daytrading, where to start?

[newguy05]

Hi, i am looking for suggestions on resources for daytrading, basically to get started.

Have been doing long term (1-12months holding period) stock/option trading for a while and made some money, but they have always bugged me. After much thought, i think my personality is much more suited for daytrading. Here are my questions:

1) What is a good day trading book that will teach you all the basics for someone with zero experience in daytrading (ie difference between prop firm vs retail, daytrading margin requirements, etc... )

2) What is a good day trading brokerage(is that the right term?) that will let me open an account just to do paper trading.

3) What are good instruments to start daytrade for a complete newbie? I am only familiar with stocks and options market, not futures or forex(?)

Here's my plan:

1) Do the basic research (read the books, understand the various strategies, instruments used etc..)

2) Open a paper trading account, and test / refine my strategy for a period of 2 months at min, or until i am consistent to be profitable. If it doesnt workout, then i have no problem abandoning this whole plan as daytrading may not be for me.

3) Start with real money, in very small amounts again to gain consistency.

4) My eventual goal is to invest 100k of my savings into the day trading account, but that's not going to happen for a while until i am confident with myself and my system.

Anyway looking for a few pointers in the right direction to get started on my research. Thanks

 

[YoungOne]

You can read all you want but nothing beats screen time. Get a solid real time trading platform and just stare at the screen. Eventually you will get a feel for things. Your best bet is to just deposit funds into a broker that offers paper trading so that you can just use their software. After you have got enough screen time and can consistently make money on paper, go live. Just trade 100 shares or 1 contract if futures, than slowly move up. Best of luck to.

 

[newguy05]

Quote from YoungOne:

You can read all you want but nothing beats screen time. Get a solid real time trading platform and just stare at the screen. Eventually you will get a feel for things. Your best bet is to just deposit funds into a broker that offers paper trading so that you can just use their software. After you have got enough screen time and can consistently make money on paper, go live. Just trade 100 shares or 1 contract if futures, than slowly move up. Best of luck to.

hi there, yes i understand nothing beats experience and will definitly be staring at the screens for a long time. But first, i really do need to read a book or 2 just to get the very basics down, i am not going to understand how to interpret the intraday chart movements etc..without knowing the basic of strategies like fading gap etc..

 

[kiwi_trader]

For "how to trade" try Alexander Elder's books plus Marcel Link's book.

For understanding the markets just troll around here and around T2W. Its all there if you spend the time and make some notes.

 

[xyannix]

Reminiscences of a Stock Operator is the best book ever for "speculating" / day trading!

For options you should buy, Options As a Strategic Investment, it is not a book but more of an encyclopedia for option strategies.

It is really hard to learn just by reading or having a fake portfolio because you a fake portfolio doesn't take your emotion into account.

You should watch bonds (ten year), currencies (yen), oil, metals and see how it all affects the stock market.

 

[samus]

"Trading In The Zone" should be required reading for anyone who wants to be a trader. Save yourself a lot of heartache and read this book.

 

[newguy05]

sorry i am a little confused, are those generic books about trading? Is there a book that specifically deals with daytrading only? or is there no such thing. thanks

 

[neke]

Quote from newguy05:

Hi, i am looking for suggestions on resources for daytrading, basically to get started.

Have been doing long term (1-12months holding period) stock/option trading for a while and made some money, but they have always bugged me. After much thought, i think my personality is much more suited for daytrading. Here are my questions:

1) What is a good day trading book that will teach you all the basics for someone with zero experience in daytrading (ie difference between prop firm vs retail, daytrading margin requirements, etc... )

You can get most of the answers to those questions by free reading on the web: google those terms (day trading, daytrading margin requirements, how stocks work etc), get free materials on the web sites of brokers (like Interactive Brokers, Ameritrade, or exchanges like Nasdaq)

2) What is a good day trading brokerage(is that the right term?) that will let me open an account just to do paper trading.

InteractiveBrokers allows you a create a simulated trading account alongside your trading account: so just open your trading account (funded with the minimum), and open the simulated account free of charge, and do all your trading in the simulated to start with. I think you pay like $10 a month if you do not trade real (pay commission) for the month.

3) What are good instruments to start daytrade for a complete newbie? I am only familiar with stocks and options market, not futures or forex(?)


Going by my experience, you are better of starting with stocks. Learn about buying and shorting stocks. As for developing a working edge, like some have said, you need the watching and doing to get a feel for how the market works, along with developing your mindset. Start small if you are going live, otherwise learn as much as you can from your simulated trades, measure your performance, and ask yourself questions if you are losing. Do not expect to go live and make money unless you feel confident you have observed patterns that tend to repeat.

 

[MandelbrotSet]

Quote from newguy05:

sorry i am a little confused, are those generic books about trading? Is there a book that specifically deals with daytrading only? or is there no such thing. thanks

Here's a list of where you could start, according to what you say you want to do:

Daytrading Books

 

[newguy05]

thanks guys, have been reading the forum, especially that thread subjected "Trading fulltime retail with $50k" by wiseman was very interesting.

That book list is exactly what i am looking for, going through them now.