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.
Note : Please share your views about day trading and spread your knowledge. Knowledge grows by sharing.
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Dear friends, please share your views.
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nalinakshi
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what you say is 100% correct, I agree , it will wipe out all our plans. i do study make plan, in the opening price will have wild movements, you tend to forget the plan. now i have disciplined myself to make note of levels, upto 15 minutes, i do not change the chart setup to any 5 minute or one minute setup, I have started watching colly on one day set up, later if i see the green bar then i decide to trade in that direction and shift to 5 minute setup. I use bollinger and keltner channel and true strenth indicator. i usually wait for certain patterns to develop as it is very essential if you want to make money. You need momentum setup to make money. I usually avoid the setup when price starts to consolident, it will be evident by seeing keltner channel and bollinger band squeeze. day trading gapdown and pull back will reward you more. but it is important to know the trend. true strength indiacator and direction of the keltner channel helps me to decide. patience and stop loss is very important in day trading. i usually watch certain price bars to decide for the reversan in price.
vanathi
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@nalinakshi, Your view is very valuable. Thank you for sharing :)
shiv_n
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@nalinakshi, madam not tunderstand what you say if you give example with chart then may be i understand pls help me.....
@nalinakshi, Can you share a chart here as an example?
nalinakshi
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@vanathi, i have given the link . forexfactory.com/showthread.php?t=217281&page=4 here lot of examples you get in this thread, it is forum. You get to see these setup in our daily stock trading. definitely I wil l search for one set up and post you.
@nalinakshi, madam you say if we see this setup then should go for short but which condition met then we going for short ???? can you tell here which condition importnat for this setup for going short trade?????
nalinakshi
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@shiv_n, first you must study the daily chart, and you must know the overall trend of the stock , general trend of the market, and you must pracice very hard to learn, first you practice by paper trading the setup. you must understand what the keltner channel indicates, everything you should know. I have shown the example just observe with your open eyes what picture is giving, you can see the flow of the direction.it is vey hard to explain, but by daily observing and practicing you get to know the pattens and get familial with the setups. i am tlling for intraday tradiing