Forex Day Trading Tips You Should Know
Intraday trading is where you create entry and exit positions in the same trading day as one of the day trading options for a living. In other words, you make suitable trades when the market opens up until the time that it closes at 4 PM each and every day.
Because of how the stock market operates, intraday trading is much riskier and if you do not know what you’re doing, you could potentially lose a lot of money in the process.
Luckily, since this is nothing new, there is plenty of information out there that can help you win big in day trading. If you’re investing in the Forex, here are some day trading tips that you should know.
1. The Art of ‘Scalping’
Scalpers are, by definition, the real active day traders. These are people who are constantly looking at the stock market with an eye for even the most minute price changes.
These are the people who leverage the stock market’s volatility to their own advantage. This can be an exciting activity, but do note that this type of active trading is also the riskiest as well.
They are more focused on the quantity of trades as opposed to the quality.
You have to note that if you’re looking to become a scalper yourself, time is of the essence. As soon as you’ve acquired shares and there is even a slight price movement upward, you should look into selling your shares as quickly as possible to take advantage of this short window of opportunity.
2. The Art of ‘Reverse Trading’
If you do not want to be a scalper and you want to take a more ‘calculated’ risk, then you may want to try Reverse Trading.
Simply put, reverse trading is just the act of not following the general market trends. Instead, you use all available data so that you can push through with trades that you think are going down (at this time) that will eventually go back up (known as a pullback) before the stock market closes.
The art of reverse trading looks simple on paper, but it actually isn’t. As I said, this approach is more calculated as it is looking closely on the quality of the trades as opposed to the quantity.
This requires a lot of practice to pull off, but once you get the hang of it, you will find that you can earn big bucks by using this strategy.
3. The Art of ‘Momentum Trading’
This is arguably the hardest day trading strategy to boot. It is hard because you’re actually going to predict the momentum of a particular market.
Simply put, Momentum Trading involves searching for a particular sector where the share prices are generally moving upward and there are plenty of trades in the day.
As you know, the stock market is highly volatile which means that no one can actually predict how the stock prices move. What you can only do is try to predict it and you will exit as soon as you see that it is the best time to do so.
Day trading can be difficult and there are plenty of strategies that you can employ. You just have to find the right thing for you so that you can earn maximum profits each and every day.