When it comes to maximizing trader performance one thing I've always believed is how important it is to take full advantage of a trading day when the market is moving well and providing high quality opportunities to trade. This seems obvious enough but in my experience I've found many novice traders have limiting beliefs and actions that hold them back and at least some of this can be attributed to the oft-parroted saying that a day trader "just needs to make 2 points a day" to realize their dreams of wealth and freedom.
It's true that someone making 2 points every day can become an incredibly profitable trader. Nobody is doubting that on its initial face value. If you can make 2 points per day with one contract you're doing fine but if you can make 2 points per day every day with 10 contracts you're making a very substantial income and there's no reason you can't ramp up the position size from there.
The issue is that when our focus narrows to the outcome of a single day or even the outcome of a single trade it can actually make long-term profitability that much more difficult to achieve.
Making just a couple points while day trading Emini S&P 500 futures isn't actually all that difficult. Often you can pull that kind of profit out in a half hour or less. The difficulty is in actually keeping it and, more importantly, regularly exceeding it to balance out those days with less than stellar results.
The reality of trading is that every day is different and some days are certainly better than others. There's plenty of days where you can make a couple of points quickly but there are some that start slow with limited action where it takes a bit more time to find the trades that fit your trading plan or other days where the market enters into a whipsaw period that can cause a loss or two.
While veteran traders who are able to trade the full morning can realistically make profit nearly every day in spite of these conditions there are those who have a more limited trading window or market novices that will have break-even or losing days (though such losses should be kept small thanks to firm limits on overall risk).
Due to this it's important to realize two things. First, that a trader should generally have a longer term outlook on their trading. If you focus on "making just 2 points per day" it tends to put a lot of emotional weight into the outcome of every trade. Suddenly every trade carries more importance and the emotional burden on a trader can significantly increase thanks to just a single trade possibly meaning daily success or failure. This extra emotion added to the trading process rarely leads to more profitable outcomes.
As traders we must understand that our trading edge needs some time to play out even if our overall trading expectancy is very strong. The outcome of a single trade or even a single day doesn't determine much. What matters is following our plan, taking good trades that fit our rules, and letting our edge play out over a larger sample of trades. This is why I have the day traders in the STA Training Program focus on weekly and monthly results while considering their edge over samples of at least 20 trades.
Second, outlier trading days that offer far more profit potential than the average are essentially the "keys to the castle" when it comes to extreme profitability. You can still be profitable without them but taking advantage of the one or two days with high potential during the week often means the difference between decent weekly results and exceptional ones.
You can do all right by setting an artificial 2 point limit on your daily profit but some days offer far, far more. Take Thursday for example, a day that had numerous high quality market swings and plenty of profit potential as you can see in my charts. If you only came out of a day like that with a tiny 2 point profit you're severely limiting your overall profitability and potential!
This is why I will always continue to trade for longer than my normal 2 hours or so on a given day if the market is moving exceedingly well and trading outcomes are highly predictable. It's not about being greedy or trying to hit some specific dollar figure for the day - it's about taking one good trade after another and continuing to do so if the market is offering the opportunity.
There's plenty of days where I might just trade for an hour to pick up some points and call it a day if the market isn't moving particularly well. There are times when other activities call me away after only a short period of trading. However, when the market is moving well, the setups are excellent, and the trading outcomes are consistently in your favor then it's usually best to trade until those conditions change.
Sure, I could have had my 2 points after the first three trades on Thursday and called it a day in about 15 minutes but look at all the potential opportunities I would have missed on a day of exceptional price movement. Considering it turned out to be the most profitable day of the year so far for myself and many STA traders it's a good thing we didn't pack things in!
If the market is doing its part to put the numbers firmly in your favor then don't let the opportunity pass without taking advantage - strike while the iron is hot!