Daytrading Stocks & Index Futures

Hi All,

As far as I am aware, there are no good Irish boards for Irish Daytraders to converse and share ideas. Hopefully, this will become the first.

In fact, I don't think that there are too many Irish Daytraders out there ?

I will try and make this thread interesting for those that want learn about Daytrading, noting its many advantages and disadvantages.

Feel free to ask any question you like, and if I don't know the answer I will tell you straight away. I do not pretend to know something that I don't, as this can cost you bigtime when you are trying to take money from the big boys who control the markets.

Do not ever be afraid to ask a question, for without asking how is one to learn anything of value in life !

Before we start, let me first mention that in order to have any chance of making money Daytrading, one must first pick the best markets to trade. I will intentionally try and keep away from the textbook stuff, as most of it is nothing but rubbish, but at times it will be the only way that inexperienced traders will be able to associate with what I am saying, so I will try and phrase my posts so that they can be understood by all.

The best Stock Market to Daytrade is the Nasdaq, then followd by the NYSE. As people ask questions, and answers are given, it will become apparent why this is so.

All I will say for now, is forget about Daytrading Irish or UK shares, it just does not work, for many reasons, the main ones being volatility and liquidity.

So, with that, the bulk of the discussions on this thread will be in relation to the following markets:

1. Nasdaq Stocks
2. NYSE Stocks
3. S&P 500 Mini Futures - symbol is ES on Globex Exchange
4. Dow Mini Futures - symbol is YM on ECBOT Exchange

These are the 4 main markets traded by Daytraders worldwide, and the ES on Globex is the most liquid of them all, but can also be the hardest to trade. Remember, the most liquid markets will have the best traders assigned from the big institutions, so to take money from these sharks, you need to be very good and have the correct setups for trading. Many traders have lost a small fortune trading the ES alone !

Next, after identifying the best markets to Daytrade, one must pick a broker that will give acces to all of these markets. Some of the most important things to consider when selecting a Broker, are:

1. Industry Leader - if the go bust you will get your money back !
2. Commissions and margin requirements - the lower the better.
3. Live Data Feeds via internet with low cost data subscriptions.
4. Charting facilities - not as crucial as the first three, but can save you a lot of time and hardship if your chosen broker has live charting features as standard.
5. Demo trading facility with live market data - crucial for beginners !

For the purpose of this discussion, I will be suggesting that those who are serious about daytrading consider looking at IB, or Interactive Brokers, as they are one of the brokers that I use.

Selecting a broker is a personal choice, so no more on that, but just make sure that your selected broker fullfils the basic 5 requirements as set out above.

Do you do this fulltime?

This is something I am very interested to get involved in.
What kind of initial outlay are we talking Article43?

Very interesting as i would like to get into this.

Hi Guys,

I am glad to see that we have some genuine interest and I will answer your questions as best I can. Remember, anything worthwhile requires hard work and dedication. Do not be fooled by the scores of websites that offer systems with an 80% win rate, as common sense should tell you that this is nothing more than a sales and marketing gimmic. Making money, no matter what way you do it, is always hard. Finding the best way to do it, for the least anmount of risk, should be top on the priority list.

AS we continue, I do not have available time all of the time, so if I post with spelling errors or whatever, than that is how it will be. I am not here to improve on my English comprehension, I am here to share my experiences with others, as sharing is good, and those that share will always receive, it is how things work.

Do you do this fulltime?

Yes and No, and I am not being smart.

I have done it fulltime for 1 year in the past, meaning no other income apart from daytrading, but that was a big mistake. Well, it should not be called a mistake really, as mistakes are nothing but past experiences that we learn from. In a nutshell, if you are under pressure you will make mistakes, and being under pressure when trading will only result in one thing, and that is losing your money.

Do I trade live now ?

Yes, I do. I currently trade the ES and FTSE 100 futures, and Options, but forget about Options for now as they are far more complicated than daytrading stocks and index futures. Options trading requires its own thread. I can do this along with what we call a normal job, and this is the approach that I would recommend to anyone that asks me. Unless you have a lot of money, and I mean around 500K+ Euro, then forget about daytrading as the only job you do.

This does not mean that you can't daytrade. We in Ireland have a big advantage over our US counterparts, and that is the time zone difference.

The US stock markets close at 9pm our time, and there is even extened hrs trading, but that can be dodgy and is best avoided.

As we speak, the ES is at 1470.00, that is -5 pts or $250 for 1 contract.

The YM is at 13309, -40 pts or $200.

FTSE 100 futures are at 6329, -84 or 840 quid sterling !

This is something I am very interested to get involved in.
What kind of initial outlay are we talking Article43?

Well Mike,

If you are level headed, are willing to do the required work and learn, and willing to lose some money in the form of live trading (this is going to happen no matter what you do !), then about 5K euro should be adequate.

A bit less might do, but 5K is OK.

The initial goal is to learn - after all, we all had to crawl before we could walk, did we not !

Hi Article43, I agree there is little discussion around Irish forums at present and I wish there was.

Where you will find some discussion is :

www.askaboutmoney.com
www.askaboutshares.com
www.arandomwalk.com
www.thepropertypin.com Central Bank section.

non-Irish : www.trade2win.com

I have some questions.

Why are you starting this here/now? (As a new posters I have to look at any advice you give more skeptically than usual.)

Are you planning on giving tips or are you looking for open discussion about certain shares or strategies?

So far what you have posted I'm taking as :
1. Only trade in highly liquid stock indexes
2. Get a broker that provides you with real-time info & execution & is cheap
Correct?

What advice are you planning on supplying next? (a brief content before an indepth post would be appreciated)

What is your background?

Using non-Irish brokers/stocks such as Nasdaq will result in tax problems potentially.
How do you propose handling these?

I think they're all pretty fair questions and warrant answering before providing much more info.

Thanks.

Ixus

Very interesting as i would like to get into this.

Yes drdre,

Not only is it very interesting, but it is also the only job where one can make good money without having to have any qualifications in anything. In this day and age, that is a very rare thing indeed.

The markets are like a big Casino, but with a major difference.

Do you want to try and answer as to what the major difference might be between a Casino as we know it, and trading the markets ?

Hi Article43, I agree there is little discussion around Irish forums at present and I wish there was.

Where you will find some discussion is :

www.askaboutmoney.com (http://www.askaboutmoney.com)
www.askaboutshares.com (http://www.askaboutshares.com)
www.arandomwalk.com (http://www.arandomwalk.com)
www.thepropertypin.com (http://www.thepropertypin.com) Central Bank section.

non-Irish : www.trade2win.com (http://www.trade2win.com)

I have some questions.

Why are you starting this here/now? (As a new posters I have to look at any advice you give more skeptically than usual.)

Are you planning on giving tips or are you looking for open discussion about certain shares or strategies?

So far what you have posted I'm taking as :
1. Only trade in highly liquid stock indexes
2. Get a broker that provides you with real-time info & execution & is cheap
Correct?

What advice are you planning on supplying next? (a brief content before an indepth post would be appreciated)

What is your background?

Using non-Irish brokers/stocks such as Nasdaq will result in tax problems potentially.
How do you propose handling these?

I think they're all pretty fair questions and warrant answering before providing much more info.

Thanks.

Ixus

Hi Ixus,

Very good questions, and you are correct to question anything you read on any website, I know that I do.

I know about all of the forums you mentioned, and more like elitetrader, dailyfx, etc, etc, etc.

Here is what I am doing, and remember, one must evaluate what I have written before one can decide on the merits of the information contained. This will require some work. I am not here to give tips to anyone, and I would never take a tip from anyone, it is the one sure way to lose money.

I am here to share some of my trading experiences with interested individuals, which now is 8 years as I started in Sep 1999. My background is irrelevant, what I write aboyt daytrading is very relevant to making money in the markets, as I have several years of experience, good and bad, behind me.

A major misconception about trading is that you need to have a good education. This is pure rubbish. Actually, I will go as far as saying, that a person with only limited education, will make a far better daytrader than a highly qualified academic, and the underlying reasons for this are many, but are better kept for a daytrading related Psychology thread.

I am not interested in arguing, or tit for tat silly remarks, just plain and simple discussion on the aspects of daytrading.

Tax, and other such issues, are personal issues, and as such I have no intention on discussing same in detail. As of now, if you make money from trading, you must declare it as CGT, unless you plan to include it in your personal income for the relevant tax year. Where you make the money is irrelevant.

Personally, I'm more interested in purchasing options on at this moment in time. Given the present volatility in the market, the opportunities for profit are quite high, and in purchasing, you are only left open to loss of the premium. Much more potential than stocks/futures. Wouldn't you agree?

No, far from it actually !

I do not want to bring Options into this thread, for many reasons, but if you want to start one I will contribute.

Selling Options is where the profits are in option trading, but you must have plenty cash and know what you are doing. The reason for this is simple, and that is, over 80% of traded options expire worthless !

Please start a new thread if you want to continue a discussion on Options, but as of now, the free time I have will be dedicated to this thread, as I am interested in sharing some of my daytrading experiences with interested individuals.

As you start to get interested in daytrading, you will do some book reading, some web searching, and visiting other trading related forums to see if what you are doing is correct.

But, always remember, that the majority of traders lose money, so it is logical to conclude, that if you follow the majority, you will also lose money !

One of the things that you will hear a lot about, is, an "Edge".

What does having an edge really mean ?

Well, in plain and simple, bog standard Paddy the Irishman language, an edge will mean different things to different people, but it can only really mean one thing, and that is:

When you place a trade in the market, the odds of the trade moving in your favour are greater than the odds of it moving against you.

You can argue this till the cows come home, but if you accept this as the real true meaning of an edge, then you will save yourself an awful lot of time and money, believe me, I know !

The above statement opens up a whole bunch of questions in relation to trading, and now you must start to ask yourself what do I need to do, to get The EDGE ?

It may be more beneficial if members were to post their view as to what daytrading involves.

Instead of me telling you all what I can, and can't do, why don't you say what you think is the way to do it. Then, when I answer your post with a question, you will have to think why you thought the way you did, and when you see the problems explained, and believe me, they are many, you will remember it a lot easier.

Hi Article 43,

I'm enjoying reading what you've posted so far.

Alas I'm a cynic and am compelled to ask your motives. They may indeed be genuine and I mean no offence if that's the case. But you seem to be doing well from this niche, why would you wish to divvy the portions from the golden goose by educating the masses? Surely your time would be better spent grafting at the markets than teaching a 101 class here?

That being said, the 101 class is most welcome :)

Very good comments telecaster, and I can see that you are a genuine person.

