Would $7000 be considered to small of an amount to trade with?

I paper traded for 6 mths with great results and went live in Nov 2009.My first trade I made a profit of $881, but since then I've been on a losing streak .

I'm still fighting for freedom ,I am not a quitter ,but worried that I may not have enough in my trading bank left to continue?

How many paper trades did you do in the 6 months?
What was the win/loss ratio like?

I'm still paper trading so I can't give you anything other than opinion. I would have thought $7K was alright but you have the risks of underpowering.
I would look at why you were getting different results when trading live. Did emotion cloud your judgment?

In the Method Notes section I wrote this brief explanation of why I think this method needs a bit of umph behind it.

http://www.onedaywealth.com/forum/showthread.php?t=729

Basically there is only a certain amount of movement we can expect on a normal day in the options "arena". I figure 5-10% is about right a few times a week. You can apply that to your size bank and see if the returns after fees excite you or not. They very well might.

For example, 5% of $7,000 is still a few hundred dollars and that can be fun. I used to work all night in a factory for less than that. You can always sharpen your skills and do deeper research into charting...etc. The better chartist you become the more money you will make or the less you need to make what you want.

There is only a problem when you expect your money to do something that just isn't going to happen. Such as...expecting 50% returns every day. I found that the options market generally dishes out 5-10% and more on a regular basis. With a 20k account you only need to catch one of those a week and you're set. With a 10k you'll need twice the amount of good trades. Then there's the losing trades.

The losers are what will usually determine your success. It's tough to lose. How it affects you will determine your success. With 5k you can build a handsome bank if you get a few trades right in a row and I guess that's the "hope" with small accounts. We all know how hard it is to save and I don't want to discourage anyone for fighting for freedom with whatever they can scrape up but the fact is that up to a point, the less you have the more risk you attract. With a decent bank you can get in and out quickly in the general and normal movements of the market.

I think it's better to fight with what you have than to drudge back to work in despair. As long as you know the power you need to pull it off with relative ease.