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How to Swing Trade
The Complete Swing Trading Course
The Complete Swing Trading Course
If you’ve never investing in the stock market before, this course is for you!
Learning how to swing trade can help you improve your stock portfolio performance. Check out Benzinga’s guide to the best swing trading courses to help you choose the right option for your investment education.
Best Swing Trading Courses
Why Learn How to Swing Trade?
Swing trading is a style of short-term trading — you buy an investment and sell it off in a shorter period of time to capitalize on day-to-day volatility.
A swing trader might hold onto an asset for as little as a few days or as long as a few weeks. Most swing traders use technical analysis to determine which assets to buy and sell. In other words, they don’t pay as much attention to fundamentals like a company’s potential or products as they do price indicators to predict whether an asset is currently undervalued.
Why should you learn how to swing trade? Swing trading has a number of benefits you can use to enhance your overall portfolio.
Swing trading lets you quickly test how well your strategy is working because you sell off assets shortly after you buy them. You’ll often be able to estimate the success or failure of your trading strategy in as little as 1 week.
Monthly Income Potential
You don’t need to wait years or even decades to see profits so you can create a solid stream of relatively passive income by making only a few trades per month or per week.
Avoid Pattern Day Trader Designation
Be aware of the SEC’s pattern day trader designation. The Pattern Day Trader Rule is a regulation set in place by the Financial Industry Regulatory Authority (FINRA). It states that if a trader makes more than 3 day trades in a 5-day period, he or she will be labeled a pattern day trader. Once you’re considered a pattern day trader, you must maintain a consistent balance of at least $25,000 in your account. If the balance dips below $25,000 and isn’t restored within a short period of time, you can be banned from making future day trades for up to 90 days.
You can get around the pattern day trading rule by swing trading if you have less than $25,000 of capital to trade. A day trade occurs when you buy and sell a security in a single trading day. If you wait just 1 business day after you buy an asset before you sell, you aren’t making a day trade. Swing trading is a great way to hone your skills without a massive amount of upfront capital.
Our Top Trading Courses
You’ve decided you want to learn how to swing trade — so where should you start? Online courses provide a convenient and affordable way to learn new trading strategies and put them to use. We’ve rounded up some of the best swing trading courses and organized them by skill level.
Best Swing Trading Courses for Beginners
Just getting started? Let’s take a look at some of the best swing trading courses for total market beginners.
The Complete Swing Trading Course
If you’ve never invested in the stock market before, the Complete Swing Trading Course is an amazing place to begin. The course is for absolute beginners — it starts with an introduction to how the stock market works before moving onto different forms of analysis and how to formulate a solid swing trading strategy.
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The Complete Swing Trading Course includes a free TradingView account to assist with charting and includes over 4.5 hours of on-demand video to help you learn to recognize technical patterns and make profitable trades.
Swing Trade Stocks and Forex with the Ichimoku Cloud
Swing Trade Stocks and Forex with the Ichimoku Cloud is a beginner’s swing trading course that focuses on recognizing and utilizing the Ichimoku Cloud. The Ichimoku Cloud is a technical indicator that defines support and resistance levels. It’s widely used by swing traders to determine the best time to buy and sell.
The course is short and sweet — about 1 hour of total course material is divided over 11 lectures. You’ll need a basic understanding of how trading works to effectively complete the course, but jargon is kept to a minimum.
Day Trading and Swing Trading Strategies for Stocks
Day Trading and Swing Trading Strategies for Stocks is a great choice for total stock market beginners who want to start off with a strong technical foundation. The course focuses on 3 unique strategies spread out over a 27 lecture series. It introduces both new and experienced traders to common swing trading strategies. At the conclusion, you’ll receive a free Excel trading sheet to track your progress.
Best Intermediate Swing Trading Courses
Consider an intermediate course if you need something more advanced. These courses require a basic understanding of how the market works but require no in-depth technical knowledge.
