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Archives for day trade terminology

Here you will find archived content about day trade terminology found throughout the website.

10 Tips for Day Trading Success: Part 2

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Welcome to DayTradeFeed.com’s 10 Tips for Day Trading Success: Part 2. Make sure you don’t miss out on the tips we discussed In 10 Tips for Day Trading Success: Part 1

Tip #6 Timing is Everything

The majority of orders are made in the market’s first thing in the morning.  This helps contribute to the market’s volatility which Day Traders thrive off of. With practice you may be able to see the market patters and pick the best times to make trades, but for beginners its better to wait a 20 minutes or so before making your first move.
During the middle of the day, the market is more stable, but towards the end of the day there is another volatile period before markets close. The volatility of early morning and late afternoon markets are tempting as they provide more opportunity, but we caution beginners to avoid them until more knowledgeable.

7. Use Limit Orders

Figure out your enter and exit strategies. You may use Market Orders which are fast and reliable, or Limit Orders that will give you more control over the execution price. I
If you choose to use a market order there will be no price guarantee as it is executed at the best price available at the time. Going the route of limit orders, however, will give a guarantee on the price but not necessarily the execution meaning the trade may not go through at all.

8. Patience is a Virtue

Whatever strategies you use, make sure you are patient and consistent. Your strategies may not work every single time but the average will lead to day trading success. It is not uncommon for professional Day Traders to win only 50% or 60% of their trades. Be sure that you are limiting your risk, and your methods very well outlined.

9. Keep your Cool

There will absolutely be times when the stock markets get at your nerves. To see success when day trading you have to trade without emotions. Don’t let things like hope, fear and greed influence your decisions. You will be most profitable in you make moves based on logic.

10. Keep on Keepin on

It is important to move fast if you want to be a Successful day trader. Moving fast, however, does not have to be stressful. You’ve now read the first 9 tips, and you understand what its going to take to be profitable. Get your strategy locked in. Practice patience and discipline. If you do these things, there will be no need for stress and anxiety.
Don’t forget he Day Trader’s mantra: “Plan your trade and trade your plan.”

Day Trading Terminology – Support Levels

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What are Day Trading Support Levels and how do I find them?

To start, let me explain a little bit about what day trading support levels are. Due to a focused cluster of demand, certain price levels stand out because a current downtrend stops for a moment before going through.

For example, say you’re day trading forex and you have a sell trade active. You know there’s a steady downtrend occurring, and you’re simply waiting for your trade to clear before placing another.

All of a sudden, the market downtrend pauses. You assume it’s nothing, but as you go forward you realize the market is having a hard time breaking through that specific price level. Chances are that invisible forcefield is a support level.

How do day traders create strategies around support levels?

Support levels are a common addition to many trading strategies. Most traders treat support levels, along with resistance levels, as if the market will never break through.

By calculating the correct support levels, day traders are able to see into the future of the market. In fact, many traders base their entire trade on simply setting up to take profit prior to reaching specific support levels.

Furthermore, if a day trader knows a support level is located at a certain point, they can take profit on their sell trade and immediately place another trade in the opposite direction.

What is the main takeaway I’ll need while day trading support levels?

In conclusion, understanding support and resistance levels is absolutely necessary if you wish to trade using analytical tools. This is especially true for those who often find themselves in short-term investments, such as day traders.

If you’d like to learn more about how support levels work and how you can implement them in your own personal day trading strategy, contact us using the form below!

    Day Trade Terminology: Volatility

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    Volatility: What is it and how does it affect day trading?

    Volatility = Stability

    Above all, in its most basic definition, volatility can be described as: “liability to change rapidly and unpredictably, especially for the worse.”

    In day trading, it is the measure of a security’s stability. It’s usually calculated by finding the standard deviation of a return that has been compounded over a specific amount of time.

    Define for the Masses

    If you’re not into day trading, the definitions above could be a little tricky to understand. Fortunately, Day Trade FEED appeals to all levels of knowledge surround day trading!

    Basically, volatility is the amount of movement a market sees over a certain amount of time. For instance, if a market has gone up and down more frequently than on average, that market has a high volatility index.

    In contrast, if the market stays relatively consistent and doesn’t see many peaks or valleys, this market would have a low volatility index.

    Low vs High Volatility: What does it mean?

    Because of the nature of the market, certain movements can make or break a day trader’s account. This depends on if they have a short or long position in place.

    When a market has a high volatility index, this means that the market has a high potential for risk. However, it also means that it has a high potential for reward.

    When a market has a low volatility index, this means that the market has a low potential for risk. However, it also means that it has a low potential for reward.

    Should I be scared?

    Absolutely not!

    A lot of market movement means there are a lot of chances to make money. Traders simply need to make sure they know which way the market is trending.

    Also, pay attention to your charting software to ensure you are in and out of trades at the most efficient times possible.

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