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Day Trading is the Perfect Trading Style for the People “In-Between”

Day trading defined

Day trading is one of the many ways you can trade. This trading style is widely used. It is buying and selling financial instruments in one trading day to take advantage of small price movements. Unlike other styles, it is a short-term type since you make one trade per day, and you close it once the day is over. Furthermore, day traders usually pick sides at the day’s start and end the day with a profit or loss.

Day traders do not keep their trades for long. They have enough time to analyze charts, execute, and keep an eye on trades.

Is day trading suitable for your personality and lifestyle?

If you have ample free time and can dedicate your undivided attention to trading just like you would if you have a day job, day trading would be a possible trading style for you. Day trading is for people who are eager to know whether they won or lost. It is also for people who like to start and end their day with a single trade only.

On the other hand, if you are not a fan of short-term trades, you are working a day job that needs your undivided attention, and you do not have the time to keep an eye on what is happening to the markets, then day trading might be the perfect match for you. There are other styles out there for you to check out!

However, suppose you have decided that day trading is for you. In that case, you should always check updates about fundamentals like economic news and press releases to help you pick a bias at the beginning of the day. You will know the direction you want to follow for that specific day.

Different kinds of day trading

Now that we know the meaning of day trading in general, let us peek into a more detailed look and talk about the different types of day trading. These are strategies that one can use simultaneously to earn more profits.

  • Trend trading. This strategy involves looking at the bigger picture. A trader looks for a chart with a longer time frame to understand a trend as a whole. After establishing the overall trend, the trader can now move to a smaller time frame where he can look for opportunities that follow the direction of that established trend. Various indicators can help in timing entries.
  • Countertrend trading. As its name suggests, it’s pretty similar to trend trading. The only difference is the trader will now have to look for opportunities opposite the established trend. Find where the trend ends and enter early once the trend reverses.
  • Range trading/ channel trading. The first step is analyzing the most recent price action. Looking at chart patterns, the trader names typical highs and lows of the day and monitors their differences.
  • Breakout trading. It analyzes the currency pair’s range during specific times or hours of the day and cast trades on either to catch a breakout in either direction.
  • News trading. This strategy is very famous and traditional, especially for the people who prefer short-term trading strategies. These day traders depend on news like economic data, breaking news, or even tweets of presidents.

Who would utilize day trading the best?

People have different styles. Some prefer fast, and some prefer slow. Also, some people prefer the “in-betweens.” Hence, if you don’t like scalping because it’s too quick and you don’t like swing trading because it’s way too slow, you might want to take day trading for a spin.

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