6 Tips for Day Traders | This Saved My Account
if you're investing or trading in the stock market and you're finding it hard to make decisions whether to buy or sell you find yourself beating yourself up when you make the wrong decision you find the stock moving in a different direction once you got in and you feel like the stock market isn't for you but don't worry because I got you I'm going to share with you six principles that I've learned from day trading that can help fine-tune not just your trading but your mindset and help you get on the other side and become profitable so thanks for tuning in and I gotta tell you I have been falling in love with the stock market all over again which is pretty interesting because I always thought I love investing in the market and then I kind of went through a phase where I'm like I don't really love investing it's just something I do to make money um but I really do love like researching stocks making a decision to get in and get out and then just seeing my money make money the ability to just see um that we have the opportunity to just have like a printing press right here at our computer a digital printing press to print money is so powerful and so I'm falling in love with the stock market again and it's really taken me back to my first love and my first love has always been day trading uh when I first started trading the market I came out the gate as a day trader and the reason that day trading was primarily My First Love is because number one I didn't have that much money and so I just I was trying to flip my account quickly so I was like in and out of stuff uh in the same day this was way before they had pattern day trade rules and all that I was trying to flip my account but what I'm starting to realize and as members ask me questions and they're like well how did you do that why did you do that why did you make that decision how did you make that decision so quick what I'm starting to realize is a lot of the decision makings that I make in the D attachment from my emotions and feelings I'm starting to realize it actually came from being a day trader first and so I want to share with you some of the principles about six principles that I picked up from day trading that really helps me make a decision quick and helps me move in and out of stocks or options and you know for the most part become profitable so let's talk about number one the first principle is I assume that I'm going to be wrong on my first position so whenever I enter a new trade whether it's long term or short term I just assume I'm gonna be wrong on the position now when I say I assume I'm going to be wrong I just mean I assume that I'm not going to get it at the best price or I may not be buying it at the 100 best time and so what that allows me to do number one it keeps me humble because you ever notice when you're like this is the one back the trucks up buy everything that's like the one time the trade goes the opposite against you or that pattern can work a hundred times but on a hundred and one time when you back the trucks up put all your money into it that's the time that it doesn't work you feel me and so to keep myself from being cocky I just assume I'm gonna be wrong that's principle number one I go in and say I'm most likely going to be wrong but what that allows me to do is I usually buy a smaller amount on my first position into a new trade or a new investment I typically buy a smaller amount so for example I like to get a hundred contracts but if I'm going into a brand new trade I will test the water with anywhere between 10 and 25 contracts and so that 10 to 25 just allows me to be in the game allows me to get off the sidelines and allows me to test the waters and I assume I'm gonna be wrong so I want to be wrong with a small amount once I get a feel for that stock or that option or if I'm like I bought it at this price and I knew it was going to pull back I'm glad I didn't pull it back with a hundred contracts and then only pull it back with 10 to 25 because now I can go in and add to my position at the price that I really wanted now if the stock continues to go up and the option increases in value then perfect I'll also add to a winning position as well but adding to a winning position is easier to do than adding to a losing position especially if you put all your money into it the first time you made the purchase and now when it pulls back or goes against you a little bit you're like I don't have any money left to repair or buy at a lower price and so again that number one principle that I learned from day trading is I assume I'm gonna be wrong on my first position on the direction that is going or the price and so I test with a small amount which gives me a huge amount of um Clarity just being in the game but it doesn't make me panic because I didn't spend all my money and now I'm just hoping it comes back up so that I can break even if it went against me I'm like no now I got money to deploy the amount that I really wanted and so I may scale in and add another 25 and add 50 and then I'll wait till those 50 are working before I add the second 15 eventually scale up to 100. so just being humble assuming you're going to be wrong will also allow you to be kinder to yourself the moments you buy up the stock or the option goes against you you kind of can say I knew that was going to happen that's why I only bought a little bit now I kept my money on the side for the real movement or not and I feel like I know the real direction or I can get the real price that I wanted the second thing the second principle uh it's more of a mindset thing but we have a saying inside of power trades University and that is if it's not going up then it's going down and so when I get into a trade and I'm bullish and you know it just maybe goes down and keeps going down look I don't sit there and pray over it hope over it um you know come on turn around I'm like look if it ain't going up it's going down and when you're day trading you have to make that decision immediately and that's what I love about day trading you don't there is no waiting six months three months let's see what happens it's like look I bought this because it was going up if it's not going up then it's going down and so having that mindset that if it's not going up then it's going down it allows you to close a trade out that you were bullish and thought was going up and immediately decide if you need to go with put options or start playing it to the downside but just having that philosophy if it's not going up then it's going down it breaks the emotional chain of like I have to be right I have to be right I said it's going up so it better go up it's like nope it's not going up then it's going down let's close this trade out Switch and Go the other way and I walk my members through one of my trades the other day um it was such a powerful exercise to walk through because I just do it I didn't I don't really think about what I'm doing um but when they asked me a question I'm like oh well let me show you what I did and it was very interesting to see that I made a decision within minutes of this option