I've always wanted to try day trading, whether you are a bull or a bear anyone have any tips or suggesstions?
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Day trading tips
I've always wanted to try day trading, whether you are a bull or a bear anyone have any tips or suggesstions?
From the site in your signature:
"There is something called day trading. This is how it sounds. It is when traders trade daily and try to gauge when a stock is at its low for the day, and then they try to sell it at its high for the day."
I would disagree with this almost completely.
Daytrading is (for all the daytraders I know) about playing the stocks channels and momentum for quick "scalps." A scalp being relatively small change in the stock price but large number of shares to accumulate a profit.
My keys rules/strategies for daytrading include:
1. Follow only a couple stocks to daytrade at a given time, and follow them closely.
2. Annotate channels on the chart. Update them when the channel moves.
3. Annotate pivot points on the chart.
4. Trade the trends.
5. When the trade is entered, immediately know stop and goal points, and stick to them.
6. Only raise goal if a new signal says to, and raise stop with it (consider any change of goal price as an entry of a new trade).
Interesting. I really appreciate that advice and do want to hear more. Obviously day trading isn't my specialty so I'll have to make an adjustment on my site. What you said makes more sense because I feel as though it's impossible to calculate a stocks lows and highs. So how do you analyze a stock chart more thouroughly in detail? How exactly do you read the patterns? (I'm more of a long term investor but am getting more and more into the trading game)
IMO, there are 3 general ways to trade.
The first is investing. This involves understanding of fundamentals, industry potential and the company's place/potential in the industry. Investors don't care what happens day to day or week to week. They are merely saying that the company is likely to perform well and they believe that the company will outperform the industry. These traders are mainly focused on fundamentals.
Swing traders would be the second set of traders. They are using technical indicators on a short(ish) term scale coupled with company fundamentals to determine daily or weekly chances of their pick going up. They are mainly focused on technical indicators but use fundamentals to help make their picks.
Day traders are the third set of traders. They are using market momentum and technical indicators to make trades. The company/industry do not matter and what they trade depends 80% on volatility of the equity and 20% on the chart patterns they see. Fundamentals do not matter to the day trader at all.
