What is Day Trading?
- Day Trading involves taking a
position in the markets with a view of
squaring that position before the end of
that day.
- A day trader typically trades
several times a day looking for fractions of
a point to a few points per trade, but who
close out all their positions by day's end.
- The goal of a day trader is to capitalize on
price movement within one trading day.
- Unlike investors, a day trader may hold
positions for only a few seconds or minutes,
and never overnight.
What day trading really means.
The term "day trading" is a widely misused
and misunderstood term. Real day trading
means not holding on to your stock positions
beyond the current trading day; in other
words, not holding any position overnight.
This is really the safest way to do day
trading because you are not exposed to the
potential losses that can occur when the
stock market is closed due to news that can
affect the prices of your stocks.
Unfortunately, many people who claim to be
"day trading," hold stocks overnight because
of fear or greed, thus setting themselves up
for the catastrophic elimination of their
capital. When day trading currencies, the
term "day trading" changes slightly. Since
currencies can be traded 24-hours-a-day,
there is no such thing as "overnight"
trading. Thus, you can have open positions
for longer than a day with active stop
losses that can be activated at any time.
Day trading can be further subdivided
into a number of styles, including:
- Scalpers: This style of day trading
involves the rapid and repeated buying and
selling of a large volume of stocks within
seconds or minutes. The objective is to earn
a small per share profit on each transaction
while minimizing the risk.
- Momentum Traders: This style of day
trading involves identifying and trading
stocks that are in a moving pattern during
the day, in an attempt to buy such stocks at
bottoms and sell at tops.
Advantages of Day Trading
- Zero Overnight Risk: Since positions
are closed prior to the end of the trading
day, news and events that affect the next
trading day's opening prices do not effect
your portfolio.
- Increased Leverage: Day Traders have
a greater leverage on their trading capital
because of low margin requirements as their
trades that are closed in the same market
day. This increased leverage can increase
your profits if used wisely.
- Profit in any market direction: Day
trading often will utilize short-selling to
take advantage of declining stock prices.
The ability to lock in profits even as
markets fall throughout the trading day is
extremely useful during bear market
conditions.
- TradersEdgeIndia.com
Day Trading Picks Newsletter specializes
in finding day trading opportunities for
both the scalper and momentum day trader using
technical analysis and the Chaos Theory. Our
trading system in based on chart formations,
technical analysis, chaos algorithms,
fractals and volumes....one that has been
used to successfully day trade the
Indian stock and derivative markets for
years.
- Only TradersEdgeIndia.com Day Trading Picks
Newsletter can accurately predict the
support and resistant zones for the day.
This combined with our trend analysis,
intra-day volatility and stop loss levels
can help any day trader extract maximum
profits from the markets with great
regularity.
- Each day we will email you our list of
Indian stocks to watch for significant
movement in our Day Trading Picks
Newsletter. We will supply you with precise
support, resistance, entry, exit and
stop-loss levels on all stocks.
- Our picks generally are among the most
actively traded stocks. We only recommend
stocks that are in a STRONG trend and have
what we believe to be sufficient resilience,
liquidity and momentum.
- At TradersEdgeIndia.com, we work hard to
help you preserve your trading capital and
avoid many of the pitfalls that most day
traders can fall prey to.
Our Day Trading Picks Newsletter daily
newsletter is targeted at traders looking
for reliable, robust and profitable
daytrading strategies. Interested? Please
visit our
Day Trading Picks Newsletter page.
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