Day trading Basics

[manojborle]

Day Trading
Day traders buy and sell stocks throughout the day in the hope that the price of the stocks will fluctuate in value during the day, allowing them to earn quick profits. A day trader will hold a stock anywhere from a few seconds to a few hours, but will always sell all of those stocks before the close of each day. The day trader will therefore not own any positions at the close of any day, and there is overnight risk.

Swing Trading
The principal difference between day trading and swing trading is that swing traders will normally have a slightly longer time horizon than day traders for holding a position in a stock. As is the case with day traders, swing traders also attempt to predict the short term fluctuation in a stock's price. However, swing traders are willing to hold stocks for more than one day, if necessary, to give the stock price some time to move or to capture additional momentum in the stock's price. Swing traders will generally hold on to their stock positions anywhere from a few hours to several days.

Position Trading
Position trading is similar to swing trading, but with a longer time horizon. Position traders hold stocks for a time period anywhere from one day to several weeks or months. These traders seek to identify stocks where the technical trends suggest a possible large movement in price is likely to occur

Please correct me wherever wrong.

 

[Micky101]

Dude u will never make money if u r looking for ppl to guide you. The systems that you use would be used by (if i may say so) every other guy who reads the book.

Burn them all coz i'll give u some gyan without writing a book

Moving average has two functions:
1) They act as support resistance lines
2) They provide you the trend

Plot 5,10,20 that should b enough for swing trading & 3,5,10 on daily charts to get a idea of what prices are doing.
Everything every indicator is actually moving average with a fancy name.

Go through these two videos that will tell you how to use moving average.

http://www.youtube.com/watch?v=gw-1AhbYP8Q&feature=BFa&list=UL25WiPIndXtA

http://www.youtube.com/watch?v=25WiPIndXtA&feature=channel&list=UL

I hope this helps & do back testing on ur strategies don't listen to every1 coz most of them wants to use u as a workhorse for testing there strategies.
Make ur own mistakes learn from them & b disciplined to not repeat them collect data & test & back test.

Wish u a b8r future as trader

Regards
Micky

 

[bali007]

The author has described a method called "Stochastics pop".
It is termed so because "it enters markets when most traders consider the market to be overbought or oversold".

This method takes advantage of buying when momentum is strong and selling when momentum is weak.

Rules for Buy Entry :
1. Buy signal will be generated when %K is at 75 or higher at the end of time frame you have selected.
2. Buy order should be at the market.
3. Once the entry is made, Exit can be any of the following ways...
---- Risk management sop loss (i am trying with stop loss below the low of the candle.
------- as soon as %K and %D have crossed over one another in the selected time frame.
4. exit should also be at the market.

Rules for Short Entry :
1. Short signal will be generated when %K is at 25 or lower at the end of time frame you have selected.
2. Short order should be at the market.
3. Once the entry is made, Exit can be any of the following ways...
---- Risk management sop loss (i am trying with stop loss above the high of the candle.
------- as soon as %K and %D have crossed over one another in the selected time frame.
4. exit should also be at the market.

thanks for your thread :thumb::thumb::thumb:

I think if you share experience on oscillator, just read the beautiful thread from ST Da.
http://www.traderji.com/day-trading/30182-how-trade-oscillator.html

It will definitely help to other reader of this thread.

 

[prabhsingh]

Please correct me wherever wrong.

Will that be correct to say that Swing Trading and Positional trading are almost equivalent.As far as time frame is concerned it seems both of them suggest holding stock/derivates for couple of days/week.Is there any big difference between both of them?

 

[manojborle]

Will that be correct to say that Swing Trading and Positional trading are almost equivalent.As far as time frame is concerned it seems both of them suggest holding stock/derivates for couple of days/week.Is there any big difference between both of them?

Traders who swing trade typically look for trend reversals & retracements for their entry/exit points whereas positional trades are also held during periods of minor retracement with the expectation that they will eventually continue trending in the desired direction.