Why having a daily profit target is important?
Currently, I personally do not trade with a daily profit goal in mind, so to answer the question specifically, I do not find a daily profit target important or productive to my "trading happiness". So I will not list a slew of reasons to support that premise.
As a relatively new trader, a daily profit target made me chase the goal, and at times miss opportunities staring me in the face. Therefore, I now focus completely on being daily in a "Trading Zone", of which most I learned at BBT, which includes:
-Strict Risk management (thanks RobertH!),
-Patience & Research (thanks BrianP!),
-Discipline (thanks Carlos!)
- and solid setups on a variety of strategies with at least 2-1 risk to reward that have multiple indicators pointing to going long or short, and developing "feel" (thanks Andrew).
- I also rely on my own research and feeling-knowing about a trade prospect and reading the psych story present in the charts, as best as I can.
Trading Zone VS Profit Target:
For me rather then a profit target, I strive daily to trade with focus and discipline with what the market presents to me on any given day. It does not mean to me that I can't look at my P&L, but I can not give my P&L any say or power over getting me out of my trading zone. For me, this is a psych muscle that I must continue to build and support for it is not in my natural built-in nature. Over trading, FOMO, revenge trading that results in losses are feedback that something is taking me out of my trading zone. It could be a profit target not met, could be I made way over my target and now I'm taking unwarranted undisciplined risks, cuz I'm "getting high" on profits (lol). To me the "trading zone" is the sweaty gym where all the hard work is done, and the P&L is the mirror I can occasionally look at to see the results of the hard disciplined work. I don't want to let the mirror be in charge, the "P&L mirror" is the results of my daily actions, not the motivator.
Be True Yourself (harder then it sounds):
That being said, everyone has to be true to themselves and their unique trading style. There is no right or wrong answer to the question posed in my opinion. Having a daily profit target may work best for many people for many different reasons including one's life circumstances, risk tolerance, genetic makeup, current psychological tendencies, current trading skill level and trading style, an so on. It very well may be the most effective for most people, newbie's and pro's alike.
Style of Trading and Daily Profit Target:
I see that Andrew likes to trade for about an hour or two in the morning on ORB's or Engulfing Bearish Cracks in particular, and then he is done for the day. A daily profit target may work best for him because specifically of that style of trading. I can see where the tendency can creep in to over trade, or trade too quickly in that type of trading style. He is also performing transparently for himself and the community which adds another psychological dimension, ie. time and performance pressures. He is our beloved awesome "Sniper" trader in the mornings, as someone described him recently. So it appears from his comments that a daily profit target works best for his current style and personal psychology. Whereas, I know others are looking for opportunities to trade during the entire span of the day, and perhaps a Trading Zone method without looking at P&L works best for them, or a combo of both at times is likely as well.
The Bottom Line Target: we all want to be happy being a day trader. Happiness and survival in this game does not come from losing more than you are making. So if a daily profit target proves to keep one happy and a winner in the game, awesome. If flowing with what the market represents on a daily basis without a specific profit target works best, then great. Maybe a combination of both suits an individual.
This is a fluid game.
I heavily lean toward a trading zone method as described, but that will likely change and evolve as my trading skill set and style evolves over time. The market is an ever changing river flow, we each will make adjustments and experiment over time. There is no stopping place in this synergy.
Journey Well BBT's.