Trading can be a very lonely business, and even more so in Ireland as very few do it, and those that do dabble, like the majority of TICN members, do not have a clue about real daytrading, and what it involves.

One of the biggest obstacles that faces anyone who daytrades, is keeping control of your emotions. One of the best way to control your emotions is to feel good about yourslef. The best way to feel good about yourself, is to share experiences, good and bad, with like minded people.

Also, on another sidenote, but this is not why I am doing it, it is well known that those who have made it big, have made most of what they did from sharing with other people, in one way or another. I could mention the Bible, but I prefer to leave religion out of it alltogether, as I don't care if someone is an atheist or a bishop, all that matters to me is that they are truthful and genuine.

I have no motive other than the continual pursuit of excellence with my trading activities. If sharing with like minded people helps me achive this, then this is what I will do, if it does not, then I will stop and do something else that will. I will not, however, entertain time wasters and would be traders who think they know what they are talking about. I have a good deal of experience behind me, and as the saying goes:

Fools learn from their own experiences, wise people learn from the experiences of others.

It is everyones own decision as to whether they want to be a fool, or a wise person !

As I am not fulltime trading at the moment, I can share some of my experiences with like minded people. This might change next year, but as of now I see muslef continuing with my current trading activities, which is trading the ES & YM Futures, US Stocks and Index Options.

I can't be more honest than that !

I appreciate your reply Article 43. I'll be reading the thread and will contribute when I've got something worth saying.

Do you use bookmakers and betting exchanges as part of your trading armoury?

I started day trading recently because of the volatility in the markets and i see it as something which complements my position trading where I hold
positions for weeks.

I actually trade daily contracts of US stocks on the IG index spread betting
platform. (no tax or account charges)
The only problem is I dont have volume information but i have found that it does not matter in the way i trade.

I use a number of techniques to find the stocks:
1. Scan for pre-market gappers
2. Scan for stocks near support/resistance lines
3. Other misc less important scans
4. or just trade the "popular" stocks (VMW,DRYS,AAPL,RIMM,etc.)

On these stocks i use a combination of S/R lines, chart patterns and 5 period
EMA to enter the trade, both long and short.

As I said, I'm only doing it recently but it's going well so far and i enjoy it.
Only problem is i am in full-time employment so sometimes its hard to do in the office.

Hi PDelux, and welcome.

What one will begin to see after a while, is that no matter what someone shows you, you will always be inclined to go and do your own thing anyway. This is because of how our brain operates, and it is also the main aspect of trading that needs to be mastered, with that, I mean that just because we are doing something, does in no way mean that there are not better and more rewarding ways out there for us to learn - but as you rightly say, and do, one has to start somewhere.

Some will progress beyond the initial excitment of trading, and some will even take it to the extreme, and end up as gamblers, risking everything that they have worked so hard for over many years !

A level headed approach is required, and as I am sure that none of us want to end up as professional gamblers, then the first and most important aspect of trading is understanding what Risk control really means, and more importantly how we impliment it into our trading strategies.

Making money from trading can be very easy at times, as all we have to do, is buy it at a certin price, and sell it at a higher price (Long), or, sell it at a certain price, and then buy it back at a lower price (Short).

Now, right as I speak, the ES is at 1468, off its low of 1462.50, but it is now just gone 10:00, so we will now have a continuation of the downtrend, or a reversal to the upside. Of course, it might hang around for a while, but it normally does not stay in the same place for too long.

So, all you need to do to make money, is Buy or Sell it.

Which one would you do now, and why ?

I appreciate your reply Article 43. I'll be reading the thread and will contribute when I've got something worth saying.

Do you use bookmakers and betting exchanges as part of your trading armoury?

WE all have something worthwile saying telecaster, we just need to say what we really think, and not expect criticsm or insults, but we must accept facts when presented to us, no matter what our opinion is. The majority of internet boards are rife with idiots who do nothing but waste their own time, and more importantly, other peoples time. Such individuals are not welcome here as I have no intention of wasting my time with them.

As for spreadbetters, no, I have no interest in that for the type of trading that I do. This, however, does not mean that it doesn't suit other people !

Well, it could be one thing that you need to know about daytrading above everything else.

Recently, some of our very own property tycoons, had decided to make another few cool million in the stock market. After all, Bertie came on the telly and told the nation that all the experts got it wrong in relation to the property market, and prices are still going up !

So, our millionaire property tycoons decided to use leverage, by trading CFD's - or Contract For Difference notes - after all, Bertie was also kind enough to remove the 1% stamp duty that would apply if normal shares were bought on the Irish stock exchange.

Next, we had the sub prime fiasco released by the powers that be in the US.

SLAM - our property tycoons got caught bigtime, many of them having to sell off some of their big property portfolios to cover their huge LEVERAGED stock market losses.

They could have all avoided this, had they taken adequate RISK control measures with their realised profits from the property market. But as usual, they are a greedy bunch, and in the end, they got exactly what they deserved, after all, they have been ripping off young couples for years, and making it imposible for many young families to get on the property ladder. What goes around, comes around !

Now, in simple terms, if you lose all of your money quickly, then how are you ever going to learn how to daytrade ?

The best way to not lose your money quickly, is to first practice, until you are happy that you can at least enter and exit the market quickly, as and when required, and can at least have some winning trades, as well as losing trades. The amount you can lose should always be known before a trade is placed, the amount you can win, will always be determined by the market, not by what you think it might be !

RISK control is the first, and most important step for daytrading, or any trading for that matter. To ignore it, is to lose, before you even start to win.

Can I just throw this nugget of info inot the ring here!!, recently a professional stocktrader and a monkey were given a sum of money to invest in the stock market (not necessarily daytrading as such but illustrates a point for me), they both picked their stocks from the same lists of leading companies, ftse100 etc, simply put....the monkey won!!!!!:rolleyes:

Anything to do with stocks and markets that is not driven by massive amounts of money and expertise oooozing from every orifice is only a half arsed effort to make a few bob quickly and is not too far removed from gambling!! i.m.o.!:p

Can I just throw this nugget of info inot the ring here!!, recently a professional stocktrader and a monkey were given a sum of money to invest in the stock market (not necessarily daytrading as such but illustrates a point for me), they both picked their stocks from the same lists of leading companies, ftse100 etc, simply put....the monkey won!!!!!:rolleyes

It was probably over the course of a week. Over a longer time period, randomly choosing your shares (unless you choose a very large number of them) will lose to rational, fundamental-based investing 99 times out of 100.

if i recall, it was over a 12 month period whereby they were asked to choose those shares that will most likely rise in the next 12 months and make them a few bob however I accept your point and again would argue that trading from your front room is wasteful and foolish and not to be advised, a fully professional team of traders with the very latest technology and systems available to them find it hard to do so surely doing it from you're dell laptop with a cup of coffee at the kitchen table is crackers!!!

Good posts guys, but no matter who picked the trades, one of them had to win, and in this instance, it happend to be the monkey !

If you ask me, there is not much difference between them anyway !

What were the odds of either one of them winning ?

Hint: As soon as you enter the market, the price can go anyway, but it is how far the price can go, where you need to focus, not just the direction that you think it can go !

It was probably over the course of a week. Over a longer time period, randomly choosing your shares (unless you choose a very large number of them) will lose to rational, fundamental-based investing 99 times out of 100.

Not true. There have been numerous such competitions (monkey v fund manager, etc). It was Prof. Burton Malkiel in A Random Walk Down Wall Street who first made the comparison ("a blindfolded monkey throwing darts at a newspapers financial pages could select a portfolio that would do just as well as one carefully selected by experts.")

I'm not a Malkielite and disagree with many of his conclusions. Nevertheless, he has been proven right on this point. Fund managers, analysts, brokers etc like to pretend they know more than they do. The vast, vast majority of them underperform the market averages (as do the vast majority of private investors and traders). Always have, always will. Take their "rational, fundamental-based" prognostications with a pinch of salt.

Remember, the most liquid markets will have the best traders assigned from the big institutions, so to take money from these sharks, you need to be very good and have the correct setups for trading

Article43 I assume you are talking about OTC derivatives here.How can someone sitting at home possibly hope to compete with the S & T departments of investment banks in London and New York, not to mention the hedge funds. Surely the key to stock market success is about getting valuable information before others do, and then being able to carry out quickly the right trades to make. Sure banks with their teams of equity researchers and quants have a clear advantage over the sit at home investor in this regard? I am not refuting your opinion, I just would like to hear your prespective on the issue.

A major misconception about trading is that you need to have a good education. This is pure rubbish. Actually, I will go as far as saying, that a person with only limited education, will make a far better daytrader than a highly qualified academic, and the underlying reasons for this are many, but are better kept for a daytrading related Psychology thread.

Tell this to any of the major banks,HF's etc. It's got so competitive you wont get near a FO trader position without top academic qualifications from the best universities.

A Random Walk

I understand this point; you mis-interpreted mine.

Rational investing means inter alia diversifying risk. A monkey, or the many people suggesting throwing all their money into NRK a few ago, will not perform as well as a well-diversified portfolio over the long-run or in repeated occurrences.

The "throwing of darts" idea is a bit of a red herring as it suggests doing it blindly but is actually diversifying by default once you hand a monkey enough darts.

Article43 I assume you are talking about OTC derivatives here.How can someone sitting at home possibly hope to compete with the S & T departments of investment banks in London and New York, not to mention the hedge funds. Surely the key to stock market success is about getting valuable information before others do, and then being able to carry out quickly the right trades to make. Sure banks with their teams of equity researchers and quants have a clear advantage over the sit at home investor in this regard? I am not refuting your opinion, I just would like to hear your prespective on the issue.

Tell this to any of the major banks,HF's etc. It's got so competitive you wont get near a FO trader position without top academic qualifications from the best universities.

Why not DJDC ?

All you need to be able to do is buy / sell at one price, and then sell / buy at another price when the market has moved in your favour. It is that simple, and no matter what the big players have, or do, it is there for all to see, in plain black and white !

The days of the SOES traders are long gone, where only those with access to powerfull computers and specialised order entry platforms were able to beat the big boys at their own game.

Now, with SMART order entry, if you fire in a 1000 share lot order at market, the brokers software will automatically search all the ECN's and Exchanges for the best prices and fill you accoordingly !

The key to stock market success is really understanding what Risk control means, and then developing a strategy that puts the odds in your favour when you place trades for the developed strategy. It has nothing to do with picking the right stock at all.

Just look at the pension funds. They have lost back all the gains they made this year, and more even !

