Day trading tips can come in a variety of forms. Each trader might want something different – from free stock tips, to tips on tax when day trading. On this page, we have tried to collate as many useful tips as possible, including our “top 10”. These range from psychology to strategy, money management to videos. So from beginners to advanced traders, we explain a range of free tips that can help intraday traders.
Top 10 Day Trading Tips
With a multitude of tips and tricks out there, what are the top 10 you should know about?
1. Always have a plan – The most important of all tips on day trading. Don’t put real money on the line until you have a plan of action. That means know what you’re buying and selling, how much you’re going to trade and when you’re going to trade it. A trader without a plan is a pig heading for an expensive slaughter.
2. Manage risk – It is vital you sit down and develop a risk management strategy. This will ensure you only lose what you can afford. Without one of these, your time as a day trader could be extremely short-lived.
3. Harness technology – With thousands of other traders out there, you need to utilise all the resources around you to stay ahead. With that being said, charting platforms offer a huge number of ways to analyse the markets. You can also backtest your strategy against historical data to fill in any cracks. Mobile apps will also ensure you have instant access to the market, almost anywhere. Combine that with a lightning fast internet connection and you can make fast, informed and accurate decisions.
4. Never stop learning – The successful trader never sits on his laurels, he’s always looking to trade smarter. Doing that means staying up to date with the news, utilising trading books, and staying tuned into emerging schools of thought. Markets evolve and you need to evolve right along with them.
5. Lead with facts – Make sure your strategy is based on, supported and backtested with facts. Humans are emotional beings and after a big win today you may be feeling abnormally brave when the markets open tomorrow morning. Don’t fall into this trap. Let facts and figures guide your decision-making processes.
6. Have entry and exit rules – There is no such thing as the ‘perfect entry and exit’. Stick only to the entry and exit parameters in your plan. If you start thinking ‘maybe I should see if this works’, think again. Maintain discipline and your bottom line will thank you for it.
7. Don’t concentrate on the money – This may sound counterintuitive, but it makes good sense. Having money at the forefront of your mind could make you do reckless things, like taking tiny profits in fear of losing what you’ve already won, or jumping straight in so you don’t miss a move. Instead, focus on sticking to your strategy and let your strategy focus on making you money.
8. Take responsibility – Too many traders lose and then proclaim the market was out for them. By not taking responsibility you won’t learn from your mistakes. Whatever happens, point the finger at yourself, in a constructive way. What did you do wrong? How can you stop it happening again? Do you need to amend your trading plan?
9. Keep a trade journal – Keeping a record of previous trades is an invaluable tip. Software now enables you to quickly and easily store all your trade history, from entry and exit to price and volume. You can use the information to identify problems and amend your strategy, enabling you to make intelligent decisions in future. You never meet a trader who regrets keeping a trading journal.
10. Know when to stop – If the strategy isn’t working, don’t keep throwing money at it. Go back to the drawing board and think again. If you can’t stick to your plan, don’t sit in the hot seat, you’ll only start on a slippery and a dangerous slope, and there’s definitely no money at the end of it.
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