Monday, 26 December 2016
Wednesday, 14 December 2016
Mistakes to Avoid When Day Trading
There are many mistakes you can make when trading but some
mistakes come into sight more or are worse in Day Trading. You cannot keep away
from taking losing trades but you can avoid making mistakes or at least keep
them to a minimum.
Many Day Traders
Feels They Need to Be In A Trade All the Time
Just for the reason that you are a Day Trader and thereby an
active trader does not essential mean you have to have one or more positions on
every minute of the day. Many traders feel the require to trade as soon as the
market opens and all the way to the closing bell. Successful Day Trading does
not include trading on “speed”. You still have to stalk your trade. Follow your
rules and strategy and stay patient and wait for the right setup which is the
high odds trade. Do not make mistake of thinking Day Trading means “be in
trades all day”!
Trading Around News
A Day Trader is more susceptible to news during the day.
This is because a Day Trader has a lot tighter stop than a swing trader or long
term trader. So just for the reason that you used to hold during news when you
were swing trading does not mean you can do the same when Day Trading. There
are many kinds of news during the day that can move a stock or future, enough
to stop you out at your tight stop loss. This could be a Fed announcement, ISM
numbers etc. So a mistake to avoid is Day Trading around news as the price
spikes will likely stop you out resulting in a loss.
Another mistake Day Traders often make is not showing up to
“work” prepared. Just because you are a Day Trader does not mean you shouldn’t
work outside the opening hours. A Day Trader should always prepare his trading
day with, at least, the most important things such as support/resistance levels
and what news is coming out that day.
These are only a few of the mistakes that Day Traders make
but be careful and avoid making the same mistake twice.
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