Now, can you honestly say that the people placing trades for these funds know about Risk control, for the correct answer is No, for by the mere fact of them giving back profits clearly shows that they don't. Also, they are not allowed to sell short, as it is seen as being too risky - now if that is not a big joke then I don't know what is ?

Ask anyone who has to take out their pension this month what they are now going to get, and all becuse selling short is too risky !

They are nothing but a bunch of muppets, or puppets, as daytrading has nothing to do with stock picking, analyst ratings, p/e ratios, or any of that crap. They say the Economics is a sciene, but they are all wrong. You can not apply science to emotions, and daytrading is emotions personified.

Now, you can all argue until the cows come home, or you can all accept this fundamental truth about the markets, Weigh up my comments, look at the hard facts about pension funds and hedge funds, and in the end, you will see that they are nothing more than another big commercial excercise to get people to part with thier hard earned money - remember, those that run these big businesses get paid a lot of money, no matter what happens to the money that Mr Gullible has given them to control.

As for the commentators, Jim Power, Eddie Hobs, George Lee, and the myriad of other puppets, well, all I will say is that if you listen to them then you would want to have your head examined.

Take control yourself, and forget about what others say. Do some real research, then simulate and test, start small and grow it slowly. Rome was not built in a day, as we all know, so do not expect to make a lot of money from daytrading in a very short space of time, it is very hard, and the reality of daytrading is that it is 95% psychological and 5% mechanical - get that balance wrong from the start and you might as well give your hard earned money to the pension fund cartels.

One mans opinion is another mans downfall !

Question, Question, Question !

And if the answers are not understood, then there can be only 2 things wrong:

1. You dont have enough information about the subject matter to make an educated decision ?
2. The person / people who are giving you the information are talking out their backside !

Most people have both of these problems when it comes to daytrading, or investing for that matter !

The ability to quickly identify these 2 issues, is the difference between a fool, and someone who is wise, and remember,

Fools learn from their own experiences, wise people learn from the experiences of others !

But, the ability to quickly filter out the rubbish is a matter of training your brain to do so, and this anyone can do, so in theory, we all have the ability to be a genius, but in reality, the majority will remain as fools !

Hope this helps somewhat ?

I am not professing to be any kind of expert here but all markets deal in the same constant - time, they all perform over time and over any period of time a market goes up and becomes profitable for you, it's just a matter of how long you are willing to wait and what patterns you see over time that can make you a lot of money, recently markets/stocks have dipped and speculators bought them up by the bucketful to sell them when they bounced back, as they have, i.e. AIB,BOI etc., it's not rocket science but the maths geeeeeks have made a fortune making it rocket science which brings me back to my original point!! - a monkey can do it but to do it well and make real money you need loads and loads of money, expertise and TIME, doing this at home is dangerous!!

Incorrect mox54.

This is what the textbooks teach you, but it should now be obvious, that when 1+ years of gains can be wiped out in a matter of weeks, then there is something fundamentally wrong !

Socrates had a famous phrase that went something like:

"The only thing that I really know, is that I know nothing at all"

Now, if Socrtaes was right, which I believe he was, then why should we think that what is written in the textbooks is right, for, according to Socrtaes, we all know nothing about anything, and would you listen to someone who knows nothing about what they speak, and even better, give them your hard earned money to control, with no sound Risk control applied, and let them take a % commission no matter what happens to the money, even if it loses 50% in value !

Again, the only way is to make an educated decision based on the facts, but, not too many will do that, and the reason is simple, and that is, it requires some very hard work to come up with the facts, and the majority of people, curl up and die, when it comes to hard work !

Before I go, and just to get back on track, this thread is about daytrading, so lets not fall into the big common mistake of going off topic !

As a side note, as it is daytrading related, ask the 3 wise men to explain to you how to read market momentum with TOS screen, or how to read short term market liquidity with Level II screen ?

I bet you they will think you are talking about a PC screen cleaner product !

I agree with a lot of what's been said.
The stock market in the long term will always go up. So if a monkey picks any stocks the chances are they will eventually go up.

I was looking at the fund manager competition in the Irish Times recently and
found it funny that when they started losing money some of them turned to
the popular momo stocks to get quick returns.
That was an extreme example because its a short competition but fund managers these days are under pressure to get better returns and many are seeking faster ways to make money including going to emerging markets. A couple of months ago more than 50% of the top 10 stocks where fund manager money was going were Chinese stocks according to MSN, even though there is obviously a bubble there.
The point is that the days of the old value investor are nearing an end.
Even look at the new change where these managers can now sell short. Doesnt mean they will but they have more options now.

So in the short term traders can make money no matter what stocks they trade it is just that with spreads etc. you have to give yourself an advantage by trading the more liquid "popular" stocks or breakout stocks to get bigger
returns. As I said in a previous post you can read the market to find changes
in momentum and trade in that direction. That's just what day traders do IMO.

Hi PDelux,

Your comments are welcome, but I must again stress that we are starting to go off topic. Maybe I should try and expalin it a little better.

When we talk about daytrading, we have not the slightest bit of interest in investing, a bull market, a bear market, pension fund managers, hedge funds, investment clubs like TICN, or any other investment related topics.

The reasons for this are very simple and logical.

When we daytrade we :

N1. Never take any heed of what the muppets say.

N2. Never take any heed of news reports, except for the times of release for the major US reports and individual stock earnings reports.

N3. Never hold a position overnight.

N4. Never risk more than 0.1% (for beginners, rising to a max of 1% for very experienced daytraders) of our trading capital on any single trade.

N5. Never let a winning trade turn into a losing trade.

A1. Always do the required work prior to the US market opening.

A2. Always check our data feed is working correctly before we start.

A3. Always have a back up system ready to close an open position should we experience any problems with data feed or power supply.

A4. Always review our trading at the end of each day to ensure that we have done what we need to do, not what we would like to do.

A5. Always make sure that we are aware of any errors from the last days trading results.

A6. Always try and correct the previous errors so that they do not show up again in todays trading results.

Your comment in relation to "in the short term traders can make money no matter what stocks they trade" is not correct.

The reality is that very few traders can make money and hold on to it, so, even if some do make money in the short term, which will be a very low %, the odds are they will give it back, so, in effect, thay have not made any money at all, in fact, you will find that most of them lose money in the short term, and lose even more money in the long term !

Why is this so ?

Simple, they do not know what they are doing, for if they did, they would be able to make money and hold on to it !

I'm sorry to say, this still sounds like a very easy way of loosing money and playing games with stockmarkets!, I appreciate that if the research is done before 2.30 and you pick the right stocks that you can make a few bob but you also need to put in a lot of yo-yo's to make the gain, the markets are very unpredictable and a good set of results might not mean a good opening share price!.

I'd leave this to the experts and grown up people and leave the games to the kids!!:o

You are 100% correct mox54 !

It is a very, very, very easy way of losing money, and the majority actually do, that is one of the main reasons for this discussion, and that is, to talk about how not to lose all of your money daytrading, for before one can win, one must first learn how to lose, and accept that losses are an integral part of all trading strategies !

A set of results have nothing to do with it !

Again, and I do not blame you one bit in the least, but in order to try and understand what daytrading is all about, you need to dramatically re-think about all what you know to date in relation to the markets.

This is exactly why I said in an earlier post, that those with a basic education make better daytraders than those with a very impressive academic background, and I have mentioned the reasons why previously.

A daytrader should have a sound trading strategy, that is tried and tested and has proven that it puts the odds in the traders favour.

Remember, there is a very thin line between daytrading and gambling, and the thin thread that makes all the difference is called Risk control.

I don't think I have yet mentioned that this is easy, quite the opposite actually, but everyones knows it is possible, as all you have to do is buy / sell, and then sell / buy when the price moves in your favour.

Now, the opportunity factor is also a key thing, and the ability to recognise opportunity only comes from experience.

Combine risk control with opportunity, and you now have the required Edge, that will allow you to play along with the big boys, instead of playing against them, as they will always win, no matter what.

BTW, who are the experts you speak of, for we all know who the grown ups and the kids are !

And again, I must stress, and will continue to stress, that once you select the most liquid stocks to trade, and there is a process for this, you then never have to worry about "picking the right stock".

Picking the right stock, in the sense that you imply, as in associating the right stock with news, fundamentals, or all the other rubbish, is not the way to daytrade, and again, this thread is not about investing, we will leave that to the expert pension fund managers and hedge fund gurus, the ones who let Mr & Mrs Gullibles' account be cut in half in a matter of weeks, some experts they are, huh !

is risk control is a form of statistical probability that will give you some kind of a predicted result given certain factors, e.g. inflation, growth, employment indices etc etc and if so does it give day traders the right(in their eyes) to call themselves proper traders and not glorified gamblers with a bit of fancy maths and software thrown in to confuse the humble punter with a few bob to spend!, apologies if I sound sceptical but I am!.

Welcome

Interesting angle, but disagree with the philosophy lessons.

Fools learn from their own experiences, wise people learn from the experiences of others.

Wise people learn from everybody.

keep the thread

$30,000 is a tidy sum, tucked away in an interest earning account I can get 6% or there abouts and gain nearly 2 grand for doing nothing but sitting on my derrier, safe as houses and easy tooo, what return can I get from daytrading when markets only move a miniscule amount each day and individual stocks motion forward at a snails pace, I simply cant see a return on my $30,000 that would entice me to even try it!!!, sorry

You are corrcet mox54, and you should do with your money what suits you best.

But this thread is not about putting money in a savings account, and I am sure that there are plenty of threads out there that will cater for that.

This thread is about daytrading, and those that want to learn something about it. What people decide to do with their hard earned money is entirely up to themselves, but everyone should at least look at all the possibilites out there before making a decision, and their decision should be based on factual information, not on sales talk and hype !

With that, I will ask those that want too, to post what % they would risk on an syatem with an 80% win rate, that gives an average of 5 trades per week. A simple question !

And do not ever be afraid to post, for one will never learn anything of value if one does not ask questions. It is a pity so many of our so called "leading universities" do not entice studenst to ask more questions, instead of portraying themselves as an elite group of individuals, with whom, the studenst are privelaged to have as their teachers !

BTW, as I am not the best typist, or speller, and I do not have the time to read over and correct, or run a spellcheck, you will all have to put up with my mistakes from now on - sorry, but that is how it is, as I am not interested in improving my english, just my daytrading results !

