A short-term trader has one objective: to catch the current trend of the market. That is it. That is all you should try to do. It sounds easy, but trust me-it is far from simple, and for two reasons. The first is that trend identification is an art and science unto itself, and more abstract art at that.
It is a blend of Picasso and Cezanne with a splash of Chagall tossed in for fun. Second, even if you correctly spot the trend change, your reactive mind may screw things up and blow it for you. This is especially true if you are long with a loss or nominal profit and suddenly get a sell signal.
Do not confuse day trading with your long-term outlook; that is about something happening in the future. Day traders don't-can't-care about the future. Your only concern is being in phase with the current short-term trend. Your mission, should you accept this assignment, is to mimic what the market is doing. If it is up, you should be long, if down, short. Trying to forecast short-term tops and bottoms is a surefire way to rapidly deplete your bankroll. You want to be with the trend; it is your only friend.
Since greed is a stronger emotion than fear, your response will most often be to "hold and hope" which means you bypass the current new trend, holding on to the long position hoping the sell will be wrong when you should have spun on a dime. Dopes hope, winners are spinners.
Website: http://www.5minutetrader.com
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