What is Day Trading?
  • Day Trading involves taking a position in the markets with a view of squaring that position before the end of that day.
  • A day trader typically trades several times a day looking for fractions of a point to a few points per trade, but who close out all their positions by day's end.
  • The goal of a day trader is to capitalize on price movement within one trading day.
  • Unlike investors, a day trader may hold positions for only a few seconds or minutes, and never overnight.

What day trading really means.

The term "day trading" is a widely misused and misunderstood term. Real day trading means not holding on to your stock positions beyond the current trading day; in other words, not holding any position overnight. This is really the safest way to do day trading because you are not exposed to the potential losses that can occur when the stock market is closed due to news that can affect the prices of your stocks.

Unfortunately, many people who claim to be "day trading," hold stocks overnight because of fear or greed, thus setting themselves up for the catastrophic elimination of their capital. When day trading currencies, the term "day trading" changes slightly. Since currencies can be traded 24-hours-a-day, there is no such thing as "overnight" trading. Thus, you can have open positions for longer than a day with active stop losses that can be activated at any time.

Day trading can be further subdivided into a number of styles, including:

  • Scalpers: This style of day trading involves the rapid and repeated buying and selling of a large volume of stocks within seconds or minutes. The objective is to earn a small per share profit on each transaction while minimizing the risk.
  • Momentum Traders: This style of day trading involves identifying and trading stocks that are in a moving pattern during the day, in an attempt to buy such stocks at bottoms and sell at tops.

Advantages of Day Trading

  • Zero Overnight Risk: Since positions are closed prior to the end of the trading day, news and events that affect the next trading day's opening prices do not effect your portfolio.
  • Increased Leverage: Day Traders have a greater leverage on their trading capital because of low margin requirements as their trades that are closed in the same market day. This increased leverage can increase your profits if used wisely.
  • Profit in any market direction: Day trading often will utilize short-selling to take advantage of declining stock prices. The ability to lock in profits even as markets fall throughout the trading day is extremely useful during bear market conditions.

About TradersEdgeIndia.com Day Trading Picks Newsletter

  • Tradersindia.yolasite.com Day Trading Picks Newsletter specializes in finding day trading opportunities for both the scalper and momentum day trader using technical analysis and the Chaos Theory. Our trading system in based on chart formations, technical analysis, chaos algorithms, fractals and volumes....one that has been used to  successfully day trade the Indian stock and derivative markets for years.
  • Only Tradersindia.yolasite.com Day Trading Picks Newsletter can accurately predict the support and resistant zones for the day. This combined with our trend analysis, intra-day volatility and stop loss levels can help any day trader extract maximum profits from the markets with great regularity.
  • Each day we will email you our list of Indian stocks to watch for significant movement in our Day Trading Picks Newsletter. We will supply you with precise support, resistance, entry, exit and stop-loss levels on all stocks.
  • Our picks generally are among the most actively traded stocks. We only recommend stocks that are in a STRONG trend and have what we believe to be sufficient resilience, liquidity and momentum.
  • At Tradersindia.yolasite.com, we work hard to help you preserve your trading capital and avoid many of the pitfalls that most day traders can fall prey to.