how to succeed with day trading

It is agreed that investing real money in the stock market is a risky business. There are a number of different strategies for trading online. The day trading may seem a priori a good approach, which provides regular financial markets. What is it really? Is it a real winning strategy or should it be approached with suspicion? Reserved for the stock and forex market? Our guide to day trading for dummies gives a complete overview of this concept with enormous but risky potential. Learn to surf the right trend every day.

Day trading definition


The day trading strategy is a practice, resulting from American traders, which is taking more and more root in France. Its basic concept is simple: a day trader is an investor who logs in several times a day on his portfolio of assets, to open positions taking advantage of each price trend (up or down) and close each order before the markets close. This allows him in particular to keep a liquid portfolio, that is to say free of overnight or overnight fees. Day trading can be a one-time investment plan.

The technical day trading aims to make the most of the volatility of the stock market by making small gains with the mechanism leverage. To guarantee his profitability, a day trader multiplies the number of transactions (or trade). Experts often admit that day trading favours reasonable gains of between 0.5% and a few percent on each position.

A day trader makes more than ten transactions per day, regardless of the financial market. We speak, for example, of crypto currency day trading (or even Bitcoin day trading) or forex day trading.

Behind its very simple concept, it seems important to us, in our opinion, to point out that the day trading strategy is far from being the one that offers the best risk management. Each trade is important to meet the objectives of the overall strategic plan. Taking a day trading training is essential to minimise capital losses (after a real money deposit on a platform) and optimise profitability.

67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you can afford to take the high risk of losing your money.

How to get started in day trading?


Learn day trading techniques and strategies

Beginner traders, who wish to move towards this investment strategy, should therefore take training in day trading and offer themselves the best possible chance of taking advantage of the various financial instruments available from their broker. It is therefore essential to learn plural techniques and strategies. A profitable day trader is an investor who aims for maximum profitability.

The day trading is to be associated with scalping, based on this mechanism. In other words, its objective is to achieve the most winning trades in a stock market trading day. We also speak of intraday trading, since no order is carried over to the next session.

Since all of his positions must be closed before the end of the day, he does not shrink from a few reasonable losses on his session. For example, in day trading, a trader does not agree to lose more than 10% on his position. In the event of a risky situation, he closes the position concerned. We often speak of profitable traders when the threshold of winning positions equals or even exceeds 50%.

A beginner has a lot of technical and practical training to do in order to hope to increase his earnings on each order. Opening a demo account with a CFD broker is a first step. This is the opportunity to understand and apply real-world chart learning, fundamental and technical analysis, trading signals and financial indicators. Understand and follow the price trend in the right direction as often as possible.


Start by specialising in a market


Opinions converge on this point in all day trading training. It is imperative to specialise in an intraday market. Firstly, because not all instruments are so volatile and the signals cannot be deciphered unanimously. Second, not all markets are suitable for day trading.

Where trading in currency pairs (forex) or CFDs (on stocks or indices for example) is perfectly suited to seeking profit on small variations in price, it is more difficult to become profitable on the market for conventional shares much less liquid. Cryptocurrency day trading is possible since Bitcoin, for example, can change significantly in the same day.

Finding the right broker for day trading


The choice of broker is essential. It is the platform where the day trader will spend his time to earn money. Special attention must be paid to the amounts of brokerage fees. The spreads applied to the positions can represent a significant weight on a large volume of transactions.

The price list may also include commissions on certain families of instruments, or even on certain transactions. The equity market is often the most impacted. Finally, the catalog of financial products must be sufficiently extensive to offer a possibility of diversification, while facilitating the use of a day trading strategy.

The juiciest market in day trading? To analyse


Forex Day Trading


Perhaps forex day trading is the idea that has the most favourable reviews. It is a very liquid market, with a large selection of currency pairs. Let us add that the forex market adapts very well to an intraday investment strategy, avoiding rollover (or overnight) fees. It is a first choice, especially in day trading for dummies, especially for scalping.


Day Trading Cryptocurrencies

The cryptocurrency market is becoming a strong pillar of online trading platforms. Especially with the development of derivative products (CFDs) on this type of asset. On the upside or downside, it is possible to make good profits on micro transactions using cryptocurrency day trading. Bitcoin is a telling example since it is traded in high volume, 24/7 between investors around the world.


Day Trading Actions


The Stocks Market is a pledge of confidence for novice day traders. Indeed, the opportunities are numerous and the market very liquid. It is good to note that the presence of CFDs on shares with many brokers helps to further promote such an investment strategy. It is also essential to be careful to close all your positions in equities to avoid price gaps overnight.


Day Trading Futures


Day trading in futures is a bit special. Trading futures means that a trader signs a futures contract that provides for a defined amount of an underlying asset and a time expiration in a specific market for that type of product. This represents a greater risk since the conditions of position management are no longer so free.

Despite everything, with a good technical analysis upstream, profitable positioning can be beneficial for brokers who offer this type of asset. Demand is high, which guarantees high liquidity and high volatility for daily gains.

67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you can afford to take the high risk of losing your money.

Our tips for getting started in day trading

Many traders are still hesitating between doing day-trading and betting on long-term investments. This day-to-day trading method has different advantages, but also comes with some disadvantages. To help you make the right decision, here are the pros and cons of these quick back-and-forths:

The advantages of day trading


Quick speculations by day traders can be interesting for several reasons:

  • The opportunities are to be seized on a daily basis, which gives the trader the possibility of pocketing gains every day. While for long term speculation, it sometimes takes a long time to get a good investment opportunity;

  • As the trading time is very short, around 10 minutes per day, there is less risk of unexpected changes in the market;

  • During the night, it is possible to take little or no margin, given the risks practically non-existent;

  • Several trading techniques can be applied including swing trading and high probability entry systems which are very effective;

  • With a good trading strategy, it is perfectly possible not to make a loss for weeks;

  • The withdrawals of earnings are fast;

  • Day trading is psychologically very stimulating.

The disadvantages of day trading


Very short-term investments, however, have some negative points that should not be overlooked:

  • The amounts of the winnings are often limited. To make tangible profits, it is generally necessary to ensure a reliability of more than 50%;

  • Transaction costs are much higher when the stakes are low. They can consume a large part of the profits and sometimes they constitute up to 20% of the initial capital;

  • Market shifts can cause significant losses;

  • The day trader can lose much more than he wins, especially with many high probability entries;

  • It is necessary to follow the prices in real time on a daily basis, for example via a trading application. Research costs are therefore significant and, as a bonus, you have to be more available to manage trades;

  • The psychological stimulation of day-trading is just an illusion. It does not save money, but on the contrary, the pressures can cause unnecessary precipitation in the trader.

67% of retail investor accounts lose money when trading CFDs with this provider. You have to ask yourself if you can afford to take the high risk of losing your money.

In any case, it should be noted that the choice of becoming a day-trader or a long-term investor depends on other points. In order to put the odds on his side, it is essential to establish strategies adapted to his objectives.