Technical Analysis Masterclass: Trading by Technical Analysis
Technical Analysis MasterClass is a crash course in the basics of technical analysis — a crucial function for swing traders. Over the course of 72 lectures, you’ll learn the basics of technical analysis and how you can use different indicators to inform your trades and place trend lines. The curriculum includes 7 hours of online video, 2 practice tests and plenty of hands-on exercises to help bring your trading to the next level. Like all Udemy courses, it also includes a 30-day money-back guarantee.
Easy 5-Step Fibonacci Swing Trading System
Fibonacci retracement patterns are a common technical indicator swing traders use to inform their actions. The 5-Step Fibonacci Swing Trading System on Udemy lays out a series of 17 on-demand math lessons to help you learn how to introduce formulas into your trading strategy.
You need the basics of both swing trading and the stock market as a whole, but a high level of mathematical understanding isn’t required to jump into the material. The course provides a solid, easy-to-follow explanation of a common and effective analysis strategy.
Forex Swing Trading Strategy – Live Day Trading Examples
Forex trading is a type of trading that involves buying and selling currencies. Once you get a handle on swing trading stocks, funds and other assets, you might want to try your hand at forex trading. Udemy’s Forex Swing Trading Strategy course introduces you to forex swing trading with live daily trading demonstrations. Follow along as your instructor performs real forex trades with explanations. Then try them out yourself using your own brokerage platform.
In addition to live demonstrations, the course also includes about 6 hours of swing trading information and instruction. Over 300 students have completed Forex Swing Trading Strategy, and users rated the course at an average of 4.9 out of 5 stars.
Best Advanced Swing Trading Courses
Looking to further your swing trading knowledge? These courses help advanced traders strengthen your skills.
Forex Trading — Advanced Fundamental Analysis
- Who it’s for: Forex traders who want to extend beyond technical analysis
- Price:On sale
Fundamental analysis involves looking at company and currency news to evaluate the value of an asset. Forex Trading — Advanced Fundamental Analysis is an expert-level course in fundamental analysis that can help you add another layer of theory to your swing trading. The course includes about 5 hours of instruction spread over 49 lectures. The strategies you’ll learn can also be applied to stock and other markets as well.
Reversal Candlestick Trading Strategy
Consider Reversal Candlestick Trading Strategy if you’re curious about adding another technical analysis strategy to your repertoire. This class begins with an in-depth explanation of candlestick charts and assists you in interpreting and predicting candlestick formations based on the reversal method. It includes about 2 hours of total course material spread over 26 lectures. Instructor Syed Rahman has also created a full set of written supplementary materials. The course is one of the highest-rated on Udemy — 4.7 out of 5 stars and more than 2,200 students.
Advanced Swing Trading Strategy — Forex Trading/Stock Trading
- Who it’s for: Advanced traders interested in high-level swing trading strategies
- Price:On sale
Advanced Swing Trading is another strong course from one of the most prolific forex and stock swing traders on Udemy. Through 49 lectures and about 5 hours of material, you’ll learn more about how the stock and forex markets work, along with more strategies to enhance your swing trading. Like Rahman’s other courses, this includes articles and written supplementary materials. Advanced Swing Trading is a strong option for advanced traders, with over 5,700 students and an average rating of 4.6 out of 5 stars.
Improve Your Swing Trading
Further your financial education by investing in a swing trading course. If you’re not ready for a course, there are also plenty of free online resources you can consult to help you create better trading results. Check out our list of the best stocks to swing trade and the best online brokerages to get started.
Using Futures to Capitalize on Opportunities During the Coronavirus Pandemic Panic
March 25, 2020 by Daniels Trading | Tips & Strategies
The 2020 outbreak of the novel coronavirus (COVID-19) has driven unprecedented participation in the global financial markets. Heavy daily traded volumes and extreme pricing volatility have become new norms. Although the risk profile is greatly enhanced, active traders are privy to rare opportunities.