$30,000 is a tidy sum, tucked away in an interest earning account I can get 6% or there abouts and gain nearly 2 grand for doing nothing but sitting on my derrier, safe as houses and easy tooo, what return can I get from daytrading when markets only move a miniscule amount each day and individual stocks motion forward at a snails pace, I simply cant see a return on my $30,000 that would entice me to even try it!!!, sorry

My opinion, article43, we should ignore all this scepticism, as you said, scepticism is good but absolute, refusing to believe fact scepticism can't be argued against effectively. Mox54, if you refuse to believe that in a market where prices change can't be made profitable by someone with a brain, years of experience and intelligence, then theres no point continuing to argue with article43. He started this forum to talk about daytrading, and IMO shouldn't be spending his time justifying the fact that money can be made.

My 2 cents:

Daytrading can be profitable, and i would agree with all the points article has said, with the exception that i have found some german stocks suitable to daytrading (e.on, deutsche postbank, deutsche boerse) but again, that depends on the outlay and cost of contract or trade, as i use spreadbetting accounts, my concern would be the spread rather than option cost. German spreads seem to have high spreads but im shopping around. My personal strategy which i am paper trading at the moment (i know paper trading is like gambling with no money, i.e., rubbish.) is to buy sell medium to high volatile stocks on the reversal of the 5 and 20 period moving averages, using, mostly, a basic half hour chart.

As for the monkey analogy, it proves most of article43's points, that investing is easy if all you seek are beta returns. seeking alpha is the aim of daytrading. For a quick outline of why article43 thinks the incumbents are muppets, go to rte.ie/business, read the breakfast notes from goodbody and see how many stocks the recommend selling compared to buying.

Yes portomar,

It is like comparing apples and oranges, mainstream to niche, and finally, would you rather pan for gold, or sell the shovels to the mile long crowd outside the store !

Any market can be daytraded, and the setups that will be required will be different, as not all markets operate in the same manner.

To daytrade Nasdaq stocks effectively, you need access to Time & Sales and Level II (called Level 2) screens. To daytrade NYSE stocks, you need access to the same screens, but as the NYSE is controlled by what is called a Specialist, as opposed to many Market Makers on the Nasdaq, the Level II screen needs to be looked at, and traded a little bit differently.

For the purpose og learning, I am only going to concentrate on the Nasdaq and NYSE markets, and we will alos look at the S&P 500 mini ES Futures, as the S&P cash, the 500 S&P stocks, is the one that all the big instutions watch mostly, the DOW is not the one to watch for market sentiment, although it has its advantages when you are daytrading the NYSE stocks, and we will cover this later.

But, we are all jumping the gun here, for we must first address the concrete foundation that is required to be inn place for daytrading, for without that, that walls will eventually give way, and it is only a matter of time begore the whole house falls in !

This is the hard and real fact about daytrading - ignore it at your own peril !

Can we plase get some answers in relation to the % risk per trade on the $30K account, with the 80% win rate strat that gives an average of 5 tardes per week, or 1 per day ???

When we have covered the Risk element of trading, the next important thing is the daytrading setup, as we have already identified the markets that we are going to look at.

To keep it interesting for you all, as I know that very few of you are concerned with risk control as of now, but it SHOULD be your top priority as I have mentioned, here is a typical daytrading layout that is one of the worst that I have ever seen !

http://www.boogster.com/stocks/tradingdesktop1.gif

Aha, I should have known, just look at the main site which is hosting the above daytrading screenshot !

http://www.boogster.com/main.asp

all the above points are well made, this is a thread for daytrading and I am sceptical but open minded enough to say I can also be persuaded otherwise, if the 80% is corretc and can be shown to be then why oh why oh why isn't the every man and his dog beating a path to your door! however with that said I would go with an inital percentage of 10%:confused:, there I have decided to spend $3,000 of fictional money to help you prove a point to me!!

Fair comments mox54.

As for the 80%, that figure just happens to appeal to the majority, and maybe the reason for that is because it is very much related to the bottom level of the top tier in exam results, as in achieving an A, after all, we all are thought that in order to really succed at anything, the more A's we get, the better we will do in life !!!

While this is factual for a small minority, the facts say that it is not the best approach for the majority !

But, I digress, so back on track quickly, as psychology is best kept for another thread.

You have decided to risk 10% of your trading capital on each trade, for a strategy that has an 80% win rate, and gives you an average of 5 trades per week, or 1 per day.

How long would you expect the $30K to last you ?

This is not a trick question.

Maybe a year, or 3 years, or 5 years, or 3 months, or 14 months, or whatever ?

Just give an honest answer, and if you think it will last you for the rest of your life, then just say so.

I have opted, have I not!, to expose $3000 to daytrading,1 trade per day or five per week really depends on what the markets tell me but with an 80% strike rate I expect $2400.00 to make me some kind of return in the immediate term so I expect as the returns begin to mount from daytrading and the 80% success rate is proven beyond all doubt that the initial $30,000 will become a huge nestegg from which I can begin to set about world domination similar to that of Tesco!!!:(

Well mox54,

You will be happy to know that you are not alone in your way of thinking, for what you have described is exactly the way that the majority of would be traders think.

What would you say if I said that your money might only last you 2 weeks ?

And what is more, I can prove it to you very easily.

If I was starting off daytrading with $30K, I would make sure that the money was going to last me at least 4 years.

Now, which one offers you the best opportunity to learn to how to do it correctly, 2 weeks of trading, or 4 years of trading ?

Even the muppets will answer this one correctly !

I may be a muppett but I tend to steer clear of get rich slowly schemes, the more you try to explain this to me the more I want to avoid it!, seriously for a moment here, if $30k is chicken feed and lasts weeks then you're basically saying that you need to invest a huge amount of money into this to make a decent return and be ready to loose a considerable sum before you are motoring!, as they say!....if you don't mind I'll keep out of it as it certainly isn't for me, best of luck to all the daytraders and I hope the indeces keep on the right side of ye!!:D

yea by my reckoning, bout 10 days to two weeks. not even counting fees.

oh almost forgot, sites i regularly use

uglychart.com
traderfeed.blogspot.com - a must
trademike.net
cnbc.com
bloomberg.com

Article43, the other problem you might have with your $30k is that with the dollar sliding against the euro, it will eat into your profits. Did you think of that?

With all due respect this thread is a bit boring.
I think this thread would be more interesting if you shared with us your day trading strategies that you find work. Explain how you trade these and why.
Explain other strategies that you used in the past but didnt work for you.

Also give examples of your trades from today, explaining whats going on.
The best way to learn is by example.
thanks.

i aint finding it boring. you can only learn from example if you start off with the raw matierials to understand some of the concepts discussed, which article43 cant assume given that trading is such a labrynthine area. hes trying to start an all encompassing daytrad discussion site, it would fall on its back if he started off with examples of how much cash he made last thursday etc.

Ok, we have established that most new trader's understanding of risk control is, shall we say, limited, but this is normal as the sales merchants hype everything up so that they can sell something.

Here are the facts:

80% probability of winning means 80 out of 100 trades are winners, and 20 are losers. This is, even for the very best traders out there, next to an impossible figure to achieve. But, this 80% win rate is not required, and it will become apparent as to why as we move on.

Lets look at mox54's trading, with 10% risk per trade and see what might happen to him.

Account = $30,000
Risk per Trade = 10%
$ Value Risk Per Trade = $3,000

Now, mox54 starts trading next Monday, and his first trade is a loser. He now has $27,000 left.

So, no big deal, after all, the start has an 80% win rate, so I will make it back.

What happens next is what happens to most traders, and some even risk more than 10% of their available capital per trade, like our property tycoons who leveraged thier account with CFD trading, so they might have been risking 120% od their account on 1 single trade, or even 500% !

Mox54 now hits on a bad losing streak, and his next 7 trades are losers. He has now lost a total of 8 x $3000 = $24,000.

He has $6,000 left, or 2 trades, but the system has an 80% win rate so he might still be OK.

He decides to continue, is tempted to double up on the next one, as this must be a winner, but he decides not too.

His next 2 trades are losers.

He has blown his $30,000 in 10 trades, or 2 weeks of trading.

What he forgot, is that with his 80% win rate, their is no guarantee that his next trade will be a winner. After all, we can have a 20% lose rate, and that 20%, or 20 trades out of 100, can all come togther, so, even if mox54 went off and borrowed another $30K to win back his initial $30K, there is no guarantee that he will have a winning trade before all of that $30K is gone as well !

And, as an 80% win rate is next to impossible, is it no wonder tha majority of would be traders lose all of thier money in a very short space of time.

Why, simple, because they do not have the first iota about Risk Control.

They all think, like the pension fund managers, thagt making money in the markets has got to do with picking the "right stock".

This is pure and utter rubbish, and anoyone who tells you so, is, well, talking out thier backside, and if you listen to them, you too will be like mox54, and lose allm of your money, to the traders who know how it works, and they are a good few of them out there.

You should all now understand, fully, how my $30K will last me 4 years !

i aint finding it boring. you can only learn from example if you start off with the raw matierials to understand some of the concepts discussed, which article43 cant assume given that trading is such a labrynthine area. hes trying to start an all encompassing daytrad discussion site, it would fall on its back if he started off with examples of how much cash he made last thursday etc.

Yes, excatly portomar.

This will be the only Irish Thread for serious daytraders, that I can guarantee, as very few know how the markets really work, and I know that, as I have tried it the hard way, like many, and failed, over and over, until it eventually clicked, and presto, no more big losers !

As of now I am trading Options, and I have no intention of discussing that in this thread, maybe at a future date.

I do not expect to get many serious traders in here, but if I get 2-5 that will suffice, as this game is not for those who want to put thier hard earned money with the banks, and the pittance they pay, nor is it for those who want to give their money to the pension fund managers, for those muppets are totally clueless when it comes to daytrading.

When one has learned what is required to learn, adopted the correct mental attitude, tested and simulated the strats to make sure that they work, then, and only then, can the daytraders dream become a reality, and when that reality arrives, you will never look at a bank in the same way, ever again, for how many banks will pay you 1-2% return, per day, on your trading capital.

Not too many I would think, but maybe some of the property tycoons will be able to do it for you, like St Brendan himslef !

Ok I understand what you are doing basically starting from square 1.
Well the thread is already on page 4 and i've found no useful information for myself. .. it's not the thread for me so. BUT i wish you the best with it.
Good luck!

Thanks PDelux,

And, if you want my honest opinion, do not look for someone to show you anything, be prepered to do it all yourself, for, in order to change what we have in life, we must have what are called realisations, and realisations are not easy to have, unless you have experienced intense emotional moments, and there is no better way to experience intense emotional monents, that to daytrade the stock market.

All I am doing, is sharing my experiences with others, and if what I say is factual, then anyone who dismisses it, does so as thier own choice. Applying sound risk control management is a fundamental pre-requisite for successful daytrading, and, to get my 4 years of trading from my money, I need to risk 0.1% of my capital on each trade, that is:

$30,000 x 0.1% = $30 risk per trade.

