I saw a streamer who almost got liquidated and took $20,000 loss within hours from day trading. In case anybody forgot, I want to remind everyone about the most basic rules in day trading.
- You must have knowledge about how to read charts and indicators. Charts tell stories and you must know how to read them. You won't get the hang of it by trying it a few times. There are rules to this shit.
- Once you have studied important basics on how to read charts, you can start practicing by trading with real money.
- You must remember that you can always get liquidated. You must expect to lose most or all of your money invested. If this rule bothers you, you are playing with too much money. Play what you are HAPPILY willing to lose. Being happy no matter what is best mindset in the game.
- Always discipline yourself to a STRICT STOP LOSS if position goes bad and about to turn worse. Most people get liquidated after they deny numerous chances to break even or take a very small loss. Denying a small loss creates opportunity for bigger loss and eventually liquidation. Play within a certain financial boundary where you are happy to lose.
- Keep stop loss under 2%. As a day trader, most of my scalping positions are aiming for 0.5%~1.5% profit. Therefore, anything above 2% stop loss is unacceptable. I don't even do 1% stop loss.
- Ladder in your positions NO MATTER WHAT. I cannot stress enough how important this rule is.
If you are trying to day trade without laddering, you are on a suicide mission. You will get stopped out 7 out of 10 and you will lose all your money in the long run. - Winning a position is all about management. If you can manage a position by adding and shaving, you can practically turn any position into green.
- Calculate fees correctly. Fees add up.. especially for day traders where we go in and out of positions multiple times a day. Playing with maker fees will save you big bucks in the long run.
- Keep calm. If you are panicking for any reason, you are doing something wrong. Go study more, or decrease the size of your positions. Keeping calm and management is KEY in day trading.
- Most importantly, don't do this for money. Only be willing to LOSE your money. If your focus goes to profits, you will never succeed. Trading is game. It's a fucking war zone. Be a player, not a gambler.
I wanted to share these because I saw myself when I saw the streamer. When I first started trading, I ignored all the rules and did things on my own. I thought I could thug it out. My ass. Got liquidated a few times and realized I was blinded by profit and greed. I went back to studying and brought myself back to humble in order to learn basics all over. I think it's been a few months since I got myself back on track. I looked back at my trading records and I realized....
I was up 50% in PROFIT from 40-50 positions I played in ONE WEEK. Funny thing is, I didn't lose a single trade. In fact, it was too easy. Each position took anywhere from 2min~2hrs depending on time frame and volatility. Most positions are finished within 30 min. I played on average 5~10 positions daily whenever I saw a good chance to go in.
Point is, if you are losing more than one or two trades a day, you are probably doing something wrong.
.....This blog sounds too personal I'm gonna take it down tomorrow.
... annd next day I come back to realize you can only edit posts and never delete them..
sounds great!look forward to more explanation.
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