No matter which market you are looking at, it is highly likely that extreme pricing fluctuations have defined early 2020. One way to capitalize on the action is by trading futures contracts. In doing so, you can maximize your capital efficiency and benefit from the COVID-19 panic.
Micro E-Mini and E-Mini Equity Index Futures
Late February and early March of 2020 brought a chaotic period on Wall Street, featuring several history-making events. Multiple coronavirus-driven market crashes rivaled those experienced in 1987 and 2008. For the period of Feb. 27 to March 12, the Dow Jones Industrial Average (DJIA), S&P 500 (SPX), and NASDAQ Composite (NASDAQ) were extremely active:
|Date||DJIA||S&P 500||NASDAQ 100|
|February 27||-1191 (-4.4%)||-137 (-4.42%)||-414 (-4.61%)|
|March 2||+1294 (+5.09%)||+136 (+4.60%)||+384 (+4.49%)|
|March 9||-2020 (-7.7%)||-225 (-7.60%)||-624 (-7.29%)|
|March 10||+1167 (+4.8%)||+135 (+4.94%)||+393 (+4.9%)|
|March 12||-2352 (-9.99%)||-260 (-9.51%)||-750 (-9.43%)|
As you can see from the table above, the impact of the coronavirus on U.S. equities was staggering. Emergency rate cuts from the U.S. Federal Reserve, surprise economic stimulus packages, and constant COVID-19 headlines drove unprecedented participation to the markets. Unfortunately for traditional “buy-and-hold” investors, profits could only be secured from bullish bumps in stock prices, not the sell-offs.
One of the premier benefits of equity index futures is flexibility. Trading the Micro E-mini and E-mini equities indices has several key advantages over stocks or ETFs:
- Implement bullish or bearish strategies
- Apply enhanced leverage courtesy of reduced margins
- Pay low all-in commissions and exchange fees, free of management costs
- Enjoy consistent market depth and efficient market entry/exit
Access to leverage, ability to go long or short, and low cost structure make Micro E-mini and E-mini equity index futures ideal for engaging the U.S. stock markets.
COVID-19 Impact on Commodities
Stocks aren’t the only assets driven directionally by the COVID-19 pandemic. Energies, metals, and ag products have also displayed a keen sensitivity to the spread of the virus.
The impact of the COVID-19 on commodity pricing is multifaceted. During uncertain times, investors often turn to assets such as gold to hedge against unknown risk. This was the case throughout Q1 2020 amid the coronavirus outbreak. From January 1 to March 12, spot gold rallied by 3.8 percent, posting new all-time highs above $1,700.00 in the process.
Conversely, COVID-19 brought serious demand-side questions to the global oil complex. A projected economic slowdown and lagging Chinese consumption caused West Texas Intermediate (WTI) and North Sea Brent (Brent) futures to post multiyear lows. Agricultural commodities faced similar demand-oriented issues. Livestock, grains, and oilseeds all came under immense bearish pressure as COVID-19 hysteria coupled with U.S.-China trade strife ravaged the markets.
Once again, the inherent flexibility of futures provided participants the ability to trade market fundamentals. Whether buying gold futures as a safe haven or selling ag and energies to profit from demand-side uncertainty, futures can help you competently manage the evolving COVID-19 situation.
Using Futures to Trade the Coronavirus Pandemic
On March 11, 2020, the World Health Organization officially labeled the novel coronavirus (COVID-19) a pandemic. As a result, travel bans, stimulus packages, and emergency monetary policy measures were implemented. Subsequently, extreme volatility has become a new staple of the world’s capital markets.
To learn more about how you can use futures to secure market share amid COVID-19 mania, schedule your free consultation with a market pro at Daniels Trading today.
About Daniels Trading
Daniels Trading is an independent futures brokerage firm located in the heart of Chicago’s financial district. Established by renowned commodity trader Andy Daniels in 1995, Daniels Trading is built on a culture of trust committed to the firm’s mission of Independence, Objectivity and Reliability.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
Day Trading in Russia 2020 – How To Start
DayTrading.com is the top international guide to online day trading in 2020. Beginners who are learning how to day trade should read our many tutorials and watch how-to videos to get practical tips for online trading. Experienced intraday traders can explore more advanced topics such as automated trading and how to make a living on the financial markets.
