CHAPTER 8
Day Trading Basics
The following is what I wrote when I first started day trading years ago.
I feel lost. That is the best way to describe how it feels to transition from swing trading, or one of the other phases in a trader’s life, to day trading. Nothing seems to work. All of the rules I spent years learning just do not apply in this universe.
The feeling of foundering reminds me of how I felt when I first started trading. There was so much to consider, so many methods to try. Which one should I begin with?
Day trading is the same way. Should I play the 1-minute or 5-minute scale? Gaps on the daily chart that I considered rare happen on every stock at the market open. Should I trade with them or fade them?
What about indicator settings, candlesticks, or chart patterns? How well do they work in this universe? There are so many options, I do not know where to begin.
A day trader I watched operate for a few days told me that he spent four years and tens of thousands of dollars buying almost every course offered. Remember seeing those infomercials for trading programs on late night TV? Forget red and green signals. The programs do not work, and they cost $5,000 or more. Trading schools? You cannot buy experience, and they only teach you the basics anyway.
What should I do?
I often feel lost when tackling a large project, but I have found that breaking it down into small steps and creating a plan to tackle the project helps overcome the feeling. Let us approach day trading ...
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