and the stock going against me to close that out and go the other way and I immediately went proper but we'll talk about how I was able to make that quick decision so principle number three is the opposite of principle number two principle number three is if it's not going down then it's going up so if we're playing something bearish we believe the Stock's going to fall we got put options listen if it's not falling it keeps creeping higher and higher higher if it's not going down then it's going up that's the philosophy that allows us to break the chain of just hoping it continues to fall it's like look we thought interest rates was high we thought the FED speaking was going to be bad news and depending on when you're listening to this lately it's been good news even though it was bad news it's like bad news is good news it's like look hey who am I to argue with the market if it's not going down then it's going up let's go bullish at least short term and that's the principle I got from day trading it's like look we could go bullets just for the day we could go back bearish next week but at least for today stocks are moving up the Market's moving up if it's not going down it's going up then let's play that direction I have many of days where I've opened trades with put options only to turn around and buy call options before the day was over because I kept thinking we're due for a pullback we're due for a pullback but we're not getting the poor back so it's like okay if we're not going down then we're going up now principle number four this is the one that helps me make the quick decisions and I've learned this from day trading because in day trading you don't have time to think and I'm also realizing in regular trading you should kind of take the same principle but in regular trading you kind of let things go because you have time and so instead of making a decision when you're doing maybe a six month nine month a one-year investment or a trade you're like oh I got time for it to turn around oh it's not going against me I got six more months and sometimes that's okay but what that does is it it puts off it delays you making a decision when something isn't going uh in your direction then what happens is you bleed out a little bit every day until you look up six months from now and you you lost one thousand two thousand three thousand four thousand five thousand now you looked up you lost your whole ten thousand dollars the thing about day trading is it forced me to do principle number four so what is principle number four principle number four is every trade I enter especially when I'm day trading I know three things right off the bat before I ever place the trade I know what my exit strategy is meaning if the trade goes against me or should I say the chart turns against me right because I'm picking a direction and if the chart does something opposite of what I believe it should do I know exactly where I'm going to exit and take a small loss I know exactly what I'm going to exit before I even get into the trade number two I always know my repair strategy before I get into the trade so I typically trade options and so I always know what option I can sell to turn my trade or my investment into a spread and bring in some premium and lower my risk I always set my charts up to where I know the option I'm in and where I would exit the option I would sell if I need to immediately repair the trade and then number three I know my reversal strategy and my reversal strategy is back to principle two and three if it's going down if I'm buying a put option because I think the stock is going down I always have a call option on standby that I'm willing to buy if I'm wrong and it turns and goes the other way same thing happens with puts if I um or something happen with cause if I am bullish and I buy a call option I know where I'm going to get out if I'm wrong I know what other call option we're gonna sell if I need to repair the trade and then I know what put option I'm gonna buy if the stock reverses and starts to go down so I know my exit strategy from the one I bought like when I'm just gonna cut my loss well when the chart um does the opposite of the reason why I bought it and then it's like oh but what if I just want to repair meaning it's kind of going sideways it's not up it's not down but I'm losing time I might want to deploy a repair strategy and bring in some um premium or some money to reduce my risk if you don't understand what that is that's when you are doing spreads and you can sell an option against your option and lower your risk and then I always know what caller put I'm going to get in case it totally reverses so if I have calls and I think it's going up I always know what put I'm going to buy just in case it starts to reverse and go down or if I have put initially I almost know what call I'm going to get in case it reverses is going up the beautiful part about that is what happens is when it's time to make a decision you have so many things going on in your brain you're like I'm losing money that's going against me is it going to stop falling or is it going to stop going up you got all these things going in your brain to then stop and have to research what call what put you would buy or sell it's making your brain or your computer which is what your brain is it is making it overload and you got too much going on you're like I'm losing money I'm trying to pull up the option chain my internet is not fast enough I don't know which one I'm gonna buy oh what's my break even I gotta calculate that if you calculate all that ahead of time here's where I'm going to exit here's where I'm going to deploy safety or repair strategy or AKA a spread here's what I'm going to buy in case it goes the other way when you have all that locked and loaded on your trading screen you're able to make decisions in seconds you don't have to think you don't have to pray you don't have to hope you don't have to get upset you're able to make decisions in seconds and when I'm able to make those decisions in seconds that's the difference between break and even especially between losing money and breaking even and the difference between break and even and being profitable on the day especially when I'm day trading all right now number five the principle is I don't have to be right I just have to be rich simply saying I don't need to be right I don't need my ego to be fed because I bought put options it has to go down and I'm sticking with it until the stock Falls no that's being trying to be right you don't have to be right there is plenty times where I've bought put like it's gonna fall it's not falling I'm like I was wrong all right now if you're a man that's probably hard for you to admit right wives probably know like my husband never admits when he's wrong fellas we just gotta admit when we wrong and that that ego that machleness carries over into the stock market or maybe some ladies need to hear that right they afraid to admit when they wrong it's just so hard to say hey I was wrong but it's usually the fellas right y'all let me know is it usually the palace or is it usually the women but as a man