Trade Forex with top rated broker Pepperstone, which has been selected based on its high rating and your location.
Why Forex? Forex is the biggest trading market in the world and also the most commonly used by new traders. You can trade 24 hours a day, 6 days a week, which makes it ideal for trading from home even if you have a daytime job.
If you accept more risk, products like binary options and CFDs can return close to 100% on a single successful trade with top broker Binary.com. These products can be used on the forex markets for 24/6 access and results are achieved in minutes rather than hours.
Top 3 Brokers in Russia
When you want to trade, you use a broker who will execute the trade on the market. The broker you choose is an important investment decision. Below are some points to look at when picking one:
- Speed of execution – Due to the high number of trades you might make in a day, speed of execution is important – as is getting the price you need, when you need it.
- Costs – The lower the fees and commission rates, the more viable day trading is. Active traders will be trading often – minimising these trading costs it vital
- Regulatory compliance – Make sure your broker is regulated. They will be legally obliged to protect your financial interests.
- Support – Whatever your day trading strategy, you’ll probably need assistance at some point, so look for online brokers with quick response times and strong customer support.
- Spreads, Leverage & Margin – As a day trader you want competitive spreads – you might also want certain leverage levels and low margins.
- Trading Platforms – Does it suit your needs? From a stop loss to a limit order and advanced charting, the trading platform needs to deliver the tools and features you want.
- Assets and Markets – A forex trader wants to trade different assets than someone stock trading. Brokers cater for different markets so you need to know you can trade the correct currency pairs or stocks and equities.
Do your research and read our online broker reviews first. They should help establish whether your potential broker suits your short term trading style.
Hyperinflation refers to a situation in which goods and services inflation is very high and typically increasing in a non-linear way. The real value of the currency declines. People who earn their money in that currency are increasingly incentivized to convert their holding of said currency into more stable stores of wealth. This includes more […]
As we start the new quarter with the overriding question of whether the risk rally has legs, or is this the time to review renewed bearish exposure – here are a few charts that are on my radar: S&P500 daily % ranges – We closed the S&P500 cash session -1.6%, with the index tracking a 2.7% […]
Alpari deliver CFD and forex trading across a range of markets. Here, they explain how to trade commodities using a range of investment vehicles on their platform. What Are Commodities? Commodities are natural resources or foods, often the raw materials for manufacturing. Cotton, wheat, soybeans, cattle, lumber, natural gas, coffee, rice and sugar are just […]
What Is Day Trading?
The definition of “day trading” is the buying and selling of a security in a single trading day. If you’re day trading online you will close out your position before the markets close for the day to secure your profits. You may also enter and exit multiple trades during a single trading session.
Brokers on occasion have different definitions for ‘active’ or day traders. Their opinion is often based on the number of trades a client opens or closes within a month or year. Some brands even refer to ‘hyper-active traders’ – a step beyond the ‘active trader’.
Day trading is normally done by using trading strategies to capitalise on small price movements in high-liquidity stocks or currencies. The purpose of DayTrading.com is to give you an overview of day trading basics and what it takes for you to make it as a day trader. From scalping a few pips profit in minutes on a forex trade, to trading news events on stocks or indices – we explain how.
What Can Be Traded?
The most lucrative and popular day trading markets today are:
- Forex – The foreign exchange currency market is the world’s most popular and liquid.
The sheer volume of forex trading makes it attractive for day traders. There are multiple short-term opportunities in a trending currency pair, and an unrivalled level of liquidity to ensure opening and closing trades is quick and slick. More suited to technical analysis, there are other ways to trade foreign exchange. In addition, forex has no central market. This means traders can make trades six days a week, 24 hours a day. They present a great starting point for entry level or aspiring traders with full time jobs. Traders in Australia might be specifically interested in trading the AUD USD pair.
