TOP 10 Day Trading Mistakes YOU NEED TO KNOW!!!

Summary

In this video, the host addresses the top 10 common mistakes made by day traders daily, based on over 500 messages received from viewers. The host emphasizes the importance of catching the first move past the 200 moving average, waiting for trendline breaks in divergence trades, and the necessity of using a stop loss. He also warns against trading with large amounts initially, using too many indicators, deviating from proven strategies, expecting quick riches, not demoing or tracking trades, jumping between strategies, and most importantly, giving up too soon. The video serves as a practical guide to avoid these pitfalls and improve trading skills.

Takeaways

• 📉 Traders often make the same mistakes repeatedly, leading to failed trades, and recognizing these can help avoid losses.
• 📈 It's crucial to enter trades early, especially after a strong initial move past the 200 moving average, rather than waiting for a retest which may not be profitable.
• 🚫 Avoid trading divergences without waiting for a trendline break; a trending market should not be fought until the trend is confirmed to have reversed.
• 🛑 Never trade without a stop loss; it's essential for risk management and can prevent significant losses.
• 💰 Starting with a small account is advisable for learning purposes rather than risking large sums of money without understanding the emotional and psychological aspects of trading.
• 📊 Limit the use of indicators to avoid confusion; a clean chart with a couple of moving averages and one oscillator can be more effective for making trading decisions.
• 🔍 Stick to a proven strategy without altering its parameters; changing the strategy's rules can lead to inconsistency and potential failure.
• 🚀 Beware of the 'get rich quick' mentality; becoming a successful trader requires time, practice, and patience.
• 📝 Track every trade meticulously, including entry and exit points, to understand the strategy's performance and improve decision-making.
• 🔄 Recognize that every strategy will have wins and losses; a strategy should not be discarded after a few unfavorable trades.
• 💪 Persistence is key in trading; giving up at the first sign of difficulty will prevent achieving long-term success and financial goals.

Q & A

What is the main reason the speaker receives over 500 messages a day?

The speaker receives over 500 messages a day because many traders are asking why their trades did not work out, often due to the same mistakes being repeated.

What percentage of day traders is mentioned as failing in the script?

The script mentions that 90% of day traders fail.

Why does the speaker emphasize the importance of not trading immediately after a price has moved past the 200 moving average?

The speaker emphasizes this because many traders miss the initial move and then enter the trade too late, leading to a higher risk of the trade going against them.

What is the second most common mistake traders make according to the script?

The second most common mistake is trying to trade divergences without waiting for a trendline to break.

Why is trading without a stop loss considered the 'worst mistake' in the script?

Trading without a stop loss is considered the worst mistake because it can lead to significant losses or even a complete account wipeout, which could have been avoided with proper risk management.

What is the advice given regarding starting with a small trading account?

The advice is to start with a small account, like $20 or $50, and only trade money that one is willing to lose, as it's a learning experience and most traders will lose money initially.

Why should traders avoid using too many indicators on their charts?

Using too many indicators can lead to confusion and redundancy, as many indicators may be telling the same thing. It's better to use a few key indicators that align with one's trading strategy.

What is the speaker's stance on modifying the strategies presented in their videos?

The speaker advises against modifying the strategies as it can lead to misapplication and failure to understand the strategy's true effectiveness.

Why is the 'get rich quick' mentality criticized in the script?

The 'get rich quick' mentality is criticized because it is unrealistic and does not account for the time and effort required to become a successful trader.

What is the importance of using a demo account and tracking trades?

Using a demo account and tracking trades helps traders understand their strategy's effectiveness, learn from their mistakes, and improve their trading skills without risking real money.

What is the main message the speaker conveys about the attitude towards learning and practicing trading?

The main message is to adopt a persistent and dedicated attitude, similar to a child learning to walk, and to avoid the quitting mentality, as it can affect all aspects of life.

Outlines

00:00

📉 Common Trading Mistakes

The speaker addresses the frequent errors made by traders, emphasizing the importance of learning from these mistakes. They highlight the need to avoid entering trades too late, especially after a strong move has already occurred, and the importance of confidence in one's trading decisions. The speaker also warns against trading divergences without waiting for a trendline break, and the critical mistake of trading without a stop loss, which can lead to significant financial loss. The summary underscores the importance of timing and risk management in trading.

05:02

💰 Starting Small and Learning the Basics

The speaker advises against starting with large sums of money in trading accounts due to the emotional and psychological challenges that come with trading real money. They suggest beginning with a small account to learn and understand the market dynamics without the pressure of significant financial risk. The speaker also criticizes the overuse of indicators, advocating for a streamlined approach using only a few key tools. They stress the importance of following a strategy consistently and not deviating from it, as well as the misconception of getting rich quick through day trading, which requires time, practice, and commitment.

