One Question Interview with Ugly

August 1st, 2006

Another One Question Interview, this time from Ugly from Ugly is a day trader who “dummy trades” high alpha stocks and does quite well. His blog is a good one to follow because he posts honestly about his trading and he’ll throw in interesting posts like this one. I did a full interview with Ugly a few weeks back.

Here’s the question for the first round of One Question Interviews:

What trading lesson(s) have you learned from the downtrend that started in May?


I started day trading full-time at the end of January this year. The most valuable lesson I have learned the last few months is that I can trade profitably in a down-trending and choppy market. This is important because it gives me faith and confidence in my system, which will hopefully help me to stick to it during the dry spells.

I’ve also learned that day traders don’t have it as bad when the market breaks a large trend. For longer-term and swing traders, it was tough out there the last few months. At least from my point of view. In my opinion, it was harder to predict and take advantage of such a sharp decline from a longer timeframe. As a day trader, each day is a new day and is treated the same way. I also saw a lot of stocks that seemed to set up one way and then gap in the other direction. I don’t have to worry about gap opens with any of my positions, because I don’t have any positions at the open.

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