What is the best way to learn how to day trade?
- Thread starter daytradelearner
- Start date
Do what doctors, lawyers, brain surgeons and any other person wanting to learn a skill would do: GET SOMEONE TO TEACH YOU.
It's a lot cheaper in the long run. Expecting to teach yourself a skill that can earn you thousands of dollars a week for a lifetime with little capital in an arena where most people get wiped out, is not realistic.
Get recommendations for a teacher from others, just like you would in choosing a school or university.
EL
It's a lot cheaper in the long run. Expecting to teach yourself a skill that can earn you thousands of dollars a week for a lifetime with little capital in an arena where most people get wiped out, is not realistic.
Get recommendations for a teacher from others, just like you would in choosing a school or university.
EL
Quote from austinp:
the best advice I can give anyone is to ignore all "advice" you get on public message boards from anonymous alias' that mask perennial losing traders.
your best bet might be to research the older P&L threads going back a few years, pm or email the consistent posters who were profitable then and weigh their advice.
but the absolute last thing you or anyone should ever do is take advice from those who are still wandering blindly in the proverbial desert themselves
So best to ignore the post above as well...
TLDR: Research, do some simulated trades on investopedia.com to get the jitters out, profit. Buy low, sell high, and trade with the trends. Listen to other traders with a grain of salt, and if you can't hang hire a pro.
I am mixed on some of the opinions being thrown out, so I'll offer my own experience.
I jumped into day trading after playing world of warcraft extensively (I know, I'm ashamed) and playing the game auction house. The rules of the auction house are exactly the same as the market though: buy below the market price, and sell above the market price. In the game world, it is not possible to know market price without "addons" to the game to track this data. The same is true of day trading.
You COULD just go strictly off price, buy low sell high, but how do you know if you're trading above market? How can you best estimate if the market will go up or down from the price you're buying? Are you buying at a premium or a discount?
You HAVE to use indicators, but keep in mind indicators aren't limited to the stuff you throw onto a chart. Reading balance sheets, understanding fundamentals, keeping up to date on market news....these are all tools in your toolbox in addition to things like schochastics, bollinger bands, moving averages, etc...You need to find out how YOU want to trade, and then find out what tools best serve YOUR trading style. Someone earlier said "the market is random." This is bullshit. Prices move for a reason, and "random" price movements can typically be attributed to human emotions. If you're going to be successful in any kind of trade you must understand the market, possess the ability to analyze it, and anticipate price movements.
So, how do you do that? Research. Youtube, investopedia.com, google, ET, the internet period. If you think day trading is free money, you need a reality check; the amount of research and observation a day trader performs basically equates to a full time job. A typical active trader watches the market from open to close, and then performs additional research after the market closes. If you're trying to ask how to day trade without putting in your own research, you're better off hiring a professional to manage your trades.
That being said, here's the best advice I can give you:
1) Research. You have to develop your own trading style. Are you trading stocks, ETFs, MFs, options, forex..? Are you doing multiple trades per day or buying a few a week for short-term holds? Are you going to short sell? Do you know what limit, stop, and trailing stop orders are? Stocks will probably be the easiest entry for a beginner, but you still need indicators. Learn how to read a chart, and I would recommend looking up the following terms as a MINIMUM for charts: Moving Averages, Bollinger Bands, Momentum, Schocastics, Pivot Points, Resistance/Support Lines, Volume, Candlestick patterns....the list truly is endless, and these are only very basic indicators. If you need charts for free try http://www.freestockcharts.com/ if you don't have other charting/brokerage software.
2) Practice. Investopedia.com has a great simulation with 20 min delayed stock quotes. You can join one of the mainstream games, or create your own game that matches your own trading parameters like starting capital. This allows you to trade/test strategies risk free, and can acclimate you to the process of buying and selling before actually putting money on the line.
3) More research. Now that you know how to "play the game," you've gotta find what you're going to buy. Charts can tell you a great deal, but don't forget about the other resources out there. You can find analyst opinions, fundamentals, technical analysis, balance sheets, etc. on everything you want to buy. Which strategy you employ will dictate which tools you want to use/exclude.
4) DO IT. Open an account with a broker and start making that money. The market isn't so much 'random' as it is 'uncertain.' The better you are at predicting entry and exit points the more successful you will be.
5) MORE RESEARCH. There are people (including some on this website) who have decades of trading experience, and you should use that to your advantage. The market can be a gritty place; listening to the veterans while evolving your own trading strategy is key. A day doesn't go by I don't learn another tool or tip.
To put this rant at an end...you've got to do your own homework and weed out the good and bad, and if you aren't willing to put the effort or don't have the skills you really should hire a broker to manage your trades for you. BUT, if you're willing to learn and have the aptitude, you too can join the ranks of the many caffeine-addled, sleep deprived, stressed-beyond-belief day traders who enjoy the freedoms and lifestyle of making money off of capital.
Buy low, sell high, and happy trading my friend I wish you the best and good luck!
I am mixed on some of the opinions being thrown out, so I'll offer my own experience.
I jumped into day trading after playing world of warcraft extensively (I know, I'm ashamed) and playing the game auction house. The rules of the auction house are exactly the same as the market though: buy below the market price, and sell above the market price. In the game world, it is not possible to know market price without "addons" to the game to track this data. The same is true of day trading.
You COULD just go strictly off price, buy low sell high, but how do you know if you're trading above market? How can you best estimate if the market will go up or down from the price you're buying? Are you buying at a premium or a discount?
