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Learning How to Trade Stocks

This post is made for me to keep a journal of my stock trading journey which I am about to begin now. I don’t have any secret motive behind this post, I’m not writing it for any SEO purposes or an attempt at making any money. I’m writing it because I’ve read that it’s good to keep track of your trading routines, to document what you do. I believe documenting my trades and having a history of my performance will help me tremendously in looking back on my previous trades and learn what I did wrong or right in order to become a better trader and increase my overall profits. I could write this post offline in a word document. But no, fuck that. I’m going to write it online on this blog so I can have access to it wherever I am. And if a christmas miracle happens maybe someone reads it and even learns something from it.

My financial history

My previous experience with stocks is basically nada. I just turned 23 years old and for many years, probably since I was 17-18, I’ve been thinking about trading stocks because I know there is good money to make in the stock market. However year after year I’ve postponed it and said to myself that I will start looking at investing another day. Rarely I would casually google how to trade stocks and how to get into the stock market, but it was just sloppy reading for me without taking any action. It was a jungle of uncertainty. I didn’t know what stocks to invest in, I don’t know jack shit about the world. How could I predict what stocks would go up and down? It’s so hard and I had to think for myself so I just postponed it day after day, week after week. But then I clicked which made me extremely productive and it felt so good being productive, every hour of the day, no dissonance at all. You can read about that on the ABOUT ME page on the blog. I don’t want to go into it in this post because it will probably just confuse people.

Anyway I was productive so I just did what I had to do. Finally I got my thumb out of my ass. I started researching about what broker I should use in order to invest in long term stocks and I ended up at EVLI. I registered an account at them and went through the verification process. When that was done I transferred some money from my bank account to my EVLI account and bought a few shares of GOOGL. I also put some money in a medium-low risk fund. So that’s how my portfolio looks like right now. I did all this in the middle of March.

Now, a little bit more than one month later I have profited 1.06 % on the GOOGL stock and 1.04 % on the fund. That’s good! A lot better than having the money in my bank account and just loosing them due to inflation. However I would probably need a capital of 1 million bucks in order to earn a living investing long term in stocks.

Day Trading

I still have some money left on my bank account which I am going to use to day trade with. Day trading can be insanely profitable and I have decided to give it a shot. I’ve been reading about day trading for the past week and I know the basics. I also know that it’s expensive to day trade because many brokers are charging $5-10 per trade, and in day trading a 1-2 % gain is something you will take and be happy with. However, let’s say I have $1k to trade with and I make a good trade so I earn 2 %. It means I just profited $20 off one trade. But then the broker wants $5 when I buy the stock and $5 when I sell it. So the broker’s fees just ate 50 % of my profit… That sucks.

So thought I could start by trading cryptocurrencies instead which has way lower fees and I already have some ETH in my Kraken account. For some reason I bought 10 ETH for $100 when they were worth $10 each. Today, a few months later they’re worth $60 each so I profited $500 on that trade. I’m still holding them. A few days ago I was watching the ETH/USD chart and noticed that ETH had a pattern, just simple support and resistance. At this time ETH was worth around $450, and I had 10 of them so I had $450 to play with. I dragged two horizontal lines on the trading chart in order to mark the support and resistance. I sold at resistance and bought on support. I profited 0.6 % off that trade and it was fun, but I noticed that cryptocurrencies are fluctuating so much that it’s hard to trade them if you’re holding them long term.

They are so unpredictable because they can spike off the chart and not care about support and resistance at all, and I really want to have a position if they spike, which they do. But then again I’m a noob so I might be talking out of my ass. I feel like day trading stocks is more reliable and stable than trading cryptocurrencies. Also trading on Kraken sucks because the volume is not that high and I’ve read that they crash when there is a lot of trades going on, for example if ETH tanks a lot and a lot of people want to sell. Then Kraken freezes and no one can sell and everyone is frustrated.

So, for me who is ready to invest $1-3k in day trading stocks, I have done some research and found out that the best alternative for me is to open up an account at TradeZero because they have low fees. If I understand it correctly it would cost me about $2 per trade using them. However they’re located in Bahamas, have some minor spelling errors on their site and there is not much information about them on the internet so I am not very comfortable using them. A few people have told me that they’re good and I have never heard anything bad about them so I will hope for the best and use them as my first broker for day trading as I can’t find any better alternatives.

But before I start losing my money I am going to do some trades spread out over a few days with paper money (trading simulator). I will probably use TradeZero’s free 7 days demo. I’ve been looking at using Thinkorswim for paper trading. They don’t accept people from outside the US. At least they instantly denied me after I went through their long and boring application process. My second alternative was using Investopedia’s trading simulator, but it has a delay of 20 minutes. If I’m looking at real time stock charts then it won’t match up with Investopedia’s current stock prices, so how is Investopedia suppose to be useful for me? Am I missing something?

So at the moment it’s 15:13 here and I have to head into town in order to buy a 17 mm socket, some pea protein powder, have dinner with my mom and sister and then probably go visit my friend because I forgot my sweater at his house after partying last week.

What’s done:

  • Registered at TradeZero

 

What should be done:

  • Start paper trading at TradeZero

 

Unfortunately it’s Friday and it’s a long weekend due to Walpurgis Night here in Finland and most people are free from work on Monday as it’s a red day on the calendar. My goal for next week is to paper trade the whole week. If I earn more money than I lose then I will insert around $1-3k on TradeZero and start trading for real 8.5.17.

I’m going to update this post when I have more info, cheers!

 

Update

It’s Wednesday and I haven’t done shit.

It’s Sunday and I haven’t done shit.

I am quitting coffee because as soon as I don’t have caffeine in my blood, I feel sluggish and my motivation for doing just about anything drops. It feels like I’m operating at 20 % of my cognitive capacity. I will try harder next week.

Empty gas, mentally
I’m out of fuel.

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