Many will laugh at this thought, but a lot of trades will be closed for a lot less that that, some for $20 loss, some for $10 loss, and some at breakeven, but never any more than $30, for that is the only way I will get my guarantee of 4 years training.

Now, I am overstating here of course, for the purpose of demonstrating, but for daytrading, the 0.1% is a must when starting off, with gradual increases as the strats are perfected, and, the ultimate target is 1% per trade, but never beyond that, no matter how good you get, for when you go over 1%, you are then shifting sides, and instead of being the owner of the casino, you have now become the gambler, and we all know who will always come up trumps in the casinos.

Article 43, the situation you describe with the $30k has a 1/9,765,625 chance of happening. It's hardly likely.

What percentage of the bank would you suggest trading with a 80% win rate.

Sorry only saw your 0.1% later

AS soon as your trade is filled in the market, the price can only do one of three things.

1. It can go up.
2. It can go down.
3. It can stay where it is.

Now, the odds of it staying where it is, are very slim, so slim that we can rule it out.

So, we are left with 1 or 2 above.

We now have a 50 /50 chance of the trade moving in either direction.

Every trade you place will have the same odds - no matter what you say or do, think or contemplate, rationalise or ponder !

This is the hard and real fact about trading - it is a toss of a coin on every trade you take.

This is where one needs to start thinking like a professional gambler, for if you give a professional gambler 50/50 odds, he will clean out the casinos, and some of them do, the same way as some daytraders are able to make 1-2% returns per day, and a very small few of them, not including yours truly btw, but maybe some day, are able to do 5%+ per day.

apologies for jumping back in here but my 'name' is being used!!, do you simply move to $1000 per trade and have 30 trades to play with, by the reasoning of the 80% rule, 10 of those trades will come good and 20 will be losers but the 10 good ones give you sufficient liquidity to make the averages move in your favour again and get closer to the 80% and not the 20%, basically you don't necessarily need to pick the right stock but use the system that gives you the 80% hit rate, is this how it works or have I completely missed the point and been talking out of my arse all this time:confused:

As I just mentioned, the odds of any trade moving in either direction, is 50 /50, so trying to pick the right stock, is nothing but a load of rubbish, that the big boys tout for obvious reasons - and that is, to such in Mr and Mrs Gullible.

Trading is gambling if you ignore risk control - full stop.

What you need to do, is, play the game of odds.

Now, just beacuse gthe odds are 50/50 on every trade, this in no way means that every second trade you do is going to up, or down, depending on what the last trade done.

You can have 100 trades in a row go up, or 100 trades in a row go down. The odds are still 50/50, but the probability of the trade making a profit is a different matter altogether - and we now have to come up with a way to put the odds of winning in oyr favour, and to do that is straight forward enough, provoiding one sticks to the strict risk control of capital.

Are you now beginning to see the value in what I say, or is it still a bit unclear?

It should now be apparent, that uncontrolled risk is gambling, and controlled risk is what allows you to operate a daytrading business, and like any business, one needs to have several products that will make them some money, otherwsie it is only a matter of time until the income dries up.

Again, to keep some readers interested, this is how not to have a chart set up.

http://img141.imageshack.us/img141/9642/esmessuz9.th.gif (http://img141.imageshack.us/my.php?image=esmessuz9.gif)

This is much easier to trade !

http://img57.imageshack.us/img57/1328/esokqo3.th.gif (http://img57.imageshack.us/my.php?image=esokqo3.gif)

the 50/50 rule is obvious but what is still not being disclosed is how do you move the statistics in your favour so that 80% of them are in your favour!, we've had the stick now lets see the carrot;)

sorry to jump back in, my 'name' is being used!!!!, move to $500 per trade and get 60 trades in, at 80% hit rate then a bundle come good and give you liquidity to soldier on and not get cut out at the outset!!!,.........still sounds a bit iffy but then I'm not totally open to the notion and my judgement is clouded!, OK. Ta.:D

I am not sure if my last post on 50 / 50 odds have answered your question, but yoiu can forget about an 80% win rate, it is only for the real pros, and they are very very few and far between.

Daytrading is a business, and what you need to do is have some good products to sell.

We have now put in the foundations for the new factory, the steel structure must now be added. No business can operate until it has all of its required facets in place.

the 50/50 rule is obvious but what is still not being disclosed is how do you move the statistics in your favour so that 80% of them are in your favour!, we've had the stick now lets see the carrot;)

You persist to look for a quick solution, even after I explaining, in black and white, why this is of no use.

You can ask any question you like, but, unless you except that risk control is the solid foundation for a daytradinmg business, then you are doing nothing but wasting our time here.

As one starts to grasp the concept of what risk control really means, everything else takes second place. After all, if you have $30K to start, then you can place all losing trades for 2 years, and still have 2 more years to master it.

Accept it and do not look to be an expert even before you start to understand the basics of daytrading, as it will never work, and all you are doing, as I mentioned, is wasting your time, and the rest of the readers.

Ig your question warrents further discussion, then I will answer it, if it is repeating what we have already covered, then I will tell you so. As of now, you are repeating yourself, over and over, and it must stop, now.

Do not take this as an insult, it is one of the hard and real facts that any person will face when trying to understand the markets. If you waste your time, it will cost you, big time, so better to get out of that habit at the very start.

You are again 100% right to be sceptical.

Question, Question, and Question again, everything you read, especially on internet forums !

Now, let me try and answer your question with a simple request:

If you had $30,000 dollars in your account (we will stick with dollars as we are talking about US markets ) and I told you that the system used to identify trades will have an 80% chance of winning, as many of the systems for sale to the public quote an 80% success rate, and on average, you will get 5 trades per week to place, or 1 per day, how much of the $30 K would you risk per trade?

Now, you must answer this honestly, and say the figure that you are most comfortable with.

What part of the above don't I understand, you are QUOTED saying the ststem used to identify trades will have an 80% chance of winning, where is the confusion!!!.

Call me stupid..and you are...but you're falling over you're own words and complexing the issue beyond belief!!!, again I'll rule myself out of any further discussion because I'm not convinced at all, seems like complex gambling with stockmarkets based on software written by maths geeks at MIT, not for me and Thanks.

AS soon as your trade is filled in the market, the price can only do one of three things.

1. It can go up.
2. It can go down.
3. It can stay where it is.

Now, the odds of it staying where it is, are very slim, so slim that we can rule it out.

So, we are left with 1 or 2 above.

We now have a 50 /50 chance of the trade moving in either direction.

Every trade you place will have the same odds - no matter what you say or do, think or contemplate, rationalise or ponder !

This is the hard and real fact about trading - it is a toss of a coin on every trade you take.

This is where one needs to start thinking like a professional gambler, for if you give a professional gambler 50/50 odds, he will clean out the casinos, and some of them do, the same way as some daytraders are able to make 1-2% returns per day, and a very small few of them, not including yours truly btw, but maybe some day, are able to do 5%+ per day.

That wasn't the situation you presented though. You asked with an 80% success rate what would you stake per trade. Someone suggested a 10% stake and you rubbished the suggestion showing them wiped out in 10 trades, but the simple fact is that in the situation you presented the odds of getting wiped out in the 10 trades is just under 1 in 10 million.

I'm not trying to suggest you'll make money staking 10% of your bank, all I'm doing is pointing out that the situation you suggest is incredibly unlikely.

You are saying that the important thing is risk control. In the example of an 80% chance that the trades go in the desired direction, one should still excerise risk control, so as at least not to loose (or minimise losses) in the worst case (however unlikely with a 80% strike rate). So, a basic risk control in the above example (of 30,000 capital) is to use only 0.1% of the capital for each trade (per day).
In reality, the odds are 50/50 for every trade, but how to profit from them is as yet unknown.
My question is what physical tools are used by day traders, i.e is a PC/laptop at home with broadband internet connection enough? Do you subscribe to certian websites to get up to the minute information? For the one trade per day example above, how many hours would this take to identify/set up?

PS: I have never traded in nor bought shares, so am no expert here, but am enjoying the thread so far.

That wasn't the situation you presented though. You asked with an 80% success rate what would you stake per trade. Someone suggested a 10% stake and you rubbished the suggestion showing them wiped out in 10 trades, but the simple fact is that in the situation you presented the odds of getting wiped out in the 10 trades is just under 1 in 10 million.

I'm not trying to suggest you'll make money staking 10% of your bank, all I'm doing is pointing out that the situation you suggest is incredibly unlikely.

GOD PEOPLE READ THE POSTS!! article 43 was saying that some stock trading systems CLAIM an 80% hit rate, article 43 outlined that this was probably a rubbish claim, BUT that even if it did achieve an 80% hit rate, that without risk management, you could still lose ALL your cash in 2 weeks. how frustrating

Ok, as I might have mentioned earlier, some will get it quicker than others, and those that can relate to what I am saying, will more than likely be those that have done some live trading, and will have made and lost some money.

I will not repeat myself 1000 times, sorry, I don't have the time.

Depending on how one approches it, one can daytrade with a single laptop screen, like I use at the moment, or one can daytrade with up to 10 PC screens, using windows multi-desktop with multi output graphics cards.

The strategy used will determine the required setups.

The time available to the trader will determine the strategy used.

As I keep saying, there is no rocket science involved in daytrading, and traders make it way over complicated.

Hence, those with a limited education, make far better daytraders than those with 40 thousand letters after their name !

Daytrading requires one to apply common sense, something which is very rare in this day and age.

GOD PEOPLE READ THE POSTS!! article 43 was saying that some stock trading systems CLAIM an 80% hit rate, article 43 outlined that this was probably a rubbish claim, BUT that even if it did achieve an 80% hit rate, that without risk management, you could still lose ALL your cash in 2 weeks. how frustrating

Relax. I'm pointing out it's a poor example to demonstrate risk control. Yes you could lose all your money in 2 weeks with a 10% stake but the chances are tiny. It's all well and good to throw out terms like 'risk control' but what exactly is your threshold. Using situations with a 1/10,000,000 chance of happeneing is hardly ideal.

I don't disagree, risk control is paramount but a poor example is still a poor example.

Relax. I'm pointing out it's a poor example to demonstrate risk control. Yes you could lose all your money in 2 weeks with a 10% stake but the chances are tiny. It's all well and good to throw out terms like 'risk control' but what exactly is your threshold. Using situations with a 1/10,000,000 chance of happeneing is hardly ideal.

