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What is day trading?

Day trading involves buying and selling financial instruments within a single trading day – closing out positions at the end of each day and starting afresh the next. Day traders buy and sell multiple assets within the same day, or even multiple times within a day, to take advantage of small market movements.

Intra-day trading is not for the part timer as it takes time, focus, dedication and a specific mindset. Day trading involves making fast decisions, and executing a large number of trades for a relatively small profit each time. It’s generally thought of as the opposite to most investment strategies, where you seek to benefit from price movements over a longer period of time.

Share with us your day trading strategies and analysis?

tastytrade and IG.png

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34 minutes ago, u0362565 said:

My advice is don't encourage people to day trade.  Its a buzz word that every newbie comes across first, but its not how you should start trading in my opinion.

Hi @u0362565

Thanks for sharing your opinion.

CAN A TRADER CHANGE THEIR TRADING STYLE?

No trading style need be static and there is every possibility yours can change. You may be a scalper stressed by short-term price action and seeking the free time found in position trading. Or, you could be a technical swing trader who wants to learn more about the fundamentals of the events-driven approach.

Whatever your style or goals, there is always a way to grow and develop, and test your skill on the markets in new ways.

 

Below you will see the different types of traders:

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What type of a trader are you and what is your view and take on day trading or on any of the other different types of traders and how should new traders start? Please kindly share your view and opinion. Thanks.

 

All the best - MongiIG

 

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30 minutes ago, u0362565 said:

Don't touch Forex as a beginner would be my opinion, making sense of something that has no overall direction is hard.

Hi @u0362565

Thanks for your opinion.

Many beginner FX traders look to experienced traders for their knowledge of markets and can have a beginners edge when trading forex. Their knowledge the beginner’s presume allows them to know all the details of the market, however knowledge that can lead to hubris can come at a cost. Traders simply are looking for low hanging fruit on the charts backed by credible ongoing themes and sometimes, the gentlest approaches are best.

 

Instead of outthinking the market, there is a likely better and easier approach. Trade with the trend, use tools like sentiment and pre-trend patterns to help you position in the direction of the overall trend. Always ensure lower leverage though higher balances and using a protective stop. This may not be as exciting a way to trade as you thought was in store but it will likely lead to a more stable and lengthy trading career.

Put another way, can you think simple enough to trade well? Not all can, but the answer to the question is critical.

 

 

“If your mind is empty, it is always ready for anything, it is open to everything. In the beginner’s mind there are many possibilities, in the expert’s mind there are few.”

-Shunryu Suzuki

 

Happy Trading!

 

All the best - MongiIG

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Beginners Guide To FX Trading | Learn How To Trade Step by Step

 

The foreign exchange market, or forex (FX) for short, is a decentralized market place that facilitates the buying and selling of different currencies. This takes place over the counter (OTC) via the interbank market instead of on a centralized exchange.

Article: Forex Trading: What is Forex? FX Trading Explained

Article: Day trading tips for beginners

DailyFX and IG.jpg

All the best - MongiIG

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Hi @jlz

Thanks for sharing.

Pros and Cons:

Range trading:

Pros:

  • Substantial number of trading opportunities
  • Favourable risk-to reward ratio

Cons:

  • Requires lengthy periods of time investment
  • Entails strong appreciation of technical analysis

Trend trading: 

Pros:

  • Substantial number of trading opportunities
  • Favourable risk-to reward ratio

Cons:

  • Requires lengthy periods of time investment
  • Entails strong appreciation of technical analysis

Position trading: 

Pros:

  • Requires minimal time investment
  • Highly positive risk-to reward ratio

Cons:

  • Very few trading opportunities
  • Entails strong appreciation of technical and fundamental analysis

Day trading:

Pros:

  • Substantial number of trading opportunities
  • Median risk-to reward ratio

Cons:

  • Requires lengthy periods of time investment
  • Entails strong appreciation of technical analysis

Scalp trading:

Pros:

  • Greatest number of trading opportunities from all forex strategies

Cons:

  • Requires lengthy periods of time investment
  • Entails strong appreciation of technical analysis
  • Lowest risk-to reward ratio

Swing trading:

Pros:

  • Substantial number of trading opportunities
  • Median risk-to reward ratio

Cons:

  • Entails strong appreciation of technical analysis
  • Still requires extensive time investment

Carry trading:

Pros:

  • Little time investment needed
  • Median risk-to reward ratio

Cons:

  • Entails strong appreciation of forex market
  • Infrequent trading opportunities

A SUMMARY

When considering a trading strategy to pursue, it can be useful to compare how much time investment is required behind the monitor, the risk-reward ratio and regularity of total trading opportunities. Each trading strategy will appeal to different traders depending on personal attributes. Matching trading personality with the appropriate strategy will ultimately allow traders to take the first step in the right direction.

Full article: Trading Strategies and their Pros and Cons by Warren Venketas, Analyst.

DailyFX and IG.jpg

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