Day trading is among successful trading strategies nowadays, it is the process of buying and selling of a security within a single trading day, it usually occurs in any marketplace, but mostly in the Forex market and stock market. A day trader is an investor who tries to make a profit by making rapid trades intraday. Day traders often close out all their trades before the market close and don’t hold open positions overnight. Some of them use leverage for magnifying the returns that are generated from small stock price movements. A Day trader serves the following 2 critical functions in the marketplace: keeping the markets running efficiently via arbitrage and providing much of the liquidity in the markets, especially in the stock market. Day trading isn’t complicated, if you learn a simple, rules-based strategy to anticipate market moves. In this article we’ll consider several secrets of day trading that can be useful for beginners.
Setting price targets before you jump in
If you wish to buy a long position, then you should decide in advance how much profit is acceptable (as well as a stop-loss level, if the trade turns against you) and try to stick to your decisions. This will help you limit your potential loss and keep you from being very greedy, when the price spikes to an untenable level.
Try to focus on several strategies that suit you well
There are a lot of traders, who attempt to implement too many strategies at once and think they should make money every day. Successful traders usually have a few strategies or just one strategy that they are highly successful with. Find a strategy that you are comfortable with and try to master it and keep in mind that this won’t happen overnight and that no strategy works in every market.
Patience is essential, as you will make mistakes and it will take some time for you to get comfortable with your trading decisions. You have to wait a while in order to find a good trade and sometimes you can have a losing streak. So, don’t worry too much about it and try to set maximum losses per day, week and overall. Keep in mind that as long as you stay in the game, there will always be another day with new trading opportunities.
Forex Day trading is becoming increasingly popular among inexperienced traders as well, so are you ready to jump into day trading?