I don't disagree, risk control is paramount but a poor example is still a poor example.
fair enough but i dont think its as bad example as you seem to. anyway, lets move on. ok so risk management is of paramount importance article 43, its somehing thats hard to get a handle on for me as a beginner spreadetter, because of the leveraging element. deltaindex do a good risk:reward ratio spreadsheet which i use though, quick and easy. i see your point with the charts but as i mentioned before, i use rsi and crossover of MAs for entry and exit points.

I have done a little live demo to show you how risk control allows you to learn from live trading. I bought 48 shares of KO to show you this live.

Now that you have been given a head start, way above what the vast majority of traders ever get, ignore it at your own peril. Forget about silly statistics and chance in this, and chance in that. Every trade has a 50/50 chance, it is what you do when the trade is filled , that will determine if you make money, or lose it !

I might post the chart to go with this trade, but you are all too anxious, and jumping the gun, and I would not like to see any of you making silly mistakes and throwing your money away, as, there are many traders out there who will take it off you in the blink of an eye.

http://img525.imageshack.us/img525/2474/ko7dec07cf0.th.gif (http://img525.imageshack.us/my.php?image=ko7dec07cf0.gif)

Now, what is the difference here ?

http://img511.imageshack.us/img511/6250/ko27dec07us4.th.gif (http://img511.imageshack.us/my.php?image=ko27dec07us4.gif)

And this is the most important one !

http://img519.imageshack.us/img519/5981/ko37dec07tf6.th.gif (http://img519.imageshack.us/my.php?image=ko37dec07tf6.gif)

Now, you have all lost me some money, but as I am only trading 48 shares to show you, it is irrelevant.

The main thing to note here, is the commission of only 1$, as this is crucial to learning, and the fact that you can trade and amount of shares you like, 20, 35, 48, 73, 87, but, I suggest you keep it to 50 or 100 max when starting to learn, as you will make many mistakes.

The secret to success is risk control, but that alone is of no use, for all the risk control in the world will be useless, if you dont learn how to manage a winning position - you should never have to worry about a losing position, as your risk control does that for you.

http://img518.imageshack.us/img518/7006/ko43dec07up3.th.gif (http://img518.imageshack.us/my.php?image=ko43dec07up3.gif)

KO is now at 63.66, and that is why you should never be wasting your time on public forums when you are trading, for all it will do is cost you money, like it just has done to me, live.

And, when you get better, bit by bit, you can even sell up to 200 shares each time, and it will still only cost you $1.

Try and do that with an Irish or UK stock. I expect to see with the soultion in about 2020.

As there are not too many questions, only repeated ones, I will now give you all some time to digest the information to date. I will check back at times to see what qyestions have been posted, and do not be afraid of some hard work, for any person who has made big money, never done it sitting on their backside and pondering.

This thread began in a promising manner but has rambled on a lot, tbh, without giving much concrete information.

I do a lot of day trading, here are some of my thoughts and a few facts for interested parties;

1 - Article43 suggests that you need 500k or so to do it full-time, I would say that 100k would be more than enough. Retail day traders look for very big returns over the course of a year - 100% or more (few achieve this, but it is possible).

2 - To regularly day trade US stocks, you need a minimum of $25k (US law). If you are a Pattern Day Trader, your broker can give you leverage of up to 4:1. That is, you could buy $100,000 worth of stock with a 25k account (on an intra-day basis only).

3 - This rule does not apply to futures (ie, you don't need 25k). Futures trading is extremely levaged. One Dow contract is equivalent to a bet of $65,000 or so. A futures trader with a small 5k account would be allowed hold up to 4 contracts (some brokers even allow more) at any one time - over $250k worth. Of course, this would be madness and a v. quick way of going bust.

4 - Best day trading broker for retail traders is IB, no question. They require a minimum a/c opening of $10k. A paper trading account is also provided by IB - you would be nuts to trade for real unless you have tested your abilities over a period of months (at least).

5 - IB charts are surprisingly poor but you can use QuoteTracker for free (IB datafeed, QT charts). QT provide great charts. They are the charts Article43 showed earlier.

6 - I don't agree that Level 2 quotes are necessary. Lots of games played here. Use a Time and Sales window instead (this shows actual orders that have gone through, level 2 shows the order book but big traders are continaully hiding and pulling orders from the book, deliberately misleading newbie traders in the process). A live chart is much more important again.

7 - Risk is the most important part of day trading. The example whereby a trader risking 10% per trade loses all his money in two weeks is a bit extreme but the point is that all traders go through losing streaks. You may be right 80% of the time but if you bet too much then one such losing streak could wipe you out. With stocks, most day traders risk around 0.5% per trade.

8 - There are strategies whereby you can ensure you're right 80% or even 90% of the time. However, this is irrelevant. Let's say I decide to buy the Dow. My plan is to sell after a $100 gain, my stop loss order is activated if I lose $2,000. The odds of the trade going in my favour are very strong, but so what? Eventually I will get caught out and lose heavily.

9 - Many of the best traders have a success rate of 30 or 40% but they ensure their winners are a lot bigger than their losers. However, it is not easy to accept a string of losses and to let your winners run. Psychologically, day trading is very intense and most people don't have the emotional make-up for it.

10 - Psychology is crucial but is not enough in itself. Lots of people say trading is 90% mental - it's not. If you don't have the experience, the expertise and the strategies, then it doesn't matter how clear your head is - you will lose.

11 - Most people lose anyway - Paul Tudor Jones (famous futures trader) said that 95% of day traders are "losers". Might be an exaggeration but stats do show that vast majority do lose money. Nor are they all newbies with no sense of risk control - most traders have an in-depth knowledge of day trading techniques, money management, TA, etc, and still lose. Fund managers may be "muppets" (I don't have much time for them either) but most people are better off putting their money into an index fund, topping up in times of trouble and leaving it be.

12 - Best sites - trader mike has some good info on day trading, espec. for beginners. traderjamie.blogspot.com is good. Traderfeed is vg, as someone said earlier, although it's probably not for beginners. http://www.maoxian.com/archivecat.html is great, with 95 charts showing entries, exits and rationale for trades.

I find it a bit odd that Article43 thinks that readers of this thread "have been given a head start, way above what the vast majority of traders ever get". There are a ton of trading blogs out there showing set-ups in real detail.

13 - One final comment. Some people think that when a trader says he is risking 0.5%, he is buying a tiny amount of shares. Not so. Take a trader with a $30 k account. 0.5% means he can't afford to lose more than $150 on any one trade. Now pretend that he wants to buy a stock at $79.77. He notices that there is strong technical support at $79.50, so he places his stop loss order just below (at $79.47) - 30 cents away from his entry point. He can afford to buy 500 shares - almost $40,000 worth of stock - and still not risk more than $150 on the trade.

all good points chartrader. im glad this thread was started, getting some really good info and i hope passing some little on! What markets do you trade charttrader?

Now, I intentionally did not reply to see what would happen, and all I will say is that it turned out exactly as I expected.

ChartTraders' post, has the following information contained:

1. Fact
2. Not Factual
3. Subjective

As a very good excercise, I will let you all go and find out for yourselves what is what. There is no need to repeat all that is written, as follows will suffice, and I will do the first one for you.

1. Not Factual
2. ?
3. ?

etc

i have no interest in picking other peoples posts to bits so i wont do this. in relation to the last few days, anyone dipping their toes in the market in the last few days?? ive been long oil and its paid off. not that i had some master plan surrounding the fed, im as clueless on their decisions and the effects on the market as most. think the surge in stocks helped the oil price - luckily for me.

Before one can learn anything of value, one must be prepared to do some work, challenge and question what they read, and be prepared to engage in discussions / debates.

ChartTrader was correct in what he done, but his post conatins the type of information that I mentioned.

It is up to those that are interested in learning to find out for themselves.

None of us are better than anyone else, and as we are all adults, we should be willing to accept any criticism that is thrown at us, and accept that we may be wrong when the facts are made available to us.

This is not a game, it is a serious business that requires serious consideration and a pratical approach.

This thread began in a promising manner but has rambled on a lot, tbh, without giving much concrete information.

I do a lot of day trading, here are some of my thoughts and a few facts for interested parties;

1 - Not factual

2 - Factual

3 - Factual w/ subjective

4 - Subjective

5 - IB charts are surprisingly poor but you can use QuoteTracker for free (IB datafeed, QT charts). QT provide great charts. They are the charts Article43 showed earlier.

6 - I don't agree that Level 2 quotes are necessary. Lots of games played here. Use a Time and Sales window instead (this shows actual orders that have gone through, level 2 shows the order book but big traders are continaully hiding and pulling orders from the book, deliberately misleading newbie traders in the process). A live chart is much more important again.

7 - Risk is the most important part of day trading. The example whereby a trader risking 10% per trade loses all his money in two weeks is a bit extreme but the point is that all traders go through losing streaks. You may be right 80% of the time but if you bet too much then one such losing streak could wipe you out. With stocks, most day traders risk around 0.5% per trade.

8 - There are strategies whereby you can ensure you're right 80% or even 90% of the time. However, this is irrelevant. Let's say I decide to buy the Dow. My plan is to sell after a $100 gain, my stop loss order is activated if I lose $2,000. The odds of the trade going in my favour are very strong, but so what? Eventually I will get caught out and lose heavily.

9 - Many of the best traders have a success rate of 30 or 40% but they ensure their winners are a lot bigger than their losers. However, it is not easy to accept a string of losses and to let your winners run. Psychologically, day trading is very intense and most people don't have the emotional make-up for it.

10 - Psychology is crucial but is not enough in itself. Lots of people say trading is 90% mental - it's not. If you don't have the experience, the expertise and the strategies, then it doesn't matter how clear your head is - you will lose.

11 - Most people lose anyway - Paul Tudor Jones (famous futures trader) said that 95% of day traders are "losers". Might be an exaggeration but stats do show that vast majority do lose money. Nor are they all newbies with no sense of risk control - most traders have an in-depth knowledge of day trading techniques, money management, TA, etc, and still lose. Fund managers may be "muppets" (I don't have much time for them either) but most people are better off putting their money into an index fund, topping up in times of trouble and leaving it be.

12 - Best sites - trader mike has some good info on day trading, espec. for beginners. traderjamie.blogspot.com is good. Traderfeed is vg, as someone said earlier, although it's probably not for beginners. http://www.maoxian.com/archivecat.html is great, with 95 charts showing entries, exits and rationale for trades.

I find it a bit odd that Article43 thinks that readers of this thread "have been given a head start, way above what the vast majority of traders ever get". There are a ton of trading blogs out there showing set-ups in real detail.