10:03

🚀 Persistence and Commitment in Trading

The speaker discusses the importance of persistence in trading, comparing the learning process to a child learning to walk who does not give up. They argue against the tendency to switch strategies frequently due to short-term losses and emphasize the need to understand that every strategy will have a mix of wins and losses. The speaker also addresses the common mistake of giving up when faced with challenges, urging traders to adopt a mindset of continuous learning and improvement. They conclude by encouraging viewers to watch their extensive library of trading videos to find a strategy that resonates with them and to subscribe to the channel for more educational content.

Keywords

💡Day Trading

Day trading refers to the practice of buying and selling financial instruments within the same trading day. In the video, the speaker emphasizes the importance of avoiding common mistakes in day trading to maintain consistent profitability. For example, he mentions how over 90% of day traders fail due to repeating the same errors.

💡Stop Loss

A stop loss is an order placed with a broker to buy or sell once the stock reaches a certain price, intended to limit an investor's loss. The speaker highlights trading without a stop loss as the 'stupidest' mistake, explaining how it can prevent catastrophic losses that could wipe out an account.

💡Divergence

Divergence occurs when the price of an asset moves in the opposite direction of an indicator, such as RSI. The speaker advises traders to wait for a trend line to break before trading a divergence, as entering too early can lead to losses in a trending market.

💡Moving Average

A moving average is a commonly used indicator in technical analysis that smooths out price data by creating a constantly updated average price. The video mentions the 200 moving average as a key point where traders often make the mistake of entering trades too late.

💡Risk Management

Risk management involves identifying, assessing, and prioritizing risks followed by coordinated efforts to minimize, control, and monitor the probability or impact of unfortunate events. The speaker stresses the importance of proper risk management, such as using stop losses and not over-leveraging accounts, to avoid significant financial losses.

💡Indicators

Indicators are tools used by traders to help interpret market data and predict future price movements. The speaker criticizes the overuse of indicators, suggesting that traders should simplify their charts to avoid confusion and improve decision-making.

💡Demo Account

A demo account is a simulated trading account used to practice trading without risking real money. The speaker recommends starting with a demo account to learn and test strategies, and to journal every trade to understand what works and what doesn’t.

💡Trend Line

A trend line is a straight line that connects two or more price points and then extends into the future to act as a line of support or resistance. In the video, the speaker explains the importance of waiting for a trend line break before entering a divergence trade to confirm a trend reversal.

💡Scalping

Scalping is a trading strategy that involves making numerous small trades to capitalize on minor price changes. The speaker addresses viewers’ questions about applying scalping strategies to different time frames or assets, emphasizing the importance of following the original strategy rules.

💡Psychology of Trading

The psychology of trading involves understanding and managing the emotional and psychological challenges of trading. The speaker discusses how new traders often underestimate the emotional aspects of trading with real money and how this can lead to poor decision-making and losses.

Highlights

Traders often make the same mistakes leading to unsuccessful trades, emphasizing the need for understanding common errors.

90% of day traders fail due to repeating the same mistakes, highlighting the importance of learning from these errors.

The importance of entering a trade early, specifically when the price first moves past the 200 moving average for higher chances of success.

Avoiding the mistake of entering a trade late, after a significant price movement, which often leads to losses.

The second mistake of trading divergences without waiting for a trendline break, which is crucial for successful trades.

Trading without a stop loss is identified as a critical error that can lead to significant losses.

Starting with a small account to learn trading without risking too much capital is recommended for beginners.

The overuse of indicators can lead to confusion and should be avoided for a cleaner and more effective trading strategy.

Adhering strictly to a trading strategy without modifying it unnecessarily is crucial for consistency and success.

The misconception of getting rich quick through day trading is debunked, emphasizing the need for time, practice, and commitment.

The necessity of using a demo account for practice and tracking trades to understand and improve trading strategies.

Understanding that every trading strategy will have wins and losses, and sticking to a strategy is more beneficial than constantly changing.

The importance of perseverance and not giving up when faced with challenges in trading or other areas of life.

Encouragement to watch and learn from various trading strategy videos to find the one that resonates with the individual.

A call to action for viewers to subscribe to the channel for more educational content on trading.

Transcripts

I am not exaggerating when I tell you that I get over.

500 messages a day from people telling me, hey, why didn't this trade

work out?

Why didn't this trade work out?

And it's constantly the same exact mistakes over and over, and over,

and over again.

And absolutely, I need to make this video.

This is the top 10 mistakes that happened every single day that I see

Traders making that you need to stop.

You need to watch this video, 55 *.

Welcome back to the channel, everybody.

My name is already and this is the moving average for sure.

