Prof. Tyler yamazaki

Chapter 3
The Gold Nuggets
While there is always going to be a little luck associated with day trading,
there is still plenty you can do when it comes to improving your averages
and maximizing your profits in the long term. The following tips and
suggestions are a good place to start when it comes to building a successful
day trading career.
Finding the right trades
The first thing you need to remember is that every successful trade is
always going to be based around a measured approach. As such, the first
thing you are going to want to do is make sure you are trading the types of
stocks that not only align with your long-term goals but match up with your
temperament as well. Additionally, you will want to utilize any existing
knowledge about relevant fields that you may have to lean into a specific
type of stock. For example, if you previously worked in manufacturing,
then sticking with stocks that are based on companies who deal heavily in
manufacturing can give you an edge as you innately understand the ins and
outs of those companies which can give you a better idea as to what will
cause those stocks to move in unexpected ways.
Regardless of the types of stocks you choose to focus on, there are three key
aspects of every trade you are going to want to keep in mind before you pull
the trigger.
Timeframe: The most important thing to keep in mind is that you are always
going to want to trade in a timeframe that matches up with your state of
mind. Trading in a timeframe just because someone else says you should is
a great way to end up either nervous or impatient, neither of which is a
mindset that is going to help you make any money.
If you are just getting started in day trading then the timeframe you are
most likely to be comfortable with is the 5-minute chart. This is a nice

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middle ground for day traders as the movements it produces will not be as
fast as the 1-minute chart nor will you have to expose yourself to the added
risks of holding a specific stock overnight. You will also need to experiment
with micromanaging trades all day versus doing research during the
weekend and placing weekly trades at the start of the trading week.
Micromanaging trades tends to lead to gains in the short-term while weekly
trades are more likely to produce results in the long-term.
Methodology: When it comes to working with a methodology that works
for you, it is important to find something that plays to your own specific
strengths and weaknesses as opposed to trying out everything that “experts”
say is hot at the moment. Additionally, you are going to want to keep in
mind that every trader is going to have bad days as well as good and as long
as your trading plan is effective at least 60 percent of the time then you are
guaranteed to be successful in the long run as long as you stick to your plan.
Switching things up all of the time is only going to skew your results which
will make it more difficult for you to determine the true cause of any
failures or successes that you come across. Additionally, switching
regularly is only going to make it harder to learn the intricacies of your
chosen methodology, making you less effective when a difficult to unravel
issue arises.
Trade indicators: Additionally, you are going to want to focus on a handful
of trade indicators that work for you and master them completely before
moving on to something else. This will allow you to find the ones that work
best with your trading strategy and your overall trading style. The best place
to start is with those that work the best in the timeframes you frequent.