13 - One final comment. Some people think that when a trader says he is risking 0.5%, he is buying a tiny amount of shares. Not so. Take a trader with a $30 k account. 0.5% means he can't afford to lose more than $150 on any one trade. Now pretend that he wants to buy a stock at $79.77. He notices that there is strong technical support at $79.50, so he places his stop loss order just below (at $79.47) - 30 cents away from his entry point. He can afford to buy 500 shares - almost $40,000 worth of stock - and still not risk more than $150 on the trade.

I started but then thought what is the difference between not factual and subjective?
Something may not be fact but may be a subjective conclusion? So what is it?

Article43, this thread seemed to start out quite interesting, I am sure it piqued quite a few peoples interest.
But you've lost me in the last page or 2.

You posted charts and didn't explain what they represented or what exactly you were showing us.
Of course we could go and research it!

What is the main difference between day trading and spread betting?

You start out saying day trading is not gambling, but then state it is gambling but with risk management.

But isn't risk management a subjective thing?
For example I decided the most money I'd lose this weekend gambling on the soccer was 20euro. So I limited my exposure to 20euro.
This is still gambling in my books.

You also state that stock information isn't important, it's superfluous to the basic 50/50 principal of day trading. I understand that information may not be important to us, a simple one man day trader, because the assumption is someone else has the information ahead of us - but surely being informed of the existence of information should change our strategy.

Simple example,
Huge hurricane destroys some oil refineries and equipment. What happens the oil stocks - should we avoid? What typically happens when oil stocks rise or fall? Do correlated stocks follow a typical trend?

How do we use this information?

I agree with the poster above. this thread doesn't even seem to be about daytrading anymore. in relation to above, daytrading and spreadbetting aren't mutually exclusive. daytrading is simply trading stocks or commodities within a period of less than a day, i.e. you dont let a contract go past the end of the day. spreadbetting is a method of exposure to stock prices that doesn't involve buying stocks, but betting on the difference between stock prices at different times.

"You also state that stock information isn't important, it's superfluous to the basic 50/50 principal of day trading. I understand that information may not be important to us, a simple one man day trader, because the assumption is someone else has the information ahead of us - but surely being informed of the existence of information should change our strategy.

Simple example,
Huge hurricane destroys some oil refineries and equipment. What happens the oil stocks - should we avoid? What typically happens when oil stocks rise or fall? Do correlated stocks follow a typical trend?

How do we use this information?"

agreed, stock information is important, especially the example you mention above.

I find the things to daytrade are more volatiles stocks, and i trade them on a 30 minute chart, using a system called MACD, which stands for Moving Average Convergence Divergence. ill get a chart and post it with an explanation.

ok lets try this:

http://img90.imageshack.us/img90/8823/googlemacdpg4.th.jpg (http://img90.imageshack.us/my.php?image=googlemacdpg4.jpg)

ok, firstly, i dont trade google yet, the imr you need is 10,000 for a €1 bet on each cent movement and i dont have that cash in my spreadbetting account. i use this example because its a volatile stock and tends to be profitable on MACD charts. its not as clear as i would have thought it would turn out but ill outline what my strategy would have been: at the first convergence of the two macd lines,

buy approx. 69819

sell approx. 73033 i.e. close and reverse the bet at next divergent of the macd lines

Buy approx. 70364 i.e. close and reverse the bet at next divergent of the MACD lines.

Profit from first bet,

3214
-100 cost of bet

= 3114

profit from second bet
2669
-100 cost of bet

2569

now, obviously, that will not happen everytime, the next bet which is a buy looks to be a loss maker, but generally, the system tends to work.

i probably should have pointed out, the macd lines are the orange and pink lines, the blue bars are the spread price, i.e. the price at buy and sell level (the €100 cost of bet i mentioned.)

And, when you get better, bit by bit, you can even sell up to 200 shares each time, and it will still only cost you $1.
This thread is great stuff altogether :) Over the years I've learned that if you don't understand something in investing and it sounds like mumbo jumbo, you probably do understand it and it probably is mumbo jumbo.

Why are you quoting quantities and not trade value? What if I wanted to daytrade BRK.A

I am not ignoring you guys, just a busy time coming up to X-mas and some option trades to watch before expiry.

The point about the information is that, like newspapers, tv, radio, etc, what you are seeing / reading is just the opinion of someones else, including my posts, and until such time as you have experiences that relate to the information, then you take everything with a pinch of salt.

The only person that can give you experiences is yourself, not me or anyone else.

But, what you can do, is take the information that is presented and very easily, with a small bit of research, determine what are facts, and what are not. Facts are the starting point, and by the mere act of doing some little research for facts, you might be amazed at what you will discover.

After all, is this not how universities teach, the graduates are given some pointers in lectures, but they must go off and do the research to learn.

Trading is gambling when you ignore risk control, and it is actually worse, as in the case of the bet for 20 euro with the bookies, that is all you can lose, but when you buy, say 1000 shares, and don't use a stop, you can lose all the money you paid out if the share price drops to zero, and if you use leverage, like with CFD's, where you only need put up 20% of the value, then you can lose an awful lot more than what you have invested, and as I mentioned, many of our big property tycoons lost millions in the recent decline on the ISEQ and FTSE 100.

No matter what approach you take, scalping, swing, position, unless you control your risk, then you may have to face very big drawdowns (losing some of your capital, either on paper or actual if trade closed for a loss), and big drawdowns shatter confidence and leads to more trading mistakes.

The main advanatge of daytrading, is that no positions are held overnight, and thus, you are not exposed to any risk during this time, so at least you can sleep in peace, and sleeping in peace can be good for thinking about trading and how to best trade your setups - the opposite is true if you have a big loss to face the next day the markets open.

Small size is crucial if you want to gain some experiences in the markets - sorry - there is no other way that I know of anyway.

The market you decide to trade will be personal, depending on how much time you have, how much money, now much research you have done, and how serious you are about learning how to trade for profits, as opposed to trading for profits, as there is a world of difference in both.

ok, firstly, i dont trade google yet, the imr you need is 10,000 for a 1 bet on each cent movement and i dont have that cash in my spreadbetting account. i use this example because its a volatile stock and tends to be profitable on MACD charts. its not as clear as i would have thought it would turn out but ill outline what my strategy would have been: at the first convergence of the two macd lines,

buy approx. 69819

sell approx. 73033 i.e. close and reverse the bet at next divergent of the macd lines

Buy approx. 70364 i.e. close and reverse the bet at next divergent of the MACD lines.

Profit from first bet,

3214
-100 cost of bet

= 3114

profit from second bet
2669
-100 cost of bet

2569

now, obviously, that will not happen everytime, the next bet which is a buy looks to be a loss maker, but generally, the system tends to work.

i probably should have pointed out, the macd lines are the orange and pink lines, the blue bars are the spread price, i.e. the price at buy and sell level (the 100 cost of bet i mentioned.)

If you want my opinion, MACD and the majority of TA indicators are of little value.

If you must use indicators, then the ones you might find the best in relation to what way the stock is trending is RSI and Money Flow.

But remember, no matter what the indicators might say, the fact is, the minute your trade gets filled, the price can go against you, and stay against you for days, maybe even weeks, and no indicator in the world will get you out of a mess like that when it happens.

The only thing that will save you is your stop.

With the correct strat & setup, you can in fact, make money with the opposite to what most systems claim, and that is, an 80% win rate, but, you can make money with a 20% win rate, if you know how to use tight stops with the right stocks.

Not an easy concept to understand, but all you have to do is look at this simple maths.

You lose 80 trades @ avg of $25 = $2,000

You win 20 trades @ avg of $150 = $3,000

So, even with losing 80 trades out of 100, you know that on avg, agter the 100 trades are completed, you will make $1,000.

All is left is to improve your win/loss ratio, and with all the systems out there saying they can get in excess of 80%, then surely you will be able to get, at least, 50 / 50.

I will let you make out how much you will make from 50 /50 with the same R:R ratio as the 80 / 20.

i agree with much of what is said above, also two things wrong with my example above, its done over a two week period, so not strictly daytrading, and admittedly, i havent included A stop loss, which is also very important. again, one of the many differences between spread betting and binary bets (20 on utd. to beat liverpool, or NYSE to close higher than it opened on tuesday) is that your wins (and losses can run) the key is to close your lossers and let your winnings run, but thats easier said than done, and needs research, market specific, all its own. i like MACD, i also use RSI, there is actually an RSI on the bottom of chart above, but i only use it for points of exit when already in a position.

The requirement to use TA indicators will depend on your strategy. If you want to trade similiar to the big institutions, then RSI and simple MA's can identify potnetial long / short candidates.

If you want to scalp the open, then you need a completly different setup, which requires multiple monitors to watch the various sectors and the Tier 1 stocks, along with their other main components.

One approach requires a completely different risk control method, as the timeframes for the duration of the trade are not the same.

If you have the time to trade early in the day, you can have a major advantge over other traders, providing you have the correct setups, know your process, and stick to your tight risk control rules.

It then becomes a matter of just doing the trades as the opportunities present themselves. This is controlled trading, and IMHO is the best approach, as it has the least amount of risk with a good reward payout.

Trading the open can be very high risk if you do not have experience - hence why I stressed the importance of understanding what risk control can do for you, and what can happen, if one choses to ignore it. Learning how to trade with the minimal of loss should be the top priority, and profits should not even be considered, as when you are able to expertly control your losses, the profits will naturally follow.

It is no different to a casino, only you have the choice if you want to be a punter, or the ownwer. Which one would you pick ?

To try and explain some strats that are used for trading the open, would be like trying to show a dog how to sit at a table and eat a meal without making a mess. All would seem fine until the dog gets the smell of the fresh food on the plate, after which his natural instinct will take over and he will just lick up all around him, making a mess all over the table.

Odds are, if I explained a strat, which I could write out in a few paragraphs, then the majority who tried it would lose, and some lose more than others.

Do not be fooled by what people write, profits only come with experience, and experience only comes from participation, and I have already explained the best way to participate so that the required experiences can be had, but as I suspected, no one has realised the importance, and all that most people want is to be shown how to do it, either from a website, or from a course, or whatever, but the reality is, the only way you will really learn, is to do it yourself, as I have described, and then, you will be miles ahead of most traders out there, the majority of whom lose, maybe not this week, or this month, but, in the end, they will lose, as they are not playing the game as the casino owner, they are a punter !

I have done a few posts in other threads on this forum, as the concept of daytrading is very hard to grasp, and thus not too many will be able to relate to it.

I will contine to post here as questions are asked from those that want to learn a bit about it, but I will not tell someone how to do something, as they need to discover that themsleves by experience.

