I am an active day trader. I have noted down some observations based on my trading activities. I want to share them over this platform with the hope that some may find it useful who is just beginning his trading journey.
Every Morning when you come to trade, No one knows what Nifty would do. Hence it is
better to stick to your Trade Plan which will eventually work for you. Stop prediction &
don’t make any biases about Market moves. Trade mechanically having a well backtested
Everyday is totally new day for Trading. If you keep memories of past performance you
will always hesitate to perform at present & always miss good opportunities. Get rid of
‘analysis paralysis’ & ‘I should’ve entered here’ syndrome.
It’s real fact that you cannot trade all day. The more you stay in front of the terminal,
more you tend to get invited to random trades as you lose concentration. So you need to
choose among morning session (9.15 am to 11.15 am), Mid afternoon session (11.15 am
to 1.15 am) & Post afternoon session (1.15 pm to 3.20 pm). where you are the most
comfortable with trading.
If you deal with more than one trade plan & with more than one sessions (time zones)
then it will result being cought in overtrading which in turn results in bad health, lot of
stress & capital destruction.
Trading is not 9 to 5 kind of job where you need to seat & work all day long. In trading
sometimes your trade is over within a minute while sometimes it can take hours to
complete your trade. So no need to feel weird when your work is over much early.
Trading is not easy if you don’t have proper trade plan. It may look easy to come at any
time in front of terminal & take gut based (discretionary) trades & make huge money, it’s
never like this. Better stick to your mechanical trade plan & make less but real money.
Many of the times it happens that price touches your stoploss & then resumes its
journey towards your target. You should get used to such situations. Never to forget
stoploss is very important thing in trading. There is no shame taking small losses as per
your trade plan.
In Stock Market only few things are under your control :-
i) Order execution as per Trade Plan,
ii) Money Management,
iii) Risk control (setting of stoploss).
You see your set up, you take a trade, you think price may come down from your
purchase price level, you set a stoploss as per your loss appetite.
Now happens few things:
i) Price goes to your target level without coming down.
ii) Price retraces comes near to your stoploss level, but then reverses & goes to your
iii) Price retraces, comes near to your stoploss level, hits it then reverses & goes to your
iv) Price hits your stoploss level & keeps coming down.