When you are a day trader, what things you need? Apart from the trading platform, chart, money and technical knowledge. You need a 1. trading plan/strategy. 2. Should know when to trade 3. Should know when not to trade. 4.Risk reward ratio. Trading plan/strategy depends on your trading style. Even I analyse/plan my trades, but in experience I have seen market moves in its own way wiping all my plans. So I always confirm my plan seeing the price movement of 15 or 30 mins after market opening. When the reward is more than the risk I enter trade. I wont trade when the risk is more than the reward, when I am confused and when I am sick. In positional trading, you can keep trail stop to protect your profit. In day trading if you sense a weakness in price action, it is better to book profit. I have seen traders who check the top gainers of the day and think, I should have traded on this stock today. Well, you should know one thing, it is not possible for anyone to trade on top gainers stock daily. Its a myth. Dont go after that. Stock selection is the another hurdle traders face. Any good stock wont give good movement daily. In a week 2 days there will be good movement, one day no entry day, and 2 days average movement days. In average movement day, if you are in the trade hoping for good movement you may lose the profit you got. So your trading plan should be suitable for good/average movement. It means your target should be based on average movement. Select few good stocks and stick with them till they have the characteristic of a good stock.
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