I was a day trader for a certain number of years, and I was able to make money for a couple of months.
It seems like day trading can be a fulltime job, and looks like everything is working the way it was supposed to be.
My technical analysis was correct, and the 50, 100, and 200 day averages are great ways to predict the market.
I begin to brag with my friends and ex-coworkers about how free I was, working at home and making money with the snap of my finger.
Then, the great equalizing happens...
I begin to lose trades after trades, and debts starts to accumulate...
I thought it was because I lack skills or just because I don't have enough knowledge about the market.
Maybe I do lack the skills to become a day trader, but I think I was wrong in many levels as well...
One of the biggest thing I was wrong about, is the "unit" error...
When we first become a trader, we wanted to make money... fast!
We want to invest $10k, and we expect to get 10k back within the next hour, days, or weeks...
That's when I was wrong...
If you look at the total statistics, the tiny percentage of people who make money investing are long term investors.
Some of them expect returns in units of months, but most of them expect returns in years.
The companies that are well-off financially are going to get the stock price they deserve, even though in the short term their stock price are low because of industry headwind.
In a few months or years, this company will catch the eyes of investors again, and it's stock price will be equivalent to it's value.
That's when long-term investors sell and make a profit...
Oh, but we can't! we are humble people, and we need money to pay rent and our car payment... Yesterday!
That is exactly why you are not rich, and why the rich gets richer...
Money go to those who don't need them... immediately!
Banks borrow money to the wealthy... people with lots of collateral to reduce risk... not to people who needs money... like yesterday...
If you work for the bank, would you lend money to people like you?
The stock market works the same way...
I can guarantee 1 thing about the stock market, and that is the stock market on average gain about 10% each year... and if you are able to hold out for long enough... you will become the statistic...
The stock market redistributes wealth in "unit" of years, not days, hours, seconds...
However, most of us expect returns from our investment in days...
Tell me then, how can you profit from the stock market?
You're most likely wiped out by the swings of the emotions of the crowd, way before you can actually start to profit.
In essence... everyone have the ability to make money in the stock market...
If you understand that the market is here to double, triple, quadruple your money in "Years" not hours, then you can harness the power of the growth of the nation...
On the other hand, if you are here attempting to make money in days, the power of the entire statistical world is working "against" you...
The choice is yours to make...
For your reference only...