7 Day Trading Tips for Beginners for Success

When you think about day trading, this activity is a bit different from trading that happens overnight or for long periods of time. Opportunities to buy and sell are only going to be available for a short period of time during the day. This is because sellers want to reduce the risk that they are taking when overnight events could drastically change the price of their stock. However, this kind of trading used to have a pretty bad reputation as many beginners had no idea what they were doing and could not trade properly.

That’s why it’s the best idea for you to come in prepared if you are looking at stepping your feet into the day trading world. Without having the necessary preparation, you are putting yourself at risk of losing a lot of money or getting super frustrated when you don’t find success. Be sure to keep reading down below, where we’re going to give you the top tips you need to know in order to be successful in the big, wide world of day trading.

1. Think About the Imbalance in Supply and Demand

When you are looking at stock to buy into or sell, one of the first principles that you have got to memorize is the principle of supply and demand. As with most things in life, supply and demand is what rules every single market in the world. This means that when supply is high, but there are not that many customers looking to buy, then then the price will go down. If the supply is low and there are plenty of customers out there looking to buy, then the prices will soar into the heavens.

When looking for trading opportunities, use this principle as your guiding compass. You will be able to find the best deals when you figure out where the prices are lowest and how you can take advantage of that. When there’s not that much demand for something that has a lot of supply, you can often get a pretty good bargain that you wouldn’t get otherwise.

2. Be Sure to Set Up Price Points Before You Start

The next thing that you’re going to have to do if you want to find success in day trading is to determine what your price points are. Even before that if you do some research on why most day traders lose money, it would do you no harm! These are the points by which you set whether you will pull out with enough profit to make you happy or pull out when the market isn’t going to so well and you don’t want to lose any more money. These points are super important for you to get down before you start trading. If you don’t, then you could end up being a little bit too greedy when the market seems good and the next thing you know, you have lost all of your money. Day trading is a tumultuous business, so there are no guarantees that profit will come your way.

3. Always Set a Risk to Reward Ratio

You should be setting your risk to reward ratio at around 3:1 if you want to stay safe and win big at day trading. Risk-reward ratios are basically your avenue to keeping the risk low to get the most reward that you can. Even if you have losses on your trades, this is a way that you can find success. Make sure to do some research on these ratios and get some more information on the right ratio for you to set before you go forward into the day trading world.

4. Patience Is Definitely a Virtue

The next biggest tip that we have for you to follow is that patience is definitely a virtue and you need to have that patience to be successful. It might come as a surprise to you that most day traders don’t trade during every day. A lot of the time, they are just staring at their smartphone or computer screen, trying to find the best possible trades for them to get into. This patience is crucial if you want to find good deals and not waste your time on trades that aren’t going to get you anywhere.

Being prepared before you step into this one-day bulls and bears business also requires you to learn the steps to day trading success like Bible, else, lack of knowledge might leave you, dejected and worse, at loss!

5. Discipline Yourself to Be Successful

When it comes to building up a trading plan, you have got to learn how to master self-discipline to stick with it and not let your emotions get into the way. One of the worst enemies that you have in this game is your emotions that can get in front of you. For example, impulse behavior is one of the worst things that can happen to you. You can get greedy and wait for a trade to make you even more money, even when you know you should probably pull out. You could get scared and not even trade anything because you don’t want to lose any money.

No matter what, before you get started, make sure that you find that inner discipline to keep those emotions in check and make the best and most logical decisions that you can.

6. Don’t Be Afraid To “Order”

The next thing that we have to say to you is that you shouldn’t be afraid to press that “order” button. Sure, you should make sure that this is a logical trade for you to get into before you press it, but once you know that it is, then don’t worry! You should not face paralysis and not be able to start trading. If you do, then you’re never going to make it in this industry.

7. Never Trade with Money That You Can’t Afford to Lose

Stock trading in the age of millennials might sound cool but it might lead you to end up in difficult situations. You never want to trade with money that you can’t afford to lose. When you’re a day trader, you should have two buckets of funds. One is going to be for that money that you’re saving for retirement or that you need to pay off your mortgage. The other is going to be money that you can afford to put off into day trading – which is going to be the smaller bucket. When you do this, you can ensure your financial security and make sure you’re not putting your future self in trouble.

When you’re getting into the day trading world, this can be a scary step for you. It’s a whole new world out there, but when you have the above tips in your back pocket, and an active sense of humor, you should be prepared to find success.