You HAVE to use indicators, but keep in mind indicators aren't limited to the stuff you throw onto a chart. Reading balance sheets, understanding fundamentals, keeping up to date on market news....these are all tools in your toolbox in addition to things like schochastics, bollinger bands, moving averages, etc...You need to find out how YOU want to trade, and then find out what tools best serve YOUR trading style. Someone earlier said "the market is random." This is bullshit. Prices move for a reason, and "random" price movements can typically be attributed to human emotions. If you're going to be successful in any kind of trade you must understand the market, possess the ability to analyze it, and anticipate price movements.
So, how do you do that? Research. Youtube, investopedia.com, google, ET, the internet period. If you think day trading is free money, you need a reality check; the amount of research and observation a day trader performs basically equates to a full time job. A typical active trader watches the market from open to close, and then performs additional research after the market closes. If you're trying to ask how to day trade without putting in your own research, you're better off hiring a professional to manage your trades.
That being said, here's the best advice I can give you:
1) Research. You have to develop your own trading style. Are you trading stocks, ETFs, MFs, options, forex..? Are you doing multiple trades per day or buying a few a week for short-term holds? Are you going to short sell? Do you know what limit, stop, and trailing stop orders are? Stocks will probably be the easiest entry for a beginner, but you still need indicators. Learn how to read a chart, and I would recommend looking up the following terms as a MINIMUM for charts: Moving Averages, Bollinger Bands, Momentum, Schocastics, Pivot Points, Resistance/Support Lines, Volume, Candlestick patterns....the list truly is endless, and these are only very basic indicators. If you need charts for free try http://www.freestockcharts.com/ if you don't have other charting/brokerage software.
2) Practice. Investopedia.com has a great simulation with 20 min delayed stock quotes. You can join one of the mainstream games, or create your own game that matches your own trading parameters like starting capital. This allows you to trade/test strategies risk free, and can acclimate you to the process of buying and selling before actually putting money on the line.
3) More research. Now that you know how to "play the game," you've gotta find what you're going to buy. Charts can tell you a great deal, but don't forget about the other resources out there. You can find analyst opinions, fundamentals, technical analysis, balance sheets, etc. on everything you want to buy. Which strategy you employ will dictate which tools you want to use/exclude.
4) DO IT. Open an account with a broker and start making that money. The market isn't so much 'random' as it is 'uncertain.' The better you are at predicting entry and exit points the more successful you will be.
5) MORE RESEARCH. There are people (including some on this website) who have decades of trading experience, and you should use that to your advantage. The market can be a gritty place; listening to the veterans while evolving your own trading strategy is key. A day doesn't go by I don't learn another tool or tip.
To put this rant at an end...you've got to do your own homework and weed out the good and bad, and if you aren't willing to put the effort or don't have the skills you really should hire a broker to manage your trades for you. BUT, if you're willing to learn and have the aptitude, you too can join the ranks of the many caffeine-addled, sleep deprived, stressed-beyond-belief day traders who enjoy the freedoms and lifestyle of making money off of capital.
Buy low, sell high, and happy trading my friend I wish you the best and good luck!
Couldnt agree more. i think its a constant fight between buyers & sellers, at any point of time, any changes in the buyers/sellers mind/emotion can trigger any decision that could change the whole story.
i guess no matter what kinda 'analysis' our decision based on, its just nth more than a guess. but i still prefer to look at price alone as its simpler, if its up, its up. i cant accept when the price is going up & then smth telling me, hey, no, its down, or hey, wait for a while its going to come down.
How are you going to get out of your trades?.
Quote from Frits:
So best to ignore the post above as well...
pretty good chance I made more money yesterday alone than you have or ever will... at the rate you are going
try focusing your time and energy on what will bring you towards success (pleasure) than fixating on the educational mistakes you chose to make in the past (pain)
you might just break your personal cycle of losing and failure with newfound focus and sense of direction
shaka
With all due respect, this first-post question is usually a thread starter by other multiple aliases who enjoy spinning wheels of the other perennial aliases who frantically scramble to "save the newbies" from their own mistakes.
Said mistakes include deliberately choosing to spend tens of thousands of dollars on high-pressure hotel event sales pitches and/or promises of trade advisory rooms where they can follow the called trades verbatim and earn money without time, effort, thought or energy expended of their own.
Those two run-on sentences above pretty cover the gist of what this thread (and all those like it before and after) contains. If you are serious with your very first post here, which is statistically unlikely, there are literally hundreds of blogs and a handful of big message boards that spend time posting and discussing trading, trade methods, trading approaches, and info on how to trade.
As opposed to message boards that are mostly filled with what not to do, how everyone loses, how all traders are doomed and might as well shoot themselves in the head to end their misery now, etc
You can easily figure out for yourself which ones fit what descriptions
Quote from austinp:
With all due respect, this first-post question is usually a thread starter by other multiple aliases who enjoy spinning wheels of the other perennial aliases who frantically scramble to "save the newbies" from their own mistakes.
Said mistakes include deliberately choosing to spend tens of thousands of dollars on high-pressure hotel event sales pitches and/or promises of trade advisory rooms where they can follow the called trades verbatim and earn money without time, effort, thought or energy expended of their own.
Those two run-on sentences above pretty cover the gist of what this thread (and all those like it before and after) contains. If you are serious with your very first post here, which is statistically unlikely, there are literally hundreds of blogs and a handful of big message boards that spend time posting and discussing trading, trade methods, trading approaches, and info on how to trade.
As opposed to message boards that are mostly filled with what not to do, how everyone loses, how all traders are doomed and might as well shoot themselves in the head to end their misery now, etc
You can easily figure out for yourself which ones fit what descriptions
You do raise some good points in this post
!Shaka
,Frits
Quote from Wayne Gibbous:
You wanna learn to daytrade?
I could save you a lot of time by punching you till you hit the ground, taking all your money and kicking you before I left.
There. That's all there is to it!
You get my vote for ET's most humorous post ever!
I laughed so hard I had tears streaming down my cheeks...