We discussed everything day trading to keep you profitable on a

consistent basis over 90% of day Traders fail.

Right? If 90% of day Traders are failing and they're all making the exact

same mistakes.

And I have access to their mistakes because they send them to me via

DM.

I'm going to share that with you guys, because that's very important

to know, it's super important to know how to trade.

But it's also equally important to know how not to trade.

And these are the top 10 mistakes.

Let's just jump right into it.

Okay, so I'm going to use the same currency pair for every single one

of these mistakes.

Every single one of these mistakes happen on anything.

You could be trading Bitcoin or Tesla.

I don't care, same mistakes, across-the-board.

This is Australian dollar to u.s.

Dollar and people see the price move down past the 200 moving average.

It's got great.

Momentum.

It's moving.

It's moving.

It's moving.

It comes up to retest it goes down.

Again. It comes up to retest and they're like, okay, now I'm going to get

into the trade.

So they're their position looks like like this.

Okay, and I'm like, what are you doing?

You you missed the entire move, like you missed the entire move and

then it went into this consolidation range and then it start, it's

going to go up like why why would you wait?

And I know exactly why people do it.

It's because they're not confident in their trade and they watch the

price go down.

If they watch their entire trade blow right, past them and then they

saw the rejection and they're like, oh, yeah, it's it's going to

happen and then they wait even more to the point where they've waited

6 hours to get into this trending market.

And it goes against them.

This happens every single time.

This is why I say, you only need to focus on the first move past, the

200 that is your highest likelihood of getting this.

Chunk of trade catching 10 tips in this range is a way easier than

trying to catch 20 Pips at this range, please for the love of God, if

the move looks like this and you've been in a downtrend for a really

long time, don't trade it.

You've already missed the move.

Sorry, Charlie.

You got to wait for the next one.

The second most common mistake is people trying to trade these

divergences and not waiting for a trendline to break.

Listen, when a price is trending down, right?

And you're creating lower low, is constantly constantly lower lows

constantly lower lows.

And on the RSI, you're making higher lows.

This is a trending market and you're trying to fight a trending

Market.

You need to wait for the trend line of the trending Market to break

before you get into a Divergence trade what that looks like.

Is this, we have a trendline, we have lower lows, we have higher lows.

The RSI, the trend line broke retested and when I wait for the price

to break this damn, yellow line and retest it the next and literally

the worst mistake that every single traitor has made in their life.

And that you are probably still making is trading without a stop loss.

It is literally the stupidest thing that you can do.

And imma show you exactly why right here Market was in an uptrend.

You see these big engulfing candles down in your like, hell.

Yeah, this thing broke the trend line.

I'm going to Target this low point right here because, you know, why

not?

And I'm not going to put a stop loss in so that's what my trade looks

like. Enter trade and I'm going to go grab a coffee and then I'm going to

watch this thing.

Play out and you come back, a few minutes later and your account is

either completely at zero and blown or you're in such a deficit that

it hurts your guts, your insides, or like rotting and

Crying and your emotional because you didn't trade with a stop loss.

If you would have had a proper stop loss on here, you know, you would

have lost 1% as opposed to 100%.

This is the difference between a good traitor and a bad traitor.

Now, mistake number for like everybody, pretty much goes through this,

you see the potential of trading Forex, and you like me, and if I

start with a $20 account, I'm not going to really make any money.

So it's not worth my time.

That's where you're wrong.

That's where you're learning.

So what people tend to do is take $1,000 or $5,000 from their savings

account in there, like with a $5,000 accounts.

I can trade one whole lot sized.

Make a ton of money on every single trade and that's the first time

that you've gotten into trading real money and you don't understand

the emotional aspect and the psychology that comes behind trading with

real money and it's gone.

It's gone.

You literally just

Broadway.

So, what I need you guys to do is stop, depositing so much money and

actually start off with that $20 account, or that $50 account.

Only trade money, that you are absolutely willing to lose because the

first time that you put money into the markets, I 100% guarantee you.

You're going to lose that money, but you're going to learn so much

from that one experience the next mistake.

I see people making is way way, way too many indicators, your charts.

Usually look like this.

I know that there are millions of indicators on tradingview, but that

does not mean that you need to use them.

All you need to pick a strategy and pick one or two indicators that

really really like gives you the confluences that you need to enter

your trade having your chart look like this makes me not only want to

puke but is going to make you confused because a lot of these

oscillators our momentum indicators, so their litter

We just telling you the same thing.

You have eight indicators on the bottom half of the chart that show

you the exact same thing.

Stop doing it.

Clean up your charts.

Use a couple of moving averages and one oscillator.

That's all you need.

Now the number 6 mistake on this list, irritates me.

