Day Trading Tips and Tricks

April 3, 2024

Indicator Warehouse

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5 Ways to Sabotage Successful Day Trading

Successful Day Trading with NinjaTrader Let’s face it. Trading is TOUGH! Impossible?  No.  Difficult?  Yes. It takes a lot of work, failure, and experience to make it.  Yes, this “Shangri-La” of profitable, consistent successful day trading is attainable and reachable, but the path to get there is no cakewalk.  Anyone that tells you otherwise is either lying to you or hasn’t tried it themselves.  That said, many times the difference between successful day trading and failure only involves NOT doing things to destroy the outcome.  Avoiding things that hurt our chances of success is certainly a great idea right?  So why do we continue to do them?  I think it’s because we may not even know we are doing something detrimental to our trading approach.  I have attempted to compile a short list of standard practices that might begin well intentioned but end up working against us in the end.  How do I know?  Because I have done, every single one of the “self-sabotage” items listed.  You may recognize one or two or all of them from your experience.



Trading Loses and Successful Day TradingYes trading can be oh so exciting!  I still love the whole idea of pulling the trigger on a boatload of money and competing globally to be “right” with the reward of healthy monetary gains if I am.  But when I started, I became WAY too enamored with trading.  It became so engrossing, it engulfed my life.  I avoided social events, friends, family and beloved sleep just to stay in front of the market.  The result?  Spending so much time in front of the computer trying to trade had two negative impacts:  The first was that since I was spending so much time in front of the computer it became the center of my life.  I paid no attention to anything else and relationships, housework and everything I was working so hard to enjoy.  I became a hermit and lost that important balance that leads to a happy life.  The second impact was that since I was so addicted to trading, I couldn’t step away and avoid bad markets.  I traded when I shouldn’t have because I just couldn’t stop and that cost me dearly.  Sure trading is great and you will learn the most when you are interested in something, but making it the center of your life is not a good idea.  Take a step back and you can see the forest instead of the trees and remember the pursuit of trading is more than the trading itself, it’s a better quality of life.



Greed and Successful Day TradingThis goes hand in hand with #1.  In the difficult venture of successful day trading, making more trades DOES NOT equal more profits  I learned the hard way, that attempting to take every single setup does not turn a good system into a monster money maker.  Over trading exposes your capital to the market way too often, places too much of your money at risk by having too many orders open at once, and makes you not take the time for each order to do the proper analysis.  Instead of trading five to ten instruments and getting 20-30 trades per day, I have found focusing on one or two instruments has equated to more profit.  The reason is that now each trade requires lots of checks to get off the ground, and by slowing things down there is more chance you will only choose the very best trades.  Also, managing so many trades at once can be anywhere from stressful to impossible.  Lastly, by only taking a few trades, you open yourself up to much less risk if the market is bad.  After all, there really are plenty of times where we should just stay out and wait until the next week.  By constantly placing trades, we might miss the signals to stay on the sidelines.


System Jumping

Focus and Successful Day TradingOh boy, was I guilty of this one.  When I started trading, I was SURE it was just a matter of finding the right system for me to make money.  I pretty much tried every system that came into my inbox.  I bought trading robots, manual systems, signal services – you name it! All in the search for the “holy grail” of trading.  What did I find after losing tons of money in both cost of systems and to my account?  That a system only plays a part in the goal of successful day trading.  Sure it’s important to have great tools, but it’s even more important to stick with them and truly understand them.  Knowing the difference between whether it was the system, market or you as a trader causing the loss is impossible to determine if you are constantly going from one system to the next.  Sure it always seems the “latest and greatest” release will FINALLY be the answer to your trading woes.  But in reality, the work must come from within.  After all, a great trader can make a bad system work better, and a bad trader can destroy a good system.  Sticking to one system and truly understanding it can give you confidence both when and how to use it.  I think it’s much better to stick with a bad system until you know EVERYTHING, rather than going from one good system to the next.  By sticking with the bad system, we can learn from the consistent mistakes.  On the other hand, jumping around is likely to produce results we just can’t analyze.


The Blame Game

mistakes in Successful Day TradingYes, we have all done this at some point.  We blame our bad trading on the market, the system we are using, luck, our broker or even “the man holding us down” in the sense that the whole deal is rigged.  One thing we rarely blame is ourselves.  Interestingly enough, that’s usually the problem.  But due to pride and a whole host of other reasons, we simply cannot accept that we may be the problem.  One of the fastest ways out of the red and into good trading is to OWN YOUR OWN TRADING!  Yes, YOU are the captain.  It’s YOUR decisions that matter. Don’t depend on anyone else and don’t blame anyone else.  Even if someone gave you a stinker of a recommendation and it lost, IT’S STILL YOUR FAULT.  After all, you didn’t HAVE to take the trade right?  Why are you letting others make your decisions?  The best way is to recognize your role in successful day trading, develop discipline, get good education, and practice to improve our skills.  Be in control, the buck must stop with YOU.


Call of Duty

Money in Successful Day TradingToo many times, we approach trading very cavalier, like it’s a video game.  Sure the colors can be pretty, and all the movement exciting, but if you don’t take it seriously, you won’t get serious gains or results.  Many times we use trading as a way to relieve stress, entertain ourselves, or for the “rush”. As long as you don’t care about losing money, trading for entertainment is fine. Remember, the traders you are up against include people who are VERY dedicated to winning.  Be one of THEM.  Why?  Because only about 5-10% of traders are profitable. The difference that separates them is attitude.  We all trade the same market. People who take trading as serious as brain surgery are likely to learn more, trade less and be more disciplined.  If you want to make money, this is NOT a “fun pastime”.  Work on a measured approach that includes written rules for every aspect of trading.  Also, psychology plays a part.  If you don’t come to the market with a clear head, focused on trading, you are likely to make poorer decisions than if you did.  Keep your head in the game, but don’t treat it like one.

One thing I have learned in my years of trading and working with trading customers is that your number one enemy and hurdle to day trading success is not your trading software.  It can and usually is you!  By avoiding these 5 pitfalls, you can transform yourself into a serious day trader with the confidence of knowing you are positioned to win! 

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April 3, 2024

Indicator Warehouse

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