the spruikers themselves- if their package was so good they would be out trading the markets, not selling their trading secrets to others for a fee)
lol IPod- saw your post after posting mine. It is MOST DEFINITELY my intention not to be suspended again. The recent suspension was in error by the mod-as acknowledged by MRB in an email to me, and the second one was an unfortunate result of feeling aggrieved about the first suspension and letting testosterone get the better of me again. At the end of the day the mods and admins rule so its no use going against the tide. Thanks for the acknowledgement- nice to see at least someone takes some note of my picks. I too follow your picks and those of kevi, yt, pj, Lindfield and some others, and when certain others post take that as a definite sell signal.
