New to trading, looking for some advice!

[JasonCo]

Hey t2w! I'm a 25 year old that just recently got interested in day trading, its extremely fascinating to me. So much that I feel like this is what I was meant to do for the rest of my life. Currently right now I am in school and working a full time 7am - 3:30pm job. The trade school I am in in is geared towards turning me into a professional Electrician, and the Electrical company I work for is helping out a lot as well in my Journey to become a Journeyman. I also have 2 years of College at University of Oklahoma, so going back to get my Electrical Engineering degree has also been in the back of my mind. But... None of that really matters to me anymore, of course it is still very important because it is the source of my income, and I have put a lot of time into it... But, I know for a fact that day trading is what I was destined to do.

I know if I become extremely disciplined, study a lot, and join a great group of traders that I could possibly turn this into a full time job. Right now I have no real big responsibilities other than keeping myself alive.. I don't have any kids or girlfriend, I just pay my monthly rent along with all the bills and food and that is all, so I am willing to take a risk. I am just unsure how to transition over to becoming a day trader!!

I realize that I am going to need a sufficient amount of money to start with, so my New Year resolution is to stop eating out every day (Which adds up to over $700 a month).. Yesterday I went out and bought a Costo membership and my plan is to spend no more than $150 - $200 on food. Also I am adding a roommate to my house bill so I'll be saving an extra $200 on rent. I am making these big changes in my life because I need to start saving up for whenever I try and transition over.

The big question is though, how do I transition over! I work from 7AM - 3:30pm (sometimes much later) and I do this Monday through Friday. I realize I am also going to have to trade with paper money for awhile so I can get the gist of things and come up with a good overall game plan. How much money do you think I should start out with once I start trading with real money? Also, does anyone know of the steps that I'll need to take in order to set up a good paper trading account, like what software I'll need and etc...? My job starts at 7AM and goes throughout the day Money - Friday so what advice would you give me in order to even trade at all!!! I just know for a fact that this is what I want to do, I am willing to do whatever it takes now to achieve this!

I appreciate any advice you want to give or any constructive criticism you might have as well haha.. I look up to all of you day traders, you all are really inspiring to me, hope to hear from some of you!

 

[tomorton]

Hi JasonCo - as I'm not a daytrader and not in the US, I don't hink I can give you much detailed advice but would venture some generalities.

Firstly, learning daytrading is to me like learning to race at the same time as learning to drive. Bear in mind you can trade longer-term, which would allow you more thinking/learning time window on each trade, plus opportunity to do your TA and set your orders outside market hours, so your work and studies commitments would not be an issue.

When you're starting out, paper trading can be useful but its not a realistic simulator. The software / data often doesn't properly reflect the underlying market so don't put full faith in the outcome. On top of which, the game changes when you put your own real money in that you've worked for and paid tax on: i.e. the way you react to what happens in the game changes when your hard earned cash is under threat.

Finally, at first, especially with a snmall account protecting your capital is key, not driving up your profits. You have to survive long enough to learn the game so controlling losses on losing trades is essential.

But best of luck, keep at it.

PS: You seem to list a girlfriend as an overhead? Maybe you're looking at the wrong sorts of girls. ;-)

 

[JasonCo]

But best of luck, keep at it.

PS: You seem to list a girlfriend as an overhead? Maybe you're looking at the wrong sorts of girls. ;-)

hahaha, no girlfriend actually. But I know plenty of woman who would love to take my money!

Thanks for the great advice. Longer term investing would be good for learning the ins and outs of how to actually trade, maybe I'll try it out while I keep watching videos and what not, I think that'll be a good thing at first. What really excites me though is day trading, getting in and out of stocks fast, I love everything about it!

I agree what you are saying about the paper trading, its all fun and games until you start competing with people using real money, its probably entirely different ball game and mentality that I'll have while trading. So I might do it but I won't rely on my results.

And yes I need to be extremely discipline when it comes to my losses, and just accept the fact that I made a bad trade and get out fast, instead of hoping and wishing it goes back up. I've heard this from others and it seams to be VERY KEY to becoming successful. I will have to learn to be disciplined and not emotionally attached.

