I know how difficult it is for most people to trade relying on the big picture. They are impatient to wait for opportunities and want to have quick profits trading financial markets. On the one hand, it is possible to make a decent living by day trading securities. On the other hand, it is much easier to trade large market trends and do other businesses. Since a lot of people want to make money fast there are a lot of internet scams connected with that and various materials written on the subject that have one single purpose � make money from you. So, be careful and do not be deceived. There is no easy way of making money day trading. However, we can do the job which is very difficult and still make money. Let us look at some of the things that are necessary for successful day trading.
What does a day trader need to be profitable?
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If you want to see and experience what real investing in financial markets such as Forex, stocks and commodities is all about I recommend trying innovative social investment platform of Etoro. Initial deposits are as low as a few hundred bucks. The best dealer I have heard of so far!
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Firstly, it is a deep understanding of the market.
You cannot just read one article on the subject, open an account and start making money within a week. That is a scam! You might be successful in the beginning, but difficult situations will come and you will lose all your deposit. I know what I am talking about, because this happened to me and I saw it happening to hundreds of newbie day traders. Some say that knowing a lot about a market will only confuse you. Do not worry about that. With time you will be able to select what is essential and what is not and take advantage of that knowledge.
Secondly, you will need to have a good trading system or even a few of those.
You should understand what you are doing, when you are entering the market and exiting it. You should wait for specific set ups before you get in. Don�t even try to rely on your feelings. You will fail! Even an average strategy is better than trying to make fast spontaneous decisions by relying on what you see happening in front of your eyes. Be proactive, not reactive!
Thirdly, do not overtrade.
Overtrading is a �disease� of most newbie traders. They are searching for opportunities every hour. And they find them! And they lose money on those, because you cannot catch all the moves in the market. Wait for what you know really works. This may mean that you will make only one or two trades per day, but do not worry about that. Your account balance will definitely be better at the end of the month.
Fourthly, be disciplined.
Stick to what you know works and do not improvise. You do not want to make your trading a dramatic and stressful experience. You want as little stress as possible and discipline will help you to achieve that.
Fifthly, analyze your trades after the day is over.
See your progress. Check if you were able to follow your plan. Try to be as objective and critical towards yourself as possible. If you see a trend of deteriorating from your trading plan and strategy it would be good to stop trading for a few days, re-think your activities and go back to strict discipline.
Sixthly, invest in your financial education.
You need to improve and possibly expand your knowledge so that you can make better day trades and fewer mistakes. It will mean more reading books and articles from people in your field, maybe attending some seminars or workshops. This will probably help you to modify your strategy and make it even better.
Hope the steps were useful.
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Disclaimer
Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog http://trend0.blogspot.com/ is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.
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