Millionaire Tradersall those kinds of markets. At the beginning, you make too many
mistakes. I think the first goal for all traders is to learn how to
stop losing money. For me that means not trading in the middle
of the day and realizing that the very last hours of the day trade
differently than the first hour of the day. It’s a process where you
learn to stop making so many mistakes.
Q: Can you give a more detailed idea of how the first hour of the
day sets up and then the last hour of day? What are the differences
between the two and what are the unique characteristics of each
one of those particular parts of the day?
A: I think the first hour is when we see a lot of retail customers
and volume. We also have a lot of news early in the day that gives
us kneejerk reactions to play. When you get in the middle day,
where the volume drops off, there are different forces at work. I’m
not great at sensing those. Fade trades do not work nearly as well
in the middle of the day. When you get into the last part of the
day, when you have funds balancing their positions it is much more
difficult to fade the market within the last half hour, and that’s what
I’m best at. After doing this for seven years now, I know that. I
understand that about myself, and I try to be more careful of the
trade at the end of the day. I also trade much smaller sizes at the
end of the day.
Q: So your most confident trades are at the beginning of the
day?
A: Absolutely.
Q: If we were going to distill it to one simple sentence, and
obviously it’s much more complex than that, but the overarching
philosophy is this. You tend to have lots of news flow at the begin-
ning of the day. Lots of excited retail order flow, lots of what we in
the business calldumb money, which is just sort of money chasing