sometimes it's hard to admit when you're wrong but in the stock market you got to be humble and realize it's not even about being wrong it's about being rich it's about making money and so I I always come in and admit like ah sure I was wrong because I don't have to be right I just need to move in a direction that is telling me it wants to move for the day because I don't have enough money to control the stock market so I'm just trying to hook my Caboose onto the train whichever one is going in the direction that I needed to go so if the train is in Reverse I'm not sitting there like I told it go forward it better go forward I'm gonna stand on the train tracks and get ran over until it goes forward like no I'm like okay let's unhook the Caboose that was going forward and let's hook up the Caboose on the rear so we can go and reverse with it that's equivalent to the stock market going down I'm like look it's not going up let's close out our bullish trades our cause and let's go bearish and on the flip side if the train wants to go forward I'm not standing in front of trade like no I told you to go backwards it's like look train going forward and they got way more power to run little old me over than I have power to stop it so I get out of the trains way and I hook up and say guess we going forward okay let's get a ticket in that direction and that's the same thing when the stock is moving forward or higher look we don't argue with it the market is spoken just hook your Caboose up and let's go in the direction that the market is going we don't have to be right we just have to be rich we just want to make money from it we're not headed we're not here to pass judgment on morality or anything it's just like look always is here to clock in and clock out and hopefully with more dollars than we did when we clocked in all right now number six the final principle is we're not married we're just dating all right and so day trading is the ultimate player right it's the ultimate player if you think about I think back to my days in like I don't know high school college right you think you're a player but you're really just a little punk but I was a player I was a punk player I don't know um well you think back when you were like a player you're dating women or are you a play platress would that be the equivalent of a woman a female player a platress I don't know but when you dating multiple guys it's like look we not married I'm in college you just having fun you're not trying to get locked down and tied up with one person my point is it's the mindset of the trader especially when you're day trading it's like listen I'm not married to the stock I'm also not married to this direction and I'm not married to a specific strategy so if you're in a stock and you don't like how it's moving you're not married to a divorce that bad boy you're not even married you never got to get a divorce just like hey stop calling me block delete don't call me no more all right same thing with a specific Direction I will get in the direction like I'm bullish and if it's not moving higher I'm like look we ain't married we're just dating it's going down I'm about to go run with the Bears so I just I moved my I move over and I'm not married to that direction I'm like oh we want to go down I'm gonna come over here and date somebody that's bearish right that sounds weird I'm gonna date somebody that's bearish but the point is we're not married to a direction if you start dating bulls and it's not going up you're like look peace I'm out of here I ain't feeling this relationship I'm going over it with the Bears you start dating Bears and the stock wants to go up you're like look I'm good I don't like how you treating me over here I'm gonna go hang with the bulls we're not married to a direction we're just dating it we're not married to a stock we're just dating it and then we're not married to a strategy so I normally do not day trade but in this market there's been so much volatility I've recently gotten back to day trading because I'm not feeling comfortable holding stuff for 30 60 90 days because everything's been selling off then it rallies real big and I don't know if we're getting ready for another sell-off so I just been taking it day by day week by week but I could be like well I always buy 60 90 day options or or you know I'm like nah look this market right now is calling for some good day trades I'm switching up the strategy I am going over to day Trey and once we get back in more of a consistent Market consistent Trend I'll switch back over to my longer term or medium-term swing trades but for now I've been doing a lot of day trading in and out the same day or in and out the same week and it's been working really really well for us if you've seen the one YouTube video we did um we made about a hundred I don't know 167 thousand dollars in like three weeks three to a little shy of four weeks and it's been a crazy run but it's like the Market's giving us that opportunity so it's like let's tap in and let's collect the money remember we don't have to be right we just want to be rich and we don't have to be married to a specific stock we don't have to be married to a specific Direction and we definitely don't have to be married to a specific strategy if a strategy you're doing is not working it may be time to divorce that bad boy or remember that you were never married in the first place so there's no paperwork needed you can just literally go start dating another strategy just that quick all right so I hope this has been helpful for you again I'm falling in love with the stock market sometimes you forget uh how much money can be made so quickly and how much money can be made what out you know having to talk to a boss without having to sell anything without having to do anything but just lock in with you yourself and I and the computer ah sometimes that's just such a beautiful thing to be able to just print your paycheck from the computer uh no questions asked no permission needed and um man I'm just remembering how good it feels and I'm falling in love with the market all over again because the market will always give us opportunity as long as we look for it but then the market will reward those who are prepared for the opportunity who are not sitting on the sidelines who are not saying one day I'm going to take that course one day I'm going to get that information those who are getting the information are getting prepared for their opportunity and those that are in the game are getting their experience of getting me and getting out taking their first loss making quick decisions all of these things are going to pay off and you're going to be able to print your own paycheck I guarantee it and remember you never go broke taking the profit that's the other principle I learned from day trading that's the bonus principle is that when you got some profit for the day take the money close it out you can come back tomorrow and see how you feel about the market but at least the troops are home and safe and they brought back some more Navy Seals to go to war with them I'll see you guys on the next episode
2022-08-28 04:31
