Yes, it is profitable. But you should have correct trading psychology to handle the emotions. There is a huge difference between day trading and any other type of trading. You have to fight in the market every day, its not going to be the same battle every day. As Sun Tzu, mentioned in his book Art of War, âSometimes we need to lose the small battles in order to win the warâ.
Some times you might end up making losses continuously but it doesnât matter unless and until you follow your trading rules. But balancing your emotions during such time is more important, with day trading it is easy to lose confidence as the market is more volatile in lower time frames, we should be able to filter the noise to avoid trading some days. It is not necessary to trade every day in markets to be profitable.
You should treat day trading just like any other profession. Let me illustrate with an example.
You would have witnessed these people who sell stuffs near traffic signals. Daily 100s and 1000s of car pass by each day, and these people try selling the product every time the signal goes Red. Some times, they are able to sell it and many times they would not be able to sell it before the signal turns green. All they have is just few minutes of time in between Red and Green signal.
Have you ever wondered how they are able to keep showing by each day in the same signal and able to sell successfully? Itâs because the odds favor them, more no of vehicles is nothing but more no of customers, instead of opening a small shop near by road and sitting there and waiting for customers, he just stands near traffic signal and turns every car into a customer.
Thatâs how you should consider Day trading as well. Just like the guy who sells near traffic signal;
- He faces lot of rejection from customers - You would see lot of losing trades.
- He have to pitch in sales every time signal turns red - You have to place trades every time when your trading system says so.
- He never losses hope even if he is not able to sell a single product for next 10 red signals because he believes he can sell the product next time - similarly, if market doesnât go in your favor, you may end up making continues losses, will face drawdown but keep faith in your trading system and believe that you would eventually make profit out of it.
Once you have the necessary trading psychology to handle day trading environment, nothing can stop you.
Everybody would be happy as long as the boat sails good, the moment a storm hits it, only thing people would think about is âHow fast we are going to sinkâ , but there are few experienced people who understands the market, knows that these storms are normal and it would eventually pass by soon and the smooth sail would resume soon. Those are the people who make it big in trading profession, others just go broke. That is the kind of mindset you should have to be a profitable trader.
Do not keep on looking for that secret strategy to make profit, instead just start with what you know, make mistakes, learn from it, adapt to market environments, learn about yourself, trade with the money you are comfortable with, manage your emotions well, thatâs it. Keep repeating the process. Eventually you will make it big, just remember that Day trading is simple but not easy.
