Lately, if you have been following Ray Barros on twitteroos on the ES, you will see how he has to be alert monitoring the markets after pit session begins, to twit his change of tactics as the market does what it wants to do.

As Dr Brett Steenbarger said on Traderfeed on Wednesday July 15 2009:“When trading, you want to be in an active, inquisitive mode, watching how we’re trading at the moment, but also the context of the moment’s trade.” As a result, even Ray who hardly day trades, has been one in order to move with the markets to keep his risk:reward ratio worthwhile to take his trades or keep his sizing small.

I take this opportunity to  help  those who day trade, and  I would like to quote from Jim Wyckoff on Mark Cook’s seven major rules for day trading:

1.  DO NOT TRADE THE LAST HOUR OF THE DAY IN THE S&P 500 FUTURES MARKET. The probabilities of a successful trade diminish in this timeframe due to the impulsive and reckless buying and selling by institutions just because they didn’t get their trading done earlier.

2.  IF YOU DON’T LIKE THE TRADE YOU’RE HOLDING, GET OUT.

3.  AFTER TWO HOURS OF TRADING, ASK YOURSELF: “DO I FEEL GOOD ABOUT MY TRADING TODAY?” Once two hours have passed, Cook says a day trader should have made at least two, or perhaps more, trades, “but enough to evaluate what you have done.” If the trader feels good about the day’s trading, continue. If not, stop trading that day.

4.  ALL CYLINDERS OF THE ENGINE MUST BE RUNNING EFFICIENTLY. “Day-trading is a job, and your paycheck is determined by your ability. You can only maximize your ability if you have all the information you need to make trading decisions. “If a piece of equipment that one uses for trading is not working, stop trading.

5.  HAVE COMPLETE FAITH IN YOUR INDICATORS. “This is a must for success,” said Cook. “Many times your indicators give you a buy or sell signal, and you don’t follow it because you don’t have the confidence the signal is right this time. Successful day traders believe in their indicators, but also are aware that nothing is 100% foolproof.”

6. TO ANYONE WHO ASPIRES TO BECOME A DAY TRADER, OBSERVE THOSE WHO ARE SUCCESSFUL. “Any information you can procure on the trading philosophies, mechanics and techniques is well worth your while.”

7.  DAY-TRADING IS A LONG-TERM COMMMENT. “I fervently believe it takes several years to become a true professional,” said Cook.

A day trader is a cross between an extrovert and an introvert, with both characteristics in balance, according to Mark Cook, a veteran trader from East Sparta, Ohio, whom I also met a few years ago at a trading convention.

Ana aka Idkit
Ag Moderator

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