More than you guys will ever understand.

I read every single comment.

I read every single DM and there are hundreds of them.

And I get this one, the most, or so.

I will put out a video on how to scalp on the 5, minute time frame

using this strategy, and I have specific rules for that strategy and

then people are like, so I watched your video and I saw that you were

using the smooth moving averages, but can I use the exponential moving

averages and do the exact same thing will shoot, dang partner.

I see that you were marking up them support and resistance levels on

the 1 hour time frame.

I'm wondering if I could do it on the one minute, dude.

I see that you were going for like

122 risk-to-reward ratio.

I'm wondering if I could do like a 1 to 2:50.

So I know that you said that this was only going to work on Forex

pairs, but can I use it for Crypt?

If somebody gave you a step-by-step recipe on how to bake a cake,

literally just follow the recipe and you'll have a good cake.

Don't put tuna fish inside of it.

And that's my rant for the day.

The number seven mistake that I see people making is the fact that

they think that they're going to get rich quick, because they saw some

video on the internet on how to day trade and it is the wrong thing to

do. You want to change your career paths from what you're doing?

Now to being a full-time day trader, but you wanted to happen

overnight.

It is literally impossible.

No basketball player was just like, I'm great at basketball.

Would be in the NBA tomorrow.

You don't work that way.

This is a really, really difficult thing to learn.

It is a really, really difficult thing to do and you need to commit to

it. You need to be consistent and you need to give it the time that it be

Flyers.

Because if you have the audacity to think that $5,000 a month, income

is just something that you should be granted because you're now a day

trader, you're wrong.

This takes a lot of time and a lot of practice.

I've spent thousands upon thousands upon thousands of hours learning

this. And I've also lost a ton of money along the way, making these exact

same mistakes.

We've all done it.

These are the growing pains that you go through when learning the

number 8 mistake.

I see people making is not demoing for any length of time and not

tracking your trays, people get into a demo account or a live account,

and they just start trading randomly.

Like I lost I lost, I lost.

I want, I lost but you have no idea why you want, why you lost your,

not tracking your trade.

So how are you supposed to know if your strategy is going to be good?

Long-term if you have no statistics to back it up.

You need to get on a demo account.

You need to pick a strategy.

I need to journal every single trade, why you entered, what time you

entered everything about it and then do a recap.

If it hit take profit or if it has stopped lost.

And why do that for a month on a demo account?

Every single day?

Then look at the statistics and I promise you, you will go from being

a d-minus Trader to like a B+ Trader.

It is the biggest thing that you can do to increase your skill level,

the number 9 mistake.

I see people making is so common and I completely get it.

You try a strategy and then you win, right?

And then the next time you try it, you lose and you're like note.

This strategy is garbage.

I'm going on to the next best thing or you try a strategy and you lose

on the first one and you're like, no this thing's a pile of junk, but

that one may have been the best strategy on planet Earth.

You have to understand that every

Single strategy has a win ratio and a loss ratio like win to loss.

Sometimes you lose 20% of your trades.

Sometimes you lose, 40% of your trades.

If you are above a 50% win rate on a strategy and you have proper risk

management, you are a profitable trade or you have to understand that

every single strategy has losses.

No strategy, works.

100% of the time.

It does not exist.

Stop jumping from strategy to strategy and the last mistake on the

list is people giving up.

I get DM's every single day from people saying, maybe day trading is

just not for me.

I can't figure this out.

What you need to do is Think Like A Child, a child that is learning

how to walk will not give up.

It won't just sit there and say, maybe I'll just never walk.

I can't figure this out.

You need to get into a mindset, that anything is possible with enough

practice. This and dedication don't think that you can just quit because if you

have the quitting mentality, you're going to have the quitting

mentality for everything that you do in life, whether it is a weight

loss goal, whether it is a relationship, all the problems in your

life. If you just quit trying to fix them or quit working on yourself,

that's a really deep topic.

But I promise you you're going to be massively dissatisfied with your

existence if you keep quitting.

So stick with it, work your ass off.

If you want to make good money in your life.

If you want Financial Independence, and Financial Freedom, you have to

commit to things and not commit for a week or month.

You have to commit for the rest of your life.

So basically, if you want to learn how to day trade, I have over a

hundred videos on this channel of different strategies, whether it's

scalping or swing trading or naked trading or indicator Trading.

Whatever floats your boat.

I need you to watch every single one of the videos and see which one

speaks to you because demo that strategy.

And if it doesn't work out, come back and choose another one.

My favorite one, and my suggestion to you is start with this one.

And if you guys enjoyed this video and you got some value out of it

and you like the way that I teach consider subscribing to the channel

by clicking this button right here.

Thanks so much for watching and we will see you in the next video.