Day trading is favored by many traders, although this is not the method we would recommend to start. Demanding and risky, no error is allowed. This is not the method we use on my real trading account, but we try it in particular during the trading competitions that require the closing of positions each night.
No improvisation in day trading
More than ever, you have to have a trading strategy and stick to it. Above all, do not enter the market “because it seems to be starting to go up again”. Have a plan, tested in demo mode before, and follow it to the letter. With the bybit review this is the best deal now.
Your strategy must be precise enough to allow you to find entry and exit points and to place your stops. He must also tell you when to take a position and when to abstain.
Day trading and money management
Here, no risk of risking 10% of your capital on a trade: your money management must be consistent with your strategy, but do not risk more than 1 or 2% of your capital per trade.
Resist the urge to enter the market at any cost
We will say that it is the main defect of the day traders: we know that we only have the day to trade, and from the morning we are on the lookout for the least opportunity. If at noon she did not show up, there is a risk of wanting to enter at any price even if the courses are yoyo in an anarchic way or if it is the flat calm (which often precedes the storm, by the way).
If you are in this case, two solutions:
- Find a currency pair on which your strategy allows you to detect input signals.
- You do violence and force yourself not to enter. If possible, put an order that will trigger automatically under certain conditions, which will save you from spending the rest of the day taped to the graphics.
Move your stop
After, everything will depend on your strategy of course. But we find that day trading is particularly suitable for strategies type “pyramids” . We want to make maximum profits, but time is running out and we have to manage the risks. But if the market goes in your direction, it’s time to go for it.
When you have a winning position and the market continues to move in your direction, put a stop-loss to 0 on this position as soon as possible. Then continue to monitor the input signals to multiply your positions going in the same direction. Thus, you increase your chances of winning by increasing the leverage, but as you regularly move the stop or stops, you do not break your money management rules.