- Stocks – Physical stocks in individual companies, regular and Leveraged ETFs (an “Exchange Traded Fund” holds multiple stocks or commodities and is traded like a single stock), futures, and stock options.
Trading stocks intraday offers different opportunities than a traditional ‘buy and hold’ strategy. Speculating on stock prices via CFDs or spread betting for example, mean traders can profit from falling prices too. Margin or leverage also reduce the capital required to open a position. So you can take a position on the latest news release, product announcement or financial report – as well as technical indicators.
- Cryptocurrencies – The two most popular currently are Bitcoin and Ethereum.
The financial vehicle of the moment. Spectacular growth has seen cryptos attract many new investors. Brokers are also ensuring retail access to these markets is less complicated. Taking a view on any of these new blockchain based currencies is being simplified all the time. Barriers to entry are now almost nil, so whether you are a bull or a bear, now is the time.
- Binary Options – The simplest and most predictable method, as the timing and return on a successful trade are known in advance.
Regulatory changes are pending, and with the sector maturing, these products are now offered by big established brands. The only question for you is – will the asset rise in value, or not? With the downside limited to the size of the trade, and the potential payout known in advanced, understanding binaries is not difficult. They offer a different method of trading, and can play a part in any day trader’s daily portfolio.
- Futures – The future price of a commodity or security.
- Commodities – Oil and natural gas, food stuffs, metals and minerals
If you’re S&P 500 day trading, you’ll be buying and selling the shares of companies, such as Starbucks and Adobe. In the day trading forex market, you’ll be trading currencies, such as the Euro, U.S dollar and GBP. In the futures market, often based on commodities and indexes, you can trade anything from gold to cocoa.
Index funds frequently occur in financial advice these days, but are slow financial vehicles that make them unsuitable for daily trades. They have, however, been shown to be great for long-term investing plans.
Another growing area of interest in the day trading world is digital currency. Day trading with Bitcoin, LiteCoin, Ethereum and other altcoins currencies is an expanding business. With lots of volatility, potential eye-popping returns and an unpredictable future, day trading in cryptocurrency could be an exciting avenue to pursue.
Recent reports show a surge in the number of day trading beginners. But unlike the short term trading of the past, today’s traders are smarter and better informed, in part due to trader academies, courses, and resources, including trading apps.
Daytrading.com exists to help novice traders get educated and avoid mistakes while learning how to trade intraday.
Day trading 101 – get to grips with trading stocks or forex live using a demo account first, they will give you invaluable trading tips, and you can learn how to trade without risking real capital.
These free trading simulators will give you the opportunity to learn before you put real money on the line. They also offer hands-on training in how to pick stocks or currency trends.
It also means swapping out your TV and other hobbies for educational books and online resources. Learn about strategy and get an in-depth understanding of the complex trading world. DayTrading.com is the ideal beginners guide to day trading online.
Books for Beginners
- ‘Day trading and swing trading the currency market’, Kathy Lein
- ‘Day Trading for Dummies’, Ann Logue
Both books will provide you with the basic day trading rules to live by. You’ll also benefit from advice on stock picks, plus creative strategy ideas. As Benjamin Franklin highlighted, ‘an investment in knowledge pays the best interest’.
While the ‘for dummies’ series of books are very accessible, it will be helpful to broaden the depth of trading literature you try – More on day trading books
Patterns And Technical Analysis
Day trading chart patterns paint a clear picture of trading activity which helps you to decipher individuals’ motivations. They could highlight s&p day trading signals for example, such as volatility, which may help you predict future price movements.
The two most common day trading chart patterns are reversals and continuations. Whilst the former indicates a trend will reverse once completed, the latter suggests the trend will continue to rise. Understanding these trading patterns, as well as ‘triangles’, ‘head and shoulders’, ‘cup and handle’, ‘wedges’ and plenty more, will all make you better informed when it comes to employing your trading strategies.