Thanks a bunch for your advice, and taking the time to read and help me out. Appreciate that. Hope all is well, have a great one!

 

[JasonCo]

If anyone has some advice on some of the other questions I had, I'd still love to hear them! Thanks again tomorton

 

[connorja]

I'm in a similar situation myself, however I don't work lengthy hours as that.
I'm still learning and I have practised slightly on the sims to get the jist of the different kind of candle sticks, and what they tell me about the market at that time etc. As that was one point I wasn't aware of until I began learning.

I knew as part of my degree (Economics), that the currencies would be affected by economic events around the world etc. So maybe as a suggestion Jason, depending on your knowledge, jump into the financial news headlines. Pick a topic, for example the USD is currently strong. Make sure you know what it means for a currency to be strong, how it got there, why it is staying there, what effects is it having on a) the US economy and its currency b) matching pairs, eg EUR or GBP.

When you can quickly analyse the economic effects of a news headline, you'll be able to understand the greater economical motives behind the market. Please be aware that the economical motives aren't the only driver. You also have the psychological motive of other traders etc influencing the movement.

 

[options-george]

Hi JasonCo,
great to hear that trading has got you excited!

Have you spent some time (say 20-30 hours) reading through all the sticky T2W threads? Doing that will probably help you to get a picture of what you need to be doing. You could start with this one:

http://www.trade2win.com/boards/first-steps/30625-i-m-new-trading-where-do-i-start.html

Unless you convince someone to give you a job in the trading industry, you will need to work hard and do a lot of the work on your own, and make sure that you have enough income as you go along. Trading is not different from other professions, in that it takes 3+ years to learn (just as with your engineering degree or your Electrician course), do an apprenticeship etc.

Good luck!

 

[merquise]

Hi Jason,

My first post here but not in trading Almost 3 years now since I started the long journey of leaning and trading.

Great that you're interested in day trading but I think you're confusing that term with scalping as you said , you like to get in and out of the stocks fast. The basic day trading premise is different in it that your trades last through out of the day and you close them all at the end of the day or sooner depending of the situation.

I am also day trading Forex atm, using 1 hour charts so I have enough time to analyze the market and enter/exit the position. My usual holding time is around 4-5 hours. All my positions are closed at the end of the day.

As far as the money goes for actual day trading the stocks and options, you need at least 25.000$ account. For Futures and Forex you can go low as 5.000$.

Since you're also working well the only way to day trade is for you to get some smartphone or tablet so you can monitor the market and trade, although I don't know how will that impact your job since you will need to split your attention.

There are excellent books on Technical and Fundamental analysis for you to read, so read them. Two I recommend always are Technical Analysis of Financial Markets, J.J. Murphy, and Japanese Candlestick Charting techniques, Steve Nison.

Also remember that the average time for someone to become profitable in this industry is roughly around 4-6 years, so don't expect any miracles in your first couple of years learning and trading. You need to go through several market cycles to acquire the experience.

Best of luck to you!

 

[Fugazsy]

If you have passion for trading it is a huge plus...

my advice to you?

Get a girlfriend, two is better......there is more than trading in life...

Start with small amount of money, if you trade forex you can open an account with $10, you do not need money to learn to trade, do not paper trade.

Have a plan/vision of what you like to become and work towards that.

Wish you all the best.

Fugs

 

[Pat494]

You are young and in a hurry. I understand that eagerness but take a valuable tip from an old stager. I used to spend most of every day hunched over the computer charts, neural nets etc, for years. It is only recently I have realised I had it all wrong and wasted years of life enhancing activities.

Keep your day job or get another and do your day trading after getting home again. Put your trades on last thing at night. Let the markets work for you while you sleep, work and play. Don't become like I did a short term trading obsessive. It ruins your health, curtails your other activities and makes you no more money even.

So get yourself set up with a free demo like MT4 and ONLY start trading real money when you are regularly profitable.

There are loads of defunct threads of youngsters just like you on this forum. Check them out too as well as the stickies. There's lots to learn.

