Intraday Trading Strategies

Intraday Trading Strategies

Intra day trading simply means the entry and exit of the market within the same session and is also known as day trading. This type of forex trading is particularly risky but the right strategy can bring significant gains.

Not all stocks are suitable for day trading and to identify the right target the intra day trader will look for two key qualities: volatility and liquidity. The forex market offers both of these making it ideally suited to those wanting to engage in short term trading.

Many traders who opt for day trading hope to make large gains much easier than in other types of trading but very often this is simply not the case. In reality day traders look for much smaller gains per trade than those using longer term strategies, meaning that one big loss can have much more of an impact.

Psychological factors are particularly important in day trading and it is important to be a master of your own emotions if you are to be profitable. The biggest mistakes novices to this type of trading make is to believe that every day must end in positive territory, no matter how small. The law of averages dictates that this simply will not be the case and some days will result in a loss. One technique successful day traders use is to calculate the maximum loss they can sustain per day. If at any point they reach that amount, they stop trading for the day because to continue carries the risk of losing more. Once the next day rolls around, the slate is wiped clean and the tally is re-set to zero. The added benefit to this is that you know that if you reach the point where you cannot afford to lose any more, you will simply stop – there is no internal pressure to try and reclaim your losses.

There are a few different methods involved in day trading and one of the most well-known is scalping. This involves a series of very short term trades where the position is sold as soon as it turns a profit. To make money from scalping requires a number of winning positions throughout the day as each trade`s returns are likely to be trivial.

Fading is another popular option. This type of intra day trading involves identifying stocks which have swung sharply higher and then entering a short position. Fading is an extremely high risk tactic and is based around the assumption that the stock has been overbought and the earlier buyers will want to collect on their profit. The exit point for fading is once buyers start to come in for the trade again.

Intra day trading is also very suitable for positions based on momentum. This type of strategy focuses on identifying strong trends with high volumes, or riding a wave based on news or market announcements. Traders can either opt to buy at the earliest sign of a trend or immediately upon a news release and sell once volumes start to decline – a sign that reversal is about to occur – or will simply fade the surge in price when the opposite action is taken.

Intra day trading utilises many of the same strategies as longer term trading but the crucial difference is upon exit. To make money in either forex market or any other kind of market amenable to intra day trading, it is essential to be able to close positions before the tide starts to turn, making stop losses an even more useful tool than usual. With attention to detail and discipline, intra day trading can bring significant returns.

Kaiser Report #190

Every week Max Keiser looks at all the scandal behind the financial news headlines.

This week Max Keiser and co-host, Stacy Herbert, ask why wallstreet protesters are maced in the face for merely walking on the sidewalk while JP Morgan’s CEO can throw a tirade in the face of regulators and a central banker without being pepper-sprayed. They ask why Vince Cable doesn’t pack some pepper spray when confronted with ‘investor’ threats. They also look at what infamous BBC guest, now viral Youtube sensation and famous tweeter, Alessio Rastani, said that was so upsetting to the powers that be. In the second half of the show Max talks to Nomi Prins, author of Black Tuesday, about all the manic meetings happening around the world to save the global financial system facade when it is the system itself rotting from within that is the problem. Nomi Prins also compares the current financial crisis to the first Great Depression.

 

Go check it out.

Result of Forex Megadroid test

At the end of this post are all the trades made by Forex Megadroid during my eight week test period.
They were all made on a us-cent account at LiteForex and the balance has been around $400 (40 000 cent). That’s almost $23 return on $400 in eight weeks or 37% over a year, if I have my numbers right.

It is still far off the claims from the Forex Megadroid home page but but certainly good enough stay among my trading tools. If I keep the balance around $400 and it continues to trade like this it will have paid itself in a year. Since I add some money every second month and hopefully make money from my other trades it should be a lot quicker than that.

A year to get paid back might seem like a long time in such a risky business as Forex actually is, especially when faith has to be put in a more or less autonomous piece of software. I’ve made enough back to give it a chance even though I know these eight weeks might not be representative over the long run. Considering that I’ve lost more than the cost of Forex Megadroid because of crappy positions put manually it was not a hard choice to make.

If you are still indecisive about giving Forex Megadroid a chance I’ll ease your ambivalence pain by giving you $20 back if you buy it through on of my links and send me your ClickBank receipt after the 60 days are up. (You can use the comment field here, or on any post at swingpips.com to contact me.)

Best regards and happy trading.

Open Close Proffit
11-03-01 00:46 sell 1,3805 11-03-01 03:46 1,3805 0,00
11-03-01 00:55 sell 1,3810 11-03-01 03:40 1,3809 10,20
11-03-11 00:57 sell 1,3803 11-03-11 02:17 1,3801 42,20
11-03-11 00:57 sell 1,3802 11-03-11 02:17 1,3800 37,80
11-03-16 23:01 sell 1,3908 11-03-17 00:06 1,3904 84,40
11-03-16 23:14 sell 1,3913 11-03-16 23:16 1,3903 189,00
11-03-16 23:17 sell 1,3915 11-03-16 23:18 1,3905 190,00
11-03-16 23:27 buy 1,3925 11-03-16 23:46 1,3936 110,00
11-03-16 23:30 sell 1,3917 11-03-16 23:30 1,3907 190,00
11-03-16 23:45 sell 1,3922 11-03-16 23:49 1,3912 191,00
11-03-17 23:22 sell 1,4026 11-03-18 00:23 1,4017 188,10
11-03-23 22:00 buy 1,4106 11-03-24 01:23 1,4107 19,20
11-03-23 23:03 buy 1,4083 11-03-24 00:00 1,4098 264,00
11-03-24 22:08 buy 1,4169 11-03-24 23:04 1,4179 191,00
11-04-06 00:51 buy 1,4216 11-04-06 01:10 1,4226 213,00
11-04-08 00:02 sell 1,4309 11-04-08 01:06 1,4304 109,00
11-04-20 23:33 sell 1,4523 11-04-21 01:12 1,4519 81,60
11-04-21 00:01 sell 1,4524 11-04-21 01:05 1,4520 73,20
11-04-21 23:00 sell 1,4557 11-04-22 00:22 1,4552 105,00
Total: 2 288,70