Profiting from Sleep

Normally, I prefer swing trading, as day trading is just too mentally draining for my taste. You have to wake up early, follow the market minute by minute, follow your stock minute by minute, keep on top of rumors and current events. But I decided to give it a shot anyway, since I was pretty much free this summer. So for the next two weeks I woke up at 6am (9am eastern time) to analyze the news to determine whether I should hold for longer periods or take small scalps.

The results weren't encouraging from Aug 18th to Sept. 6th I made $983.15 after commissions. I definitely would've made more via a full time job. On average I would make 200-300 dollars per day, but would lose $500-$600 on bad days. Well it turns out I lost most of my money on days in which I didn't get enough sleep. When I was groggy, I couldn't react to the news (i.e. bought HGU when gold prices crashed); I would forget to set up my stop losses (usually triggered around -$150); I didn't react fast enough when my stock du jour hit pivot points (surged past resistances). 

In addition, I became burned out and depressed after the first week which further compounded my losses. At one point I had six back to back losses, and was not very happy. Making losing trades actually coerced me into taking unnecessary risk to break even. As you're all aware, not planning the trade is a recipe for disaster. 

All in all, day trading should be treated seriously like a 9-5 job. If you're not feeling 100% or you hate trading then STOP. There's no point in continuing as you'll most likely lose money. I learned the hard way, not trading and relaxing for one or two days can actually be more productive than grinding at the computer day in and day out.

-The Hawk

Burnout: 

http://stress.about.com/od/burnout/a/stressn_burnout.htm

Day Trading and Burnout:

http://davidsadams.articlesbase.com/day-trading-articles/5-tips-for-fighting-day-trading-burnout-1629809.html