How to become a good day trader?

[Volkan Kirkar]

How to become good at day trading?

[Dave Covaci]

Hi Volkan,

In order to start making money, a trader should understand how to make a profit in some detail. First things first, to start making a profit, a trader needs a trading plan.

Once you’ve worked out a decent trading plan, a next logical step would be to test that trading plan in a demo account, where you work with virtual funds and risk no real capital. If the plan doesn’t show results in a demo account, it won’t work in real trading either. If that’s the case, a trader should amend the plan and try it out again in a demo account. Repeat the process until the plan starts showing results. 

When you start real trading, it’s important to have a routine. This involves waking up and start trading at the same time each day as well as keep an eye on important economic news. Following the routine, the trader should also quit trading at the same time every day and make reviews on all trades. A bit of good advice, make a checklist to review your trades and make sure they’re adjusted to your trading plan.

Important news releases are a major factor in day trading. They tend to be highly unpredictable in terms of how they move the market. These news include company earnings reports and scheduled economic data publications. If you’re new to day trading, avoid holding open positions during such releases and enter the market after the news. That way it’s easier to utilize day trading methods and benefit from the market volatility. 

Finally, don’t forget to use stop-loss orders. It’s an efficient method to get you out of market if the asset you’re trading doesn’t move in the direction you’ve anticipated.