4 bad habits new daytraders will do.
As a beginner, you will create bad habits and it’s going to prevent you from growing to become a professional trader. I have a few reasons here and take it as a grain of salt but these are helpful to a certain extent but should not be huge weighted factor in your trading.
1) Futures/post market
2) Stocktwits/Wall st bets
3) Googling your stock to death
4) Asking permission
#1. Futures / afterhours
Unless you’re trading futures then you should just stop looking at this. When it’s afterhours, it does you no good to keep on looking at the chart. There has been numerous times that futures would show GREEN or RED and the following day it’s literally the opposite. This also goes for afterhours because it doesn’t tell you much.
Again there are times where it will MATTER such as news related or ER etc but if you’re seeing this for no reason, leave it alone. You can’t do anything today.
WOW Tesla is up 2.33% It’s going to the MOON!!. Uhh..no it’s not. This means nothing to me. NOTHING AT ALL. It can still gap down or even gap up tomorrow. If we knew what was going to happen you’d have people stocking up right now to buy it. You can however use these numbers as another line on the chart. These numbers can be algo candles and it throws off the stock because there’s barley any volume afterhours.
Rant : What I hate the most is someone is going to be like……OMG (insert stock) it’s TANKING afterhours. Then I check and it’s down like <1%. Oh jeez I hear this all the time. I get it if you’re new but do some research ahead of time.
Again do not worry about this. There is NOTHING you can do specially if you’re in options. Just leave it alone and go to bed and sleep tight.
#2. Stocktwits / Wallst Bets and all these social media platforms with stock “gurus”.
Before I start ranting on a rampage, there ARE smart people in these places. Some are very well educated and give out really good plays. However for the most part about 80% of what is posted are just straight up trolls. There is nothing going to the moon because some dude posted re-posted an article from 2 days ago saying (insert stock) has an upgrade or what’s their face is buying it. The news already happened and people already exited the trade.
https://www.reddit.com/r/wallstreetbets/
Also stop posting about hating each other if you’re a bull or a bear because in the end your pointless argument will go nowhere. It is your money and it doesn’t matter how you spend it. Just because I like cheeseburgers over tacos doesn’t mean one is better than the other.. unless you’re drunk which I have no preference.
Before I get flamed for this post, I do like wall st bets. All I’m saying is, watch out and do your own DD when trading. There are a lot of YOLO plays that make no sense and as a beginner you may take these plays without knowing anything in stock options.
Do yourself a favor and do not visit these sites if you’re looking for legit information because it may change your trading thoughts.
#3 Googling your stock
This will only apply to people who are bag holding. I have been there and tons of people have been there too. What you’re going to do is start looking for POSITIVE articles on the internet or any internet chat room. Stop getting acting like because this is hopium.
“I hope it goes up tomorrow”
This does NOT work and there’s nothing you can do. Just because there’s a youtube video on the topic and 5 blogs post with 2324 retweets that it will go up, doesn’t mean it will go up at all. Reading while you’re in the trade will not do anything. It will make you feel better and give you more hope.
You’re better off cutting it so you’re not always thinking about it.
#4 ASKING PERMISSION
This will always annoy the other person because all they will hear from you is…
“Are you still in _______?”
Look, it’s great if you’re asking because you want to talk to them about the stock or have a conversation started. By all means that’s perfectly fine. However if you’re asking when to get out or stay in, then you’re on a different level. The person who purchased the stock option (YOU) is responsible for that trade now. This is almost the same as #3, to make yourself feel better. Don’t ask people if they are in a stock because you feel the need to know when you enter and exit the trade. The person is not doing the trade for you. If the person exit and you feel there’s still value in the stock then stay in. But if you’re getting scared or blowing up your account then sell the stock.
So come on guys, if you’re new…
These are perfectly fine to do but do not get a habit. You will never become a daytrader if you keep on thinking this way. There are a lot of resources online that can help. One of my favorites is investopedia.com
But if you need some help you’re always more than welcome to send me a tweet or message and I can point you to the best of my abilities. So happy trading everyone.
