As a young man I was a smoker, 30 yrs later at times when I catch a wiff of someones cigarette smoke I can be transported back to then and feel the strong addiction kick in. Addictions have a physical and an emotional element. The physical is not a problem for most people, they can find a way to remove the risk. The emotional on the other hand is an insidious thing, that we carry with us always, it becomes an integeral part of us, it is amazing how easily we can trick ourselves into feeding the addiction. Generally we operate in most things automatically,such as when driving a car, but we also do this in virtually every area of our life to some degree, we just don't pay attention to it otherwise we would be bogged down with detail. The key to managing this is to be found within ourselves and starts when we truly understand ourselves. Manage being the operative word, a very difficult thing to recognize and understand. So no I don't think a set of rules will fix the problem.
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First of all I would like to thank @Cloudy for directing me to Tradefeed and Dr. Brett Steenbarger. I was unaware of his blog and like his logic and writing style very much.
One thing he does not outline is a breakdown of success from the $100-$500 all in day trader to the elite trade that makes up the top 1% that are consistently successful.
Also years of experience must come into play....he talks about 10 years of day trading to work your way up to elite status....that alone is a leveler as I have the feeling that this alone salts out the losers quicker than anything.
I don't day trade myself...I find it too stressful and takes up too much of my day. But in my experience on various stock chat rooms over the last 10 years, I have found most day traders lack technical skills to evaluate their positions and as a result get into trades that are almost exhausted their run or bail out of developing trades because they have made a 1-2% gain (before commissions).
They rely on "hot tips" from newsletters and don't understand these newsletters are released....not the night before (usually) but more often an hour or so after trading has started for the day (ie. after the people behind these newsletters have placed their bets and are looking for the interest their newsletter generates to drive up the price... AND they know when to get out.)
Do I believe daytraders can be successful? Yes I do... but the skills required are huge... the biggest one is finding good opportunity and timing its entry.... and it is not by following newsletters. Don't ask me how that is done (the identifying part)...I am sure the elite 1% don't subscribe to newsletters. Thereafter one must develop TA skills to plan your entry/exit.
Fundamental skills are of little consequence.... though perhaps they can be used to identify opportunity... eg. searching for companies with a major event upcoming... perhaps FDA approval on a drug, pending merger etc
Yes thanks Cloudy...this is an interesting blog and perhaps he deals with long term trading as well and I love his quotation accents. Especially this one which I suppose is attributed to George Carlin
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Your welcome Underexposed. I learned of Dr. Steenbarger from a futures.io (formerly BMT) webinar. I don't really follow his blog or subscribe to his organization's services, but I liked his articles on research of actual trader success as there is very little stats done or proved in this wild west business of retail trading. I also enjoy following your stock trading journals, thanks. And thank you for sharing some of your stock fundamentals experience. I am still very novice at swing and short term trading of stocks.
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