Intraday trading is also known as day trading; it deals with the buying and selling of financial securities within the same day, before the market closes. New-comers to intraday trading are more likely to be at a higher risk of going at a loss. This is mainly because it deals with high amounts of speculations and the novice is more likely to succumb to the volatility of the market. The good news is, there’s no trader who always makes profits (even the best of the best normally make profits 50-60% of the time).
Normally, it’s a way to earn quick cash; of course if you play the game right. This type of trading can lead to someone into making huge to small amounts of money or go at a serious loss. Well, this does depend on how somebody handles their position. A big advantage of this; overnight events (be it good or bad) do not affect the trader in any way due to the markets closing at 8pm.
There are a couple of strategies that you could use that would most likely make them handsome amounts of cash. Being disciplined, accurate and diligent can really come in handy. Even if you know everything that needs to be known; if you don’t have these qualities, you’re most likely to fail. Another important thing to remember when day trading; please keep your emotions at bay.
Day trading is considered to be quite strenuous and if you don’t keep your emotions in check, they could lead you to make stupid mistakes. Being patient is another key factor; it may require you to sit in front of their computer for long amounts of time. This could be quite demotivating and could lead a somebody to either opt out or make impulsive decisions; this can lead to serious income deprivation.
The worst thing to ever do is, relying on your gut feeling to make decisions. Gut feeling will not earn you any cash, statistics and carefully calculated predictions are what will make you that money. Moving on to the more technical bit; having great amounts of knowledge about companies can really help an individual. This helps traders have a deeper understanding and pick out the best options that will make them cash.
Finding out your skill set that will suit the preferred style; it’s just like finding your niche. This is important because he/she will be more into it; it’s considered a game changer (in some cases). As a beginner, you are advised to deal with smaller positions; this is important when trying to avoid going at a loss. People should have a clear and well calculated plan or strategy before trading; this is very important because it prepares you for any obvious outcomes.
A strategy helps an individual to navigate through things easily and more cautiously; without a plan, an individual is at a higher risk of inquiring price deprivation. Determining both the entry and exit price before committing to any position is quite effective too; this helps someone to set a designated limit. Learning when to close off is important; it should be considered as a daily routine, be it you’re making profits (this will boost your discipline). Before engaging in anything, he/she must understand in-depth terminal analysis and patterns of how things work.
This is due to the fact that it will help the individual to make better and more accurate predictions and of course help them to have a deeper understanding of how things work. It’s advisable for you to know when to place a stop loss trigger; this will lead to really helping him/her limit their potential of losing money. This is different from close off because close off will require you to exit whether you are making a profit or a loss.
It’s advisable to join most favored platforms; the likes of, FXTM, Pepperstone, IC Markets, BEML, LUPIN, etc. This is important because these platforms have more activity than most and will increase the chances of a trader earning more profits. Checking the volatility of the market is quite effective; measuring price movement of the day is great, it does help him/her know whether they are making the right decision or not.
Choosing the right time to trade is compulsory; the most rewarding times to trade are between noon and 2pm. Although, there are irregular times in which massive opportunities for traders emerge; this just shows that there isn’t a definite time that is perfect for trading. Consistency is key when participating in day trading; it may require a trader to sit staring at the monitor for a long time; opportunities come and go.
You shouldn’t be demotivated or discouraged; it does take a lot of ones mental and physical energy to precisely stick to the plan (rewards are worth the suffering). Setting up an experimental account would be advisable; this account is a guniea pig and would serve well for beginners, to avoid losing money. As a participator, you should really try their best to manage risks well and minimize their losses.
Avoid committing to options that trade against the market; this will just lead an individual to definite losses. Trading with strong stocks that are on the uptrend will guarantee profits, be it huge or small; downtrend will surely guarantee a beginner huge losses. Managing the amount of money that comes out of your capital is important; most successful traders usually don’t risk more than 3% of their capital. Giving up such small percentages away is advisable; if you do inquire any losses, they won’t be a lot.
For beginners, it’s not advisable to be investors; there is a huge risk of going at excruciating losses. Having 2-4 liquidity shares is also considered important; most investors normally hold shares due to low trade. More options will increase the chances of a trader making great cash. Scalping is another effective way of day trading; this is trading when the markets only become profitable. This will require him/her to keep an eye of the market after every minute.