1. One must plan a trade and for that one has to select quality stock and has to pre decide the number of shres one is going to trade and has to also pre decide on the entry, exit and stop loss price.
2. Professional day traders make money in first half hour of the opening and last half an hour before closing of the market, however risk is higher due to volatility but rewards are equally tempting.
3. Always stop loss be placed and a strategy is to set stop loss sell order just below the low of the day or support level and stop loss buy order just above the high of the day or Resistance level.
4. Only trade in that many stocks which one can handle at any given time without referring to notebook. Preferably 3-5 shares only.
5. Day trading be in such stocks which have high volume and is incorporated in index.
6. Remember one is not an expert to be able to always sell at top and buy at lower levels.
7. As a thumb rule always buy on the right side of 'V' i.e. buy a stock which is going Up. Generally buying level is just above the previous closing price.
8. Sell the stock that is going down and that may be undertaken when the selling level is just below the previous closing price i.e. on the left side of the 'V'.
9. Loss making position may never be averaged.
10. Greed will steal your all profit, so guard against it. Moreover fear will make you book miniscule profits or will not let you enter a quality trade set up.
11. If profit is available on the table, than book profit and leave thwe trading screen for the day and enjoy for the rest of the day.
12. Stock market opens its door to riches every day and thus forget losses quickly and Wait for next Opportunity.
13. Always maintain a diary here trades records coupled with mistakes may be recorded and ofcourse do not forget to analyse the trading results.
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20 Jun 2008
13 day trading tips which can make one a successful day trader
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