I will of course give some pointers, based on my experiences, but that is excatly all they are, pointers as to what I have done, and do, and what I do, may not suit anyone else, as we all think differently !

article43, if you llok back at my post i was asking to be pointed in the direction of the THEORY of scalping, not to be shown how to do it. you seem to be referring to me when you say that we should find the info out for ourselves. fair enough, but ive already outlined some of my trading strategies, and i do my research into those methods i use. i am not omnipotent, hence i dont know about EVERY theory of stock trading. i am asking you to impart knowledge, or at least its location, which as far as im aware, is one of the points of sites like boards. i have no doubt that i need to learn from my oen experience, but giving people a hard time about asking the theory behind or some pointers on where to get info turns people off straight away.

im sorry you feel no one gets your theories, i have agreed with most of the things you have said, what you seem to be looking for is a thread with people who you feel are on the same level of experience and knowledge as you, which would be pointless in the first place because youd have nothing to say to eachother anyway.

lastly, i cant see myself ever trading the open, as the stocks i look at tend to be volatile enough to make it border on foolish to risk the opening gaps. would have been nice to be pointed towards any info though.

Portomar, one futures strategy for trading the open is to 'fade the gap' - that is, if the Dow gaps up by, say, 50 points, to short it at the open and cover the trade when(if) the gap is closed (ie, when price returns to the previous day's close). Ditto for gaps to the downside (note that each 1 point move in 1 mini-dow contract is equal to $5). John Carter, a trader and author, has written extensively about his gap trading methodology (note that he employs a pretty wide stop - a 1.1:5 risk reward ratio. That is, he is risking $1.50 for every $1 he hopes to make - he says that the trade's extremely high success rate means that it's still worth taking). See link below for detailed Carter write-up.

http://www.cbot.com/cbot/pub/cont_detail/0,3206,1070+14719,00.html

Regarding trading stocks at the open - yes, it's a very volatile and more difficult time to trade. I tend not to trade stocks in the opening 15 minutes or so myself. The above Dow trade is a nice one though - worked nicely yesterday too.

Some people like the trading at the open though.
This guy calls his method Millk the Cows cos he has to get up early to catch the open:
http://kreslik.com/forums/viewtopic.php?t=88&highlight=milk+cows

It is based on statistics. For example stocks like BIDU, DRYS, WYNN, in over 90 of the last 100 days when the price went .10 above the open it went over .50 above the open. So these guys place a mark on the chart called Buyzone and similarly for the Sellzone, when the price is in the zone, go Long or short.
Problem i see with it is there are no stops and no targets, its a "get what you can" mentality.

thanks chartrader and p.delux, ill do my researxh and see if open trading is for me! thanks for the info.

Article43,

Just wanted to ask you a few questions regarding this thread. Apologies if they've been asked before but I didn't read through the whole thread.

1) What is your average time in a trade?
2) What trading platform(if any) do you trade on?
3) Do you rely heavily on technical analysis for your entry points?
4) Have you considered working for a trading house here in Ireland or abroad as a profession(assuming you don't already)?

Thanks

Artice43, I read your thread from start to finish in a couple of sitting - very informative Thank you!

My understanding on what you are trying to convey is, in a nutshell,

Buy early in the day
Set a stop loss (0.5%) and stick to it
Sell before the day is done - whatever the price!

Now for the questions:

What do you use to pick the stock? There must be 10's of stocks to pick from and virtually all of them has the potential of making (or loosing) you a couple of dollars for the day.

When do you sell? do you set an upper limit and sell when that is crossed.?

What amount of money is needed to start up?

How are we all getting along lately. Don't tell me you also timed the market and jumped to the short side. Remember however, the best time to buy is when the blooding is flowing in the streets.;)

How are we all getting along lately. Don't tell me you also timed the market and jumped to the short side. Remember however, the best time to buy is when the blooding is flowing in the streets.;)

did very good, had just been shut out of a short position on a stop loss 2 minutes before the rate cut. lucky me. couple of shorts couple of longs, good all round.

You need a pair of brass ones to trade lately, see-saw, baby. I myself am debating on wether to sit it out for the next week or possibly play the bounce.

what do you guys trade?

I am tipping away at the currency markets lately. Some nice swings, I see a bit of weakness for the euro. The cable also looks to be shaping up nicely.

i trade indices and stocks.more indices lately.my ambition is to trade google shares on my spread bet account.mama thats volatility.

If you want my opinion, MACD and the majority of TA indicators are of little value.

If you must use indicators, then the ones you might find the best in relation to what way the stock is trending is RSI and Money Flow.

But remember, no matter what the indicators might say, the fact is, the minute your trade gets filled, the price can go against you, and stay against you for days, maybe even weeks, and no indicator in the world will get you out of a mess like that when it happens.

The only thing that will save you is your stop.

Have read this entire thread but honestly have to take some serious issue
with some of the stuff you have posted Article43.
Im an equitys analyst and so actually know what im talking about.
I also do a fair bit of spreadbetting (or gambling on daytrading as you say)
What i would like to know is how you can say that TA indicators are of little use?
Thats mindblowing
You havent spoken of resistance levels, spikes etc.
You also say that news reports have little relevance...this is complete and
utter maddness. Negative or positive news definitely affects stock prices in
the short term. A profit warning or news of a possible merger will hugely
effect the stock price at the opening of trading
The more of your posts i read the more i think you dont really understand
the topic yourself tbh.
You fail to mention sector rotations, cyclicals, defensives, downtrends or
uptrends and ignore TA yet you claim to be able to daytrade?
Do you even play gaps in the market?

Thats like a soccer player saying he is able to play at the top level but
doesnt use his feet!

Have read this entire thread but honestly have to take some serious issue
with some of the stuff you have posted Article43.
Im an equitys analyst and so actually know what im talking about.
I also do a fair bit of spreadbetting (or gambling on daytrading as you say)
What i would like to know is how you can say that TA indicators are of little use?
Thats mindblowing
You havent spoken of resistance levels, spikes etc.
You also say that news reports have little relevance...this is complete and
utter maddness. Negative or positive news definitely affects stock prices in
the short term. A profit warning or news of a possible merger will hugely
effect the stock price at the opening of trading
The more of your posts i read the more i think you dont really understand
the topic yourself tbh.
You fail to mention sector rotations, cyclicals, defensives, downtrends or
uptrends and ignore TA yet you claim to be able to daytrade?
Do you even play gaps in the market?
That's interesting.. being an equity analyst i would have thought you'd have been studying P/E ratios , earnings growth etc. to see if a company is good value rather than using TA? Or do you consider both?

equities analysts would surely cover all of the things you mentioned article, plus the technical indicators mentioned. even if you are not a technical indicator officanado, you should take them into account because others in the market do.

glad to see people in the industry follow TAs aswell as me!

Im an equitys analyst and so actually know what im talking about.
Riiight, but obviously not enough to know that the word is "equities".

Im an equitys analyst and so actually know what im talking about.
I also do a fair bit of spreadbetting (or gambling on daytrading as you say)

No offence but you mention in another thread (http://www.boards.ie/vbulletin/showthread.php?t=2055223930) that you have just started work for a stockbroker and are trying out the Paddy Power spread betting simulator. That doesn't imply day trading expertise.

What i would like to know is how you can say that TA indicators are of little use?
Thats mindblowing
You havent spoken of resistance levels, spikes etc.

I would agree with the OP that most indicators are useless. Most of the time, they will get you into a move too late. For day trading, you're better off concentrating on price, volume, support/resistance levels,etc, rather than assing about with MACD and the likes. Moving averages are about the only indicator worth bothering with, imo.

You also say that news reports have little relevance...this is complete and
utter maddness. Negative or positive news definitely affects stock prices in
the short term. A profit warning or news of a possible merger will hugely
effect the stock price at the opening of trading

Yes, but you need not fret about mergers and the likes if you're day trading, it will already be reflected in the opening price. Many, many day traders concentrate solely on the chart rather than following news headlines. If something big happens and the trade goes against you, you will be stopped out - you don't really need to know why. There's too much subjectivity involved in buying/selling on a headline. Besides, ordinary day traders can't expect to compete with professional traders utilising Bloomberg terminals and the likes. Better to develop a personal, chart-based approach rather than trying to figure out likely market reaction to a news event. News matters but it's very difficult to trade it so don't try to. Secondly, exit positions in advance of major events (eg, employment report, fed meeting etc). Read the news, then forget it, as a trader once said.

You fail to mention sector rotations, cyclicals, defensives, downtrends or
uptrends and ignore TA yet you claim to be able to daytrade?

Secor rotation, cyclicals etc is irrelevant to most day traders. Most tend to focus on a number of charts and follow price closely. As for TA, the OP presumably practices his own brand of TA - he just doesn't use indicators.

I think trading off technicals alone is insane but if people don't think that support levels play a part in stocks they are also insane.

No offence but you mention in another thread (http://www.boards.ie/vbulletin/showthread.php?t=2055223930) that you have just started work for a stockbroker and are trying out the Paddy Power spread betting simulator. That doesn't imply day trading expertise.

Never for a second said i was an expert.
I just said i knew what i was talking about.

I would agree with the OP that most indicators are useless. Most of the time, they will get you into a move too late. For day trading, you're better off concentrating on price, volume, support/resistance levels,etc, rather than assing about with MACD and the likes. Moving averages are about the only indicator worth bothering with, imo.

Thats your opinion but i definitely dont agree with it.
Macd crossovers are rarely rarely wrong, they provide a good warning when to get out.
Other idicators like bollinger bands, adx indicators, cci indexes are also very useful

Yes, but you need not fret about mergers and the likes if you're day trading, it will already be reflected in the opening price. Many, many day traders concentrate solely on the chart rather than following news headlines. If something big happens and the trade goes against you, you will be stopped out - you don't really need to know why. There's too much subjectivity involved in buying/selling on a headline. Besides, ordinary day traders can't expect to compete with professional traders utilising Bloomberg terminals and the likes. Better to develop a personal, chart-based approach rather than trying to figure out likely market reaction to a news event. News matters but it's very difficult to trade it so don't try to. Secondly, exit positions in advance of major events (eg, employment report, fed meeting etc). Read the news, then forget it, as a trader once said.

Agree with you on this

Secor rotation, cyclicals etc is irrelevant to most day traders. Most tend to focus on a number of charts and follow price closely. As for TA, the OP presumably practices his own brand of TA - he just doesn't use indicators.

Well if thats the case in my opinion those daytraders are not fully utilising
the tools available to them. There is a huge amount of information
which is very relevant.

Anyway its not my job to tell someone what they should and shouldnt do.
I just gave my opinion

what do you guys trade?

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