Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - 30th Nov 21
Omicron Covid Wave 4 Impact on Financial Markets - 30th Nov 21
Can You Hear It? That’s the Crowd Booing Gold’s Downturn - 30th Nov 21
Economic and Market Impacts of Omicron Strain Covid 4th Wave - 30th Nov 21
Stock Market Historical Trends Suggest A Strengthening Bullish Trend In December - 30th Nov 21
Crypto Market Analysis: What Trading Will Look Like in 2022 for Novice and Veteran Traders? - 30th Nov 21
Best Stocks for Investing to Profit form the Metaverse and Get Rich - 29th Nov 21
Should You Invest In Real Estate In 2021? - 29th Nov 21
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Top Strategies Day Traders Adopt

InvestorEducation / Learn to Trade Oct 14, 2020 - 12:08 PM GMT

By: Submissions


Day trading is an act where you buy and sell financial instruments on the same day. You can also decide to trade multiple times during the course of the day. In the day trading, investors take advantage of the small prices, and results can be lucrative after playing correctly. However, this is a dangerous game, especially for those who are not familiar or inexperienced investors. It is a threat to an investor who utilizes it without having a well-thought strategy.

Day trading does not suit all brokers. But some brokers are designed to have day trade in their mind such as that accommodates investors who want to day trade.

When choosing an online broker, get those having professional and advanced versions in their platforms. Such features advanced charting tools, real-time streaming quotes, and the ability to enter or modifying complex orders.

Below, let's look at some strategies adopted in day trading.

  • Reversal

Reversal is a hotly debated strategy but dangerous to be used by a beginner. However, it is a recommend day trading strategy being used across the world. Reversal trading refers to trend trading, reversion strategy, and pull back trending.

Reversal strategy tries to defy the basic logic because your aim is trading against the trend. Therefore, you should accurately identify possible pullback as you try to predict your strength. However, to succeed with this strategy, you should have in-depth market skills and experience.

  • Breakout

This is a popular type of day trading many investors are adopting. It centers around the moment the price will clear to a specific level in the chart after an increased volume. Here, the breakout trader requires to enter into a long position the moment the security or asset will break above resistance.

On the other hand, you have to enter into a short position the moment the stock will break below support. When a security or asset trades above a certain price barrier, prices tend to trend towards the breakout direction while volatility continues to increase.

The best way for this strategy to work perfectly is to locate the correct instrument to trade. If you have to do this, always remember resistance levels and asset support. The more the prices will hit these points frequently, the more critical and validated they will become.

Entry Points

It is a nice and straightforward part. When the prices set are about to close, but above resistance levels, they will need a bearish position. When the prices are set and ready to close, but below a support level, they will need a bullish position.

Planning Exits

The recent asset performance should establish a reasonable price target. Therefore, with the help of chart patterns, you can make the process accurate. You need to get the average of the recent price swings to be able to create a target.

In case the average price swing is 3 points over previous price swings, it can be a sensible target for you. After reaching that goal, it will be the right moment for you to exit trading and have time to enjoy your earnings.

  • Using Pivot Points

The pivot point is a fantastic day trading strategy where you have to identify and act on critical support and resistance level. This strategy works perfectly in the forex market. Moreover, it is a suitable strategy for range-bound traders who aims at identifying entry points. Breakout and trend traders use this strategy when they want to local critical levels they need to breakout.

  • Momentum

Momentum is a day trading strategy suitable for beginners. It revolves around acting on identifying substantial trending moves from news sources by supporting high volume. In the trade, there will be one stock that will move approximately 20 percent to 30 percent each day, giving you an ample opportunity. Therefore, you have to hold your position up to the moment you can see reversal signs to get out.

The other alternative is where you fade the price drop. With this method, you have to round your price target the moment the volume starts diminishing.

It is, therefore, a simple but effective strategy when adequately utilized. But, you should be cautious about the upcoming news of earning announcements. Within a few seconds of each trade, it can bring differences at the end of the day's profits.

  • Scalping

 Scalping is a popular day trade strategy. Mostly, this strategy works best in the forex market, where it aims at capitalizing on minute changes in prices. Here, the driving force is usually the quantity. You aim at selling the moment trade will become profitable.

However, scalping is an exciting and fast-paced way of trading. The downside of this strategy is that it is much riskier. However, to consider this strategy, you should have a high trading probability that will help you out with the risk vs. reward ratio.

You have to be keen on volatile instruments, be ready for timing, and check attractive liquidity. Don't wait for the market, but you have to close your losing trades as earlier as possible.

Learning Methods

Blogs: Online blogs are among the places you can get the best strategies for day trading.

Videos: There are different ways to learn day trading strategies. Some find videos being useful.

Forum: Forum is also a perfect place for people to gather knowledge on day trading. That is through commenting and asking questions. Besides, you'll get some easy methods for everyone to use.  

The Final Verdict  

The profits you get will hugely depend on the skills and strategies you employ. Therefore, you have to keep in mind that you need a straightforward strategy that will give you success, either interested in NSE or gold.

Another thing to consider is technical analysis. You have to admit it because it plays a vital role in validating your strategy. Besides, when you choose an earlier entry or even at the end of day trading strategies, you have to control your risks. Lastly, what is essential is to develop an effective plan and be patient.

By Mark Adan

At, we specialise in content-led Online Marketing Strategies for our clients in the Marketing, Finance, Business industry and other sectors. With our professional writing team and our superb content creation programmes we achieve great marketing successes for our clients.

Copyright 2020 © Mark Adan - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in