Day Trading Strategies
Head over to websites like Reddit and you’ll see many trading dummies who will often fall at the strategy hurdle, taking the first momentum examples they see and losing money left, right and center. Savvy traders will employ day trading strategies in forex, grain futures and anything else they’re trading in, to give them an edge over the market. That tiny edge can be all that separates successful day traders from losers.
There are a number of day trading techniques and strategies out there, but all will rely on accurate data, carefully laid out in charts and spreadsheets. Options include:
- Swing trading
- Trading zones
- Trading on volume
- Arbitrage trading
- A simple day trading exit strategy
- Utilising news
It is those who stick religiously to their short term trading strategies, rules and parameters that yield the best results. Too many minor losses add up over time.
Part of your day trading setup will involve choosing a trading account. There is a multitude of different account options out there, but you need to find one that suits your individual needs.
- Cash account – Day trading with a cash account (also known as without margin), will allow you to only trade the capital you have in your account. This limits your potential profits, but it also prevents you losing more than you can afford.
- Margin account – This type account allows you to borrow money from your broker. This will enable you to bolster your potential profits, but also comes with the risk of greater losses and rules to follow. If you want to start day trading with no minimum this isn’t the option for you. Most brokerage firms will insist you lay down a minimum investment before you can start trading on margin. You can also experience a margin call, where your broker demands a greater deposit to cover potential losses.
The brokers list has more detailed information on account options, such as day trading cash and margin accounts. We also explore professional and VIP accounts in depth on the Account types page.
Learn the trading lingo and vocabulary and you’ll unlock the door to a whole host of trading secrets. Below we have collated the essential basic jargon, to create an easy to understand day trading glossary.
- Leverage rate – This is the rate your broker will multiply your deposit by, giving you buying power.
- Automated trading – Automated trading systems are programs that will automatically enter and exit trades based on a pre-programmed set of rules and criteria. They are also known as algorithmic trading systems, trading robots, or just bots.
- Initial Public Offering (IPO) – This is when a company sells a fixed number of shares to the market to raise capital.
- Float – This is how many shares are available to trade. If a company releases 10,000 shares in the initial IPO, the float would be 10,000.
- Beta – This numeric value measures the fluctuation of a stock against changes in the market.
- Penny Stocks – These are any stocks trading below $5 a share.
- Profit/Loss ratio – Based on a percentage basis, this is the measure of a system’s ability to generate profit instead of loss.
- Entry points – This is the price at which you buy and enter your position.
- Exit points – This is the price at which you sell and exit your position.
- Bull/Bullish – If you take a bullish position day trading you expect the stock to go up.
- Bear/Bearish – If you take a bearish position you expect the stock to go down.
- Market trends – This is the general direction a security is heading over a given time frame.
- Hotkeys – These pre-programmed keys allow you to enter and exit trades rapidly, making them ideal if you need to exit a losing position as soon as possible.
Charts, Graphs, Patterns & Strategy
- Support level – This is the price level where the demand is strong enough that it prevents the decline in price past it.
- Resistance level – This is the price level where the demand is strong enough that selling the security will eradicate the increase in price.
- Moving Averages – They provide you with vital buy and sell signals. Whilst they won’t tell you in advance if a change is imminent, they will confirm if an existing trend is still in motion. Use them correctly and you can tap into a potentially profitable trend.
- Relative Strength Index (RSI) – Used to compare gains and losses over a specific period, it will measure the speed and change of the price movements of a security. In other words, it gives an evaluation of the strength of a security’s recent price performance. Day trading tip – this index will help you identify oversold and overbought conditions in the trading of an asset, enabling you to steer clear of potential pitfalls.
- Moving Average Convergence Divergence (MACD) – This technical indicator calculates the difference between an instruments two exponential moving averages. Using MACD can offer you straightforward buy and sell trading signals, making it popular amongst beginners.
- Bollinger Bands – They measure the ‘high’ and ‘low’ of a price in relation to previous trades. They can help with pattern recognition and enable you to arrive at systematic trading decisions.
