Day trading rules

Day Trading Rules #1

KNOW YOUR MARKET. The best day traders specialize on only a small number of indices, or stocks, and get to know them intimately(for instance focus on trading warrants or goring stocks). The authors of the Camarilla {b} Equation themselves day trade the S&P 500 Index almost exclusively, unless a REALLY interesting opportunity pops up. In this way, over time, you will naturally become attuned to the rhythm of your chosen instruments, and will come to have a 6th sense as to when you should and shouldn't trade.

Day Trading Rules #2

DON'T BE GREEDY. Do NOT try to squeeze the last tenth of a point out of each day trade: This is a huge distance - you can easily afford to be slightly late on your entry and slightly early on your exit. By never hanging on for 'top dollar', you won't suffer the pain of seeing a winning trade somehow turn into a losing trade. Or if you are holding huge quantity try to lock in some profits first by selling example you have 1k lot sell 300 lot first when a stock move a few bid from your buying position. At the end of the day apply wysiwyg(What you see is what you get rule= which also means if a stock start dropping sell it, if its going up keep it.) Remember hope is the number 1 enemy of a trader!!!

Day Trading Rules #3

TAKE A LOSS WHERE NECESSARY. Most day traders who fail do so NOT because they can't create winning trades, but because they fail to kill their losers soon enough. Knowing when to take a loss is the most important lesson any day trader ever learns. If you keep your losses small, you can come back to fight another day. The way to think about this is to cast your mind back to school - exams consist of many questions. You can get some of the questions wrong, it doesn't really matter. The end result (i.e. the overall score) is the important thing. In the same way, if you have a bad trade, so what? As long as you control the loss in a calm, professional way, keeping it within the limits you have set for your money management strategy, it is STILL a good trade! It is how your profit & loss looks at the end of the month that is the important thing.One note to this - we have found that if you have 3 losers in a row, it is best to take the rest of the day off, as you are obviously out of tune with the markets - it is important to focus your attention when day trading commodity or futures contracts. Cut losses fast and let profits run!!!

Day Trading Rules #4

DON'T CHASE THE MARKET. If you are slow, and miss a day trade that suddenly looks like it would have made you a fortune, do NOT panic and try to jump in late - you will almost certainly be buying the top or selling the bottom. Remember that the market will be there tomorrow, and the day after, and for ever, so ANY trade, no matter how important it looks, can be ignored if necessary. Keeping your powder dry, and being ready for the next one, is more important than hitting every day trading opportunity you see. Many successful day traders only trade for a few hours a day - they miss plenty of action but don't care, because they know the market will be around when they come back.

Day Trading Rules #5

DON'T OVERTRADE. Similar to rule number 6, don't ever trade unless you are ABSOLUTELY sure. Never day trade because you are bored, or need some excitement, or hand itchy . Buy a Sony Playstation instead. Sometimes an entire day goes by, and the Camarilla levels are not hit. You may look at the charts and think you see lost opprtunities:- relax, what you actually see are instances where the floor traders will bank your cash. Stay detached from it, and remember that if today was a chop day, tomorrow will probably trend well, and enable you to make easy profits. Learn to sit on your hands!

Day Trading Rules #6

TRADE WITH THE TREND. It doesn't matter how strong a swimmer you are; if you try to swim against the tide, you WILL drown. Trying to pick tops and bottoms is the easiest way to the poor house. The market is perverse - it can ALWAYS go higher, and it can ALWAYS fall lower than you imagine possible. And it will ALWAYS do this in a way that causes the MAXIMUM unpleasantness to the MAXIMUM number of people. Sticking with the trend puts you on the right side from the start.

Day Trading Rules #7

CARE MORE ABOUT PROTECTING YOUR CAPITAL THAN INCREASING PROFITS. You will do best in the markets if you worry more about stopping losses, than if you try to focus on making money. This sounds hard to believe, but it is true. The markets are a giant money-making machine; if you can latch on to them, you WILL make money. The price of this free ride, however is to understand that the beast will buck and roll around and generally try to dislodge you, and you have to know when to let go. The root of good money management is to control to the dime how much you are prepared to lose on a day trade. At SureFireThing, we seldom commit more than 5% of our working capital to any individual trade. Mostly we pull a trade if it costs us more than 2%. We would have to suffer an INCREDIBLE string of losers in order to go broke, and we recommend that you do the same. If you do not have sufficient capital to day trade expensive instruments, we suggest you save some more before trying. Being undercapitalized is almost as bad as not controlling your losses.

Day Trading Rules #8

BE WARY AROUND NEWS ANNOUNCEMENTS. It is a bad idea to be holding a position just before a major news announcement (e.g. the release of the jobless figures). You are not smart enough to know how the markets will react to the news, and are therefore guessing. Don't do it! To make your life easier, here's a link to a great Calendar site, who usually spot (and categorize!) all the major upcoming.

Day Trading Rules #9

Never get marry to a stock. Which also means never fall in love with a stock be like a playboy. Go in to uptrend stocks and get out the moment it widraw. Go in again when the uptrend continues. Don’t hold like an investor and keep holding when the stock is going down down and down. I know a friend who took Maybulk-ca when it was 7-8ct he fell in love with the stock find facts and fundamentals of a stock. Keep telling me non-stop EPF IS BUYYYINGGGGGGGG. In the end from holding 1k lot he average up to 5-6k lots out of madness. Taking all the highest prices when no one is taking. In the end he lose more than 20k which is 70% of his cap!!!

Day trading rules

Day trading rules

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