Day Trading: Ever Thought Of Giving Up?

By Author: David Adams
Total Articles: 41
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There's an old saying that if you haven't burned through at least one futures trading account you haven't learned how to trade yet. I want to point out that I'm not a believer in that philosophy, though there are many novice traders who have burned through at least one futures trading account, sometimes more. At some point, some traders feel the sting of defeat and take it personally and they just give up in desperation.

There are many reasons novice day traders fail, and it's usually due to lack of preparation, experience, and lacking the proper mindset. Just the same, the failure rate among new traders is a dismal statistic.

So why not just give up?

Many traders begin trading without proper preparation, and the futures markets are no place to be if you don't know what you are doing. There are a number of ways a novice trader can prepare himself or herself to be a trader. Most new traders who succeed have taken a solid training course in day trading methodology. Further, those traders have usually found an experienced mentor to guide them in their trading. Every good trader has a solid system that he or ...
... she follows without fail. There is little room for deviation once you have found a system that is successful. Consistency is the name of the game, and consistent traders are profitable traders. It takes a great deal of self-discipline to trade consistently, as enticing trades against the trend tempt even the best traders. But eventually traders learn to identify high probability trades and low probability trades. Obviously, every trader wants to execute as many high probability trades possible and avoid all low probability trades. Sounds simple, doesn't it?

So why not just give up?

Controlling your emotions throughout the trading session is one of the most difficult skills to master. In my opinion, the best reason to enroll in a sound trading program is to trade the program in a strict fashion. This is very difficult in the beginning, as many trades that would seem to make good common sense appear on your chart. But common sense is not an attribute that is particularly useful in day trading. In other trading disciplines, common sense is a great attribute to possess, but day traders typically trade using technical indicators and most markets trade technically. This is, in a sense, a chicken and egg argument. Do intraday markets trade technically because most traders are technical traders? Or vice versa? It really doesn't matter, what is important is that the new trader sticks with a time-tested system without deviation. The problem is that emotions often enter the trading equation. Emotions like greed and fear, to be specific. A new trader does not have the luxury of being greedy in his or her trading, nor does he or she have the luxury of trading in a fearful state. It's a tall order to control your emotions, yet this very skill must be mastered as completely as the trading system the new trader has learned. Temptation in the market is ever present, and controlling your emotions when a tempting trade presents itself, but your trading system says it's a bad trade, is the skill that takes a tremendous level of self-discipline.

So why not just give up?

Experience is also a helpful attribute to add to your trading arsenal. While it is a relatively controversial topic, I believe trading on a demo account is important. Some disagree with this viewpoint with good reason; some traders tend to deviate from their systems and over trade the demo accounts since it is not real money. It is my opinion that a new trader should his or her demo account exactly the way they plan to trade a live account. That is to say, that practice makes perfect; and they must practice on their demo accounts in the exact fashion they plan to trade a live account. As an aside, it is a quantum leap to go from your demo account to a live account, but that is fodder for a different article. My point is a simple one: trade demo accounts just like a live account.

In summary, there may be times when you feel like giving up. But the answer lies in a good education, a good system, experience, and the proper psychological/emotional outlook on the market. It's a tall order, but if novice traders can approach the market with these goals in mind success can be found.

I am a long time retail and institutional trader who now only trades part time, usually in the morning. I enjoy writing informational articles about my style of trading so others may benefit.



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