Hi Bella:

Hey young fella.

Thanks very much for putting some much valuable material on your blog and website.

Thxs for following us.

Although I didn’t receive the opportunity of a summer internship with SMB, your website certainly provides quite a learning experience for me.

Freakin SMB HR!

I especially appreciate your classroom style of challenging your trainees to prepare for more trading scenarios than I even thought possible although at times it could be intimidating.

It’s called active learning.

Right now I am in training with a future prop shop focusing on emini Dow. While fine-tuning and discovering my own trading style, I have a few questions as following. Maybe you could shine some light on it.

Shoot.

My question comes from reading your book One Good Trade.

#1 trading book in the world!

1)You mentioned the importance of focusing on your skills instead of P&L. I wonder if I should still set a limit loss every day as part of your training even on simulator.

Yes you should treat trading on the demo just like if you were to trade live.

2)You mentioned both the importance of setting a daily loss limit of half of your median gain and bouncing back from defeat. For instance, if your daily loss limit is $200, and you were down $200 at the open, should I continue trading and potentially lose more or should I stop?

You should stop.   For the intraday trader hitting your stop generally means you are not seeing the markets well.  We want to trade more when we are on our game and minimize our losses when we are not at our best.

3) From the same logic, in his book Mastering the Trade, John Carter says that after 2 losers in a row he would stop using certain setup. I wonder how you would go about quickly determining certain setups are not for the day or market?

After three losses I ask is there an adjustment I can make to trade this stock better.  If there is I might stay with the stock.  Sometimes it is just getting the pattern right with the stock which might take a few trades.

4)Where could I find some of the top traders that I could follow online?

http://www.businessinsider.com/traders-ask-what-bloggers-should-i-follow-2010-9

5) What are some of the books you would recommend on Day Trading and Tape Reading?

As GMan would say, “Ok Bucko that is enough questions.”  I will save this answer for another day 🙂  I have to go get my game face on for the Big East Final (UConn).

Thanks very much for your time.

Great questions.  Thanks for reaching out to us.  Keep working on your trading game!

Mike Bellafiore

Author, One Good Trade