Keep Your Day Trading Simple: Here's How to Do It
The newbie trader can sometimes fall into the trap of doing too much, too quickly. The reality is, though, that in the volatile world of trading, keeping it simple is always best. Rushing a trade can be detrimental – if only because it takes time to become familiar with market behaviours, and to know what techniques and strategies to use to better ensure success. The dogged pursuit of making a million overnight is a fairy-tale best forgotten by the trader.
The answer then is to keep it simple at all times to start, cultivate trading habits that are uncomplicated, and build upon the habits that garner the wins.
In this article, we’ll talk around the technique of how to keep a trade as simple as possible.
What is day trading?
Day trading is a term used to describe the act of buying and selling securities within the same day. Day traders typically buy and sell stocks, options, futures, and other securities in an attempt to make quick profits. While day trading can be profitable, it also carries a high degree of risk.
To note, day traders must be able to handle the mental and emotional stress of rapid price movements and constant decision-making.
Which trading sessions do day traders use?
There are three main trading sessions that day traders use: the Asian session, the European session, and the US session. Each of these sessions has different characteristics and offers different opportunities for day traders.
The Asian session is the first major trading session of the day. It begins in Tokyo and moves westward through Hong Kong and Singapore. The Asian session is known for its low volume and lack of major news releases. This makes it a good time to scalp or trade small price movements.
The European session begins in Frankfurt and moves through London and Zurich. This is the busiest trading session of the day, with high volumes and more volatile markets. Major news releases often occur during the European session, so this is a good time to trade if you are looking for big moves.
The US session begins in New York and moves westward through the United States. This is the most active trading session of the day, with high volumes and volatile markets. Major news releases often occur during the US session, so this is another good time to trade if you are looking for the big shake ups on the market.
Tips for successful day trading
Day trading can be a great way to make money, but it can also be risky. One of the best ways to minimise your risk is to keep your day trading simple. Here are a few tips on how to do that:
Trade a lot size that is comfortable for you
It’s important to trade a lot size that you’re comfortable with. If you’re uncomfortable with the size of your position, you may end up overtrading or making emotional decisions.
Have a trading plan and stick to it
A trading plan can help you stay disciplined and focused on your goals. Make sure to develop a plan before beginning to day trade, and then stick to it as closely as possible.
Don't overtrade or trade based on emotion
This is one of the most important tips for successful day trading. If you find yourself getting too caught up in the excitement or anxiety of trading, it’s time to take a step back and reassess your strategy
Use stop losses to protect your capital
Stop losses are vital in day trading, as they can help limit your losses in case of a sharp market move. Make sure to place your stop losses at strategic levels so that you can limit your potential downside.
Secure profits and don’t hold trades for too long
It’s important to take profits when they’re available in day trading. Once you’ve made a profit, consider exiting your position so you don’t give back all of your gains.
How to choose the best broker for day trading
Now that you know the basics of day trading, it’s time to choose a broker. This can be a difficult task, as there are so many brokers out there to choose from. How do you know which one is right for you? Here are some things to look for when choosing a broker for day trading:
- Look for a broker that offers low commission rates. Day traders make a lot of trades, so even a small difference in commission can add up over time.
- Choose a broker that has good customer service. If you have questions or problems, you want to be able to get help quickly.
- Make sure the broker has a good reputation. Do some research online to see what other traders have to say about the broker.
Or, of course, look no further and come to QuickTrade. Our trader’s platform gives you a range of tools, for better success on the markets. We’ll give you all of the above and more.