- Vix – This ticker symbol for the Chicago Board Options Exchange (CBOE), shows the expected volatility over the next 30 days.
- Stochastics – Stochastic is the point of the current price in relation to a price range over time. The method aims to predict when prices are going to turn by comparing the closing price of a security to its price range.
If you stumble across a word or phrase that leaves you scratching your head, refer back to this day trading dictionary and chances are you’ll get a quick and easy explanation.
Read the glossary for definitions of many more words and concepts.
Day Trading vs The Alternatives
Yes, you have day trading, but with options like swing trading, traditional investing and automation – how do you know which one to use?
- Swing trading – Swing traders usually make their play over several days or even weeks, which makes it different to day trading. It can still be a good method for the trader who wants to diversify.
- Traditional investing – Traditional investing is a longer game and looks to put money in popular assets such as stocks, bonds, and real estate for long-term value appreciation. Realistic investment returns over a whole year are in the 5-7% range. Unless you are already rich and can invest millions, traditional investing returns too little to make much of a difference on a daily basis. However, the intelligent trader will also invest long-term.
- Robo-advisors – An increasing number of people are turning to robo-advisors. You simply chose an investing profile, then punch in your degree of risk and time frame for investing. Then an algorithm will do all the heavy lifting. This is normally a long-term investing plan and too slow for daily use.
Day trading vs long-term investing are two very different games. They require totally different strategies and mindsets. Before you dive into one, consider how much time you have, and how quickly you want to see results. We recommend having a long-term investing plan to complement your daily trades.
Day Trading For a Living
So you want to work full time from home and have an independent trading lifestyle? If so, you should know that turning part time trading into a profitable job with a liveable salary requires specialist tools and equipment to give you the necessary edge. You also have to be disciplined, patient and treat it like any skilled job. Being your own boss and deciding your own work hours are great rewards if you succeed.
Whilst it may come with a hefty price tag, day traders who rely on technical indicators will rely more on software than on news. Whether you use Windows or Mac, the right trading software will have:
- Automatic Pattern Recognition – Identifies flags, channels, and other indicative patterns,
- Genetic and Neural Applications – Profit from neural networks and genetic algorithms to better predict future price movements.
- Broker integration – With direct links to brokerages, you can automatically execute trades, removing emotional distractions and streamlining the execution process.
- Backtesting – Applies strategies to previous trades to demonstrate how they would have performed. This enables traders to better understand how particular trading methods may perform in the future.
- Multiple news sources – Online newsfeeds and radio news alerts play an integral part in day trading. As Kofi Annan rightly asserted in one of the most prudent trading quotes, ‘knowledge is power’. The more you know, the quicker you can react, and the quicker you can react, the more day trading profits you might make.
If you’re trading as a career you have to master your emotions. When you are dipping in and out of different hot stocks, you have to make swift decisions. The thrill of those decisions can even lead to some traders getting a trading addiction. To prevent that and to make smart decisions, follow these well-known day trading rules:
- Controlling fear – Even the supposedly best stocks can start plummeting. Fear then sets in and many investors liquidate their holdings. Now whilst they prevent losses, they also wave goodbye to potential gains. Recognising that fear is a natural reaction will allow you to maintain focus and react rationally.
- ‘Pigs get slaughtered’ – When you’re in a winning position, knowing when to get out before you get whipsawed or blown out of your position isn’t easy. Tackling your own greed is a hurdle, but one you must overcome.
Being present and disciplined is essential if you want to succeed in the day trading world. Recognising your own psychological pitfalls and separating your emotions is imperative.
DayTrading.com exists because we could not find a reliable day trading school, university, academy, or institute that runs classes where you can get an all-inclusive day trading education. This site should be your main guide when learning how to day trade, but of course there are other resources out there to complement the material:
- Online day trading courses
- Practice game apps
- Message boards like Discord
- Chat rooms (always free)
- Pdf guides
For the right amount of money, you could even get your very own day trading mentor, who will be there to coach you every step of the way. Opt for the learning tools that best suit your individual needs, and remember, knowledge is power. The ‘Day Trading For Dummies‘ books are not your only option!