 

[bootsyjam]

Check out babypips.com and their free step by step learning stuff. It will provide a great foundation for you to work from.
Also, make sure you write down your trade set ups and only take these set ups. It requires great discipline to be successful, and trading without your predefined 'edge' (i.e. set up) will not work out well in the long run.

 

[johnfox1234]

welcome to check out my vids too. https://www.youtube.com/user/TradingSkills4u

 

[tomorton]

Also, make sure you write down your trade set ups and only take these set ups.QUOTE]


This is really great advice and reminded me that when I first started trading I didn't used to do this. Maybe many new traders likewise don't do it either. Maybe they're just scanning for numerous chart patterns or "discretion trading" or just momentum trading. But if you don't know what you're looking for, you won't know whether you've found it.

These days I trade one of a possible 6 set-ups - if none of these apply, I don't look at that chart for another opportunity until after the next close. The set-ups are fairly similar so sometimes a trade or entry order could be triggered by two or even three simultaneous signals, that's fine if it is. I always log the set-up that got me into the trade plus the reason why I exited.

 

[bootsyjam]

Also, make sure you write down your trade set ups and only take these set ups.QUOTE]


This is really great advice and reminded me that when I first started trading I didn't used to do this. Maybe many new traders likewise don't do it either. Maybe they're just scanning for numerous chart patterns or "discretion trading" or just momentum trading. But if you don't know what you're looking for, you won't know whether you've found it.

These days I trade one of a possible 6 set-ups - if none of these apply, I don't look at that chart for another opportunity until after the next close. The set-ups are fairly similar so sometimes a trade or entry order could be triggered by two or even three simultaneous signals, that's fine if it is. I always log the set-up that got me into the trade plus the reason why I exited.

Good work! You know more than I did when I started that's for sure....

I can also recommend investing in some screen capture software (I use BB Flashback) so you can review your trades at the end of each day, both the good ones and the bad ones as they happened live. This is really important, it helps cement your trading ideas and what you're looking for so you can repeat it every single day.
I can also recommend reading The Trading Athlete for the mental side of things.

 

[arigoldman]

Good work! You know more than I did when I started that's for sure....

I can also recommend investing in some screen capture software (I use BB Flashback) so you can review your trades at the end of each day, both the good ones and the bad ones as they happened live. This is really important, it helps cement your trading ideas and what you're looking for so you can repeat it every single day.
I can also recommend reading The Trading Athlete for the mental side of things.

Thanks for mentioning it.

 

[tomorton]

Thanks for mentioning it.

I didn't.

 

[arigoldman]

I have learned about forex for a few months, at first I started with babypips, you know, the higher the grade you are in, the harder the knowledge is and when I reached "high school" level, it was really tough for me to remember all of those information. Then I found I can open a demo account and practice all the thing I had learned. That was my very first experience with forex trading.

Well trading is not like you can get into different levels. The moment you enter into a trade you are 1on1 with market sharks, investment banks, traders and investors.

 

[KC_OIL]

How to trade oil?

Hi everyone,

I’m a little frustrated trying to trade oil. I have tried a lot of stuff from technicals to fundamentals and still without much success. Does anyone know of a good resource where I can find the fundamentals explained in an easy to understand way and also with some technical levels?

Thanks

 

[Pat494]

Hi everyone,

I’m a little frustrated trying to trade oil. I have tried a lot of stuff from technicals to fundamentals and still without much success. Does anyone know of a good resource where I can find the fundamentals explained in an easy to understand way and also with some technical levels?

Thanks

Business news channels will over load you with fundamentals. The savvy crowd may have already factored in the news before it has happened and then go the other way ! So what should have been good news can drop a share/index/commodity price.

 

[KC_OIL]

Business news channels will over load you with fundamentals. The savvy crowd may have already factored in the news before it has happened and then go the other way ! So what should have been good news can drop a share/index/commodity price.

Thanks for the reply. How do you know when to get into a trade then?

 

[Pat494]

Thanks for the reply. How do you know when to get into a trade then?

Ah now that is the question.