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Chapter 11. A day trader's secrets > Your nine essential day trader's rules

Your nine essential day trader's rules

Rule 1

You will not be a scalper

Pit traders can successfully scalp for a few ticks, because they have enormous scalper's advantages. They can buy the bid and sell the offer (you generally cannot), and they pay extremely low fees as Exchange members (fees that can make trad ing for just a tick at a time profitable). Floor traders can react instantly to big orders as they hit the pit, because they can hear the noise rising and know something is afoot—you can't. This logic applies to traders who work for Forex firms and those who create the bid/offer on so-called commission-free trades. These trades are not fee-free, because the retail trader is paying hidden fees embedded in the spread. On the other hand, off the floor can be a big plus, because you do not get caught up in the emotions of the pits, which often result in false messages.


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