I am an Idiot

Well, this isn't about my account. I never being wiped out because I always added funds he3x.

It's about my friend. Actually he lost $2000 which is most people it's small. But for him it's big. First he traded around $500, wiped out. Then $1000, I invested $500on him, also wiped out. Last account $600, recently wiped out. I don't know what's wrong with him, but his trading method heavily rely on news and technical analysis. He traded Options by the way.

You may think this guy is a stupid dumb a**. But he's smart. Smarter than me actually. He can spot hot stocks and most of the time he did it right. He is a great influencer. His talk is very convincing. Sometimes I was attracted with his trade and also bought same stuff with him. Why he wiped out his account? simple. options expired worthless. All of them. Not consistent Stop Loss, Profit Taking too early, which I did it also. The scenario run like this. He bought 1 contract, the price moved against him, or just slightly break even. He wanted to keep it overnight. Next day the price gapping against him. He got out with quite big losses. And the price went back to his favor, almost like it had eyes on him. Sometimes almost exact price before it reversed. He felt angered. He was right but taking too early. And he never re-entry because emotion and pain clouded his judgement.
Other day, he may bought another contract. Maybe different stocks. And the price dive again and he kept it overnight. This time he won't stop losses. And guess what, the options became worthless, his account were wiped out.
I never mentioned about profit taking because he never took big profit. Always small profit. 3 same mistakes, did it over and over again. He still smart actually. But I think the way he took is slightly wrong.

And in daytrading, I'm still thinking that more idiot = better result. Gave him/her top notch trading system, and that's it. No news, no bias. Just chart, trading system, money management, just trade it. Smarter you are, more question appeared, and you may miss the entry or chasing the price. Everybody want to become Jesse Livermore, who could outsmart the market, or Analytical thinking like Kenny Roger guy. Well, it's good to become a great man. But in reality, especially day trading, those skills is not very important. All you need to do is spottted where the market likely to go TODAY and go with the flow. Sounds easy right, it took me 3 years to realize that. This week I implemented purely the trading system. No discretion entry. I bought an overprice CL, selling the cheap 6B, and so on. I just following the system. Result : Not bad, $500++ in 5 days. It's small but have big potential in it. The result may double if I just waiting another 5minutes for profit taking. That's it. To make it double again, I just need adding 1 more contract which I still can afford.

Stupid man = Good Trader
Smart man = Good Analyst

Smart man : Are you crazy? You bought the CL on all time high? It's already moved $2 intraday. Very soon the price will dive south, don't you know the inventory is good, APEC don't want to reduce supply. bla bla bla...
Stupid man : Gee... I don't know. I just follow my system. It's buy signal. Putting my SL intact and waiting for the result.
Smart man : your system is bag of c**p. Use your head. You followed the herd buying the overprice CL. Soon you will realize your stupid trade.
Stupid man : Well, if I was wrong, my SL will do the job, All I need to do is waiting for another setup whether it's buy or sell I don't care. I am not smart enough analyzing the news, sentiment, opinion,etc. I just checking my system and my trade. That's all.

Oooh, I wanted to become the stupid man. And this week, I am this stupid man :)