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Extreme high volitility can turn position traders (anyone who carries
overnight) into a day trader (one who does not carry overnight). Within
those two groups there are many variations of style and time frame, however
the line in the sand is whether or not you carry overnight. If you carry
overnight in these volitile markets, you must be prepared for 30+ point
drawdowns in the S&P. If you day trade in these markets you can limit
drawdowns to just a few points. Thus the drawdown risk of position trading
in volitile markets can easily run 10 times the drawdown risk of day trading
and one should probably have 10x the capital to position trade as to day
trade. When markets are calm, I emphasize position trading and play more
golf. When markets are eratic I emphasize day trading, work a lot harder,
and play a lot less golf. Other than that, a set of charts is a set of
charts and it's just not that difficult to switch between
monthly/weekly/daily timeframes and daily/30min/5min timeframes. The major
difference is that position traders have more time to consider action than
do day traders.
Earl
>The list heard from a few "position traders" who insist they have an easier
>time of things, letting trades ride overnight. Really, I think these
>people are swing traders, staying in anywhere from an hour to 3 days.
>
>Is anyone earning a consistent living swing trading?
>Does it take *that* much less of a psychological toll?
>How do you deal with a period like the past couple months with markets
>gapping every day, in either direction...
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