7 Secrets To Success
Whether you’re looking for jobs you can do from home, or you want to start day trading as a hobby, follow these seven essentials.
1. Setting up
The better start you give yourself, the better the chances of early success. That means when you’re sat at your desk, staring at your monitors with hands dancing across your keyboard, you’re looking at the best sources of information. That means having the best trading platform for your Mac or PC laptop/desktop, having a fast and reliable asset scanner and live stream, and software that won’t crash at a pivotal moment.
2. Keep it simple
This is especially important at the beginning. You might be interested in s&p 500, mutual funds, bond futures, Nasdaq, Nasdaq futures, blue-chip stocks, equities, or the Dax 30, but to start with focus on only one. Get good at making money from one market/security before you branch out. The other markets will wait for you.
3. Be realistic
The movies may have made it look easy, but don’t be fooled. Even the day trading gurus in college put in the hours. You won’t be invited to join that hedge fund after reading just one Bitcoin guide. You need to order those trading books from Amazon, download that spy pdf guide, and learn how it all works.
4. Risk management
This is one of the most important lessons you can learn. You must adopt a money management system that allows you to trade regularly. Is day trading really worth it if you’ll be broke by the end of the first month?
History has shown that many successful traders never risk more than 1% of their account balance on a single trade. So, if you had $25000 in your account, you’d only risk $250 on a single trade. Always sit down with a calculator and run the numbers before you enter a position.
5. Keep a record
One of the day trading fundamentals is to keep a tracking spreadsheet with detailed earnings reports. If you can quickly look back and see where you went wrong, you can identify gaps and address any pitfalls, minimising losses next time.
Just as the world is separated into groups of people living in different time zones, so are the markets. If you start trading on the Cac 40 at 11:00 ET, you might find you’ve missed the best entry signals of the day already, minimising your potential end of day profit. So, if you want to be at the top, you may have to seriously adjust your working hours.
7. Sensible decision making
When you start day trading you’ll have a host of difficult decisions to make. Should you be using Robinhood? What about day trading on Coinbase? Do you have the right desk setup? Where can you find an excel template? How do you set up a watch list? The meaning of all these questions and much more is explained in detail across the comprehensive pages on this website.
You can also find more detailed and comprehensive lessons in our top tips.
The tax situation for day traders is entirely dependent on in which country the trader is “tax resident”. Furthermore, a popular asset such as Bitcoin is so new that tax laws have not yet fully caught up – is it a currency or a commodity?
How you will be taxed can also depend on your individual circumstances. For example, in the UK the HMRC are known to approach day trading activities from 3 different angles:
- Speculative/similar to gambling activities – Day trading profits would likely be totally free from income tax, business tax, and capital gains tax.
- Substantial self-employed trading activity – Likely to be subject to business tax.
- Significant activities of a private investor – Gains and losses would fall under the remit of the capital gains tax regime. Paying just business tax would be highly illegal and open you up to serious financial penalties.
Due to the fluctuations in day trading activity, you could fall into any three categories over the course of a couple of years. Although you don’t need a license, it’s important you rigorously monitor your trades, seek tax advice, and stay within laws and regulations when filing your tax returns.
Read the Guide to Day Trading Taxes for more comprehensive information on tax rules and reporting.
How Much Money Will You Make?
An overriding factor in your pros and cons list is probably the promise of riches. We’ve all heard stories of day trading millionaires who started trading with just 1000 dollars, but soon hit the jackpot and mastered the markets. Whilst, of course, they do exist, the reality is, earnings can vary hugely.
Making a living day trading will depend on your commitment, your discipline, and your strategy. All of which you can find detailed information on across this website.
The real day trading question then, does it really work? If you’re willing to invest the time and energy, then for you, it could well do.
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