Well meaning friends and advisories often send out specific picks as to what to trade and when. There are inherent dangers in such programs, despite everyone’s best efforts. First, even if posted on Twitter, your mentor makes the trade, sends you the details and your must receive it. Then you act on it. Most often, (ignore the time frames on the chart) you miss the move simply because of the time delay in this process. Imagine getting the message to buy long based on the chart below. By the time you get it, the trend reverses. In good faith, you get in and quickly realize you’re now in a ‘hope and hold’ situation. The move is over.
Secondly, and I stress this endlessly, become the expert. YOU should learn how to read the technicals, make the assessments and determine the entry and exit points. As day traders, you are not merely mechanics clicking the keys on the others’ whims; YOU need to be able to read the raw data and form your own determinations. Candlesticks are raw data. So are macd’s, stochastics and all the other input items that entail a trade. By relying on others – regardless of who they are – you are putting your faith and confidence in someone else’s interpretation of what the markets are doing. Is it not the very reason you got into trading your own accounts? Did your financial guru not squander away your money already?
I teach stock options trading, from beginners to seasoned professionals seeking solid strategies to mastering the psychology of the business. Regardless of whether you enlist my services or find the knowledge elsewhere doesn’t matter; the important point is that you need to learn to master the charts yourself. Put the effort in, the time and even the financial investment to learn. Once mastered, your financial woes will be a distant memory!
Hugh Grossman, Head Trader at Day Trade SPY.
Hugh Grossman is the founder and Head Trader at DayTradeSPY and uses his vast experience to teach his methods to make consistent daily gains trading SPY options. Join Hugh in his interactive Trading Room to see how he regularly pulls in the profits!
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