One of the biggest challenges for most aspiring stock traders is “the day job.” Most of us who embark upon the trading journey have aspirations of being able to trade full-time from home and enjoy the many benefits that accompany that lifestyle.
The reality, however, is that the journey between deciding to actively trade the stock market, and being able to give up the day job is very arduous. In this article, we are going to discuss a few practical tips on how active traders can balance trading and the day job.
Master the Daily & 4 Hour Charts
Unfortunately, many new traders want to learn to scalp the market. The idea of scalping the S&P 500 during the market open or market close each day is exhilarating, but the truth is that it is very difficult, even for the most advanced traders. Classic technical analysis tells us that price patterns which form on higher timeframes tend to offer more reliable signals because they are encompassing a wider set of data and less prone to the being affected by the noise of the market. Therefore, the Daily and 4 Hour Charts are a great place to start actively trading. Furthermore, these timeframes make it possible to trade and keep a day job because signals are only occurring a few times a week, depending on your technical strategy.
Higher Timeframes Help Kill A New Trader’s Biggest Enemy: Overtrading
Traders tend to love the excitement of being in the market, and this emotional satisfaction can lead to big trouble if traders begin to fire buy and sell orders like a wild cowboy. Overtrading is one of the leading causes of failure among traders. However, if a trader is trading off higher timeframes, he will most likely be much less prone to overtrading because market signals are not occurring near as frequently as they do on lower timeframes. By trading off higher timeframes, a trader can develop a technical strategy that analyzes the market and decides at what price zone entries will be made well before price reaches them. This helps keep traders from chasing price in their stock and forex account.
Less Financial Stress
Trading full-time for a living can be very stressful if your family is dependent on your trading profits in order to pay the bills. In fact, very few traders are able to perform under that type of stress on a consistent basis. This is another reason that actively trading and keeping the day job is a good idea. Trading is very risky, and a person should only put capital at risk that they can afford to risk. If you have a day job, and you are trading with capital that you can afford to lose, you will most likely experience much less stress as you trade, which is absolutely essential.
HowTo Track The Market During The Work Day
As technology and stock and forex software advance, this is getting easier and easier. First of all, if your work environment is friendly to you checking charts for a few minutes a day during your breaks and lunch hour, then there should be no problem at all. The newest advance in trading technology, however, is the smart phone. The Droid X, iPhone, and other smart phones offer applications that let you access broker charts, real-time price feeds, and a host of other accessories. Technology has come a long way and not only can you check out usda home loans but you can check the ups/downs of the market. This is a great way to stay in touch with the market throughout the day, and chances are good that your stock broker or forex account offers the ability to execute order via your phone. This convenience takes the trading experience to a new level for the active trader who is still keeping the day job.