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5 Everyday Practices Of Successful Day Traders That You Can Emulate

Every day the markets offer a plethora of opportunities to achieve profits. However, only a small portion of traders manage to extract them. This puzzle might have made you wonder what special techniques are these traders applying while trading.

Every trader has a personalized trading style, niche investment domain, and a set of rules or guidelines. However, there exist a few pivotal day trading tips that every skilled trader knows and adopts religiously.

Everyday Practices Of Successful Traders

Some of the most successful traders are utilizing the best, but not so familiar methods and resources. Fortunately, here are some day trading secrets below that may reveal some of those valuable tricks - 

1. Develop Strategies Based On Knowledge
With the instant transmission of intelligence about an event on the other side of the world, you can foretell your next move in the market. Thus, having access to reliable news sources is paramount. 

However, some resources go beyond reporting breaking news. They also render in-depth insight and commentary. Such critical reporting sources can enhance your ability to anticipate future price movements.

All the greatest traders have kick-started their careers by identifying a niche market relevant to their skills, knowledge, passions, and experience and then devoted time and effort to develop, backtest and implement a winning strategy. 

2. Economic Calendars
An economic calendar is a tool often neglected by traders. These calendars record the occurrence of market-moving events. When used accurately, they can also help you foretell and organize a strategy around a future event.

Economic calendars can help break down influential events, that include -

  • Interest rate decisions
  • GDP announcements
  • Consumer Price Index (CPI)
  • Non-farm payroll numbers
  • Purchasing Managers’ Index (PMI)
  • An economic calendar also instills discipline and management, both of which are significantly relevant qualities day traders must realize.

It will help if you implement the Price Alerts tool. It facilitates traders to track all worldwide economic events in real-time through their economic calendar.

Alpaca is a technology company that modularizes the world’s asset management activities. You can visit Alpaca to understand what is a wash sale and gain deeper insights into the strategies that can help you avoid triggering a wash sale while trading in the markets.

3. Avoid Ambitious Trades And Have A Simplistic Approach
The best traders realize that smart trading is not equitable to gambling. Smart trading is about identifying when the potential gain justifies the involved risk. 

While it might entice you to chase holy grail trades that can produce extravagant returns in a brief amount of time, being able to avoid that temptation distinguishes the great traders from the crowd. 

Great traders take base hits consistently to make a living, while every once in a while, they become successful in a big trade deal.

Any theory or instrument that claims to beat the system by suggesting some magic mantra by ignoring the inherent balance between risk and return will inevitably fail.

Successful traders identify an area in the market where they can become a master, and then consistently perform well in that market by the day. 

You might deal with complex ideas and instruments, but the underlying principles that you will apply to steer your trades will be the same elementary rules that all great traders implement in their mundane. 

4. Practice Thoroughly And Learn To Accept Losses 
Extracting profits from intraday price fluctuations demands an element other than trading intellect, and it is called practice. 

Too many traders lose their hard-earned capital from rookie mistakes that would have been best if practiced in a demo account. Thus, these practice accounts are the perfect arena to hone a strategy and gain familiarity with the markets.

One of the finest day trading success secrets is to enforce prospective strategies using a simulator account first. Funded with virtual capital, you can pinpoint flaws and enhance your technique until it generates stable profits. 

While practicing on demo accounts, you must be familiar with dealing with losses, or else you will lose wealth. Occasionally, you might be very deviant from the typical trend and lose enormous sums of money.

The most proficient traders accept that they trade in a world of uncertainty and that inevitably, they might end up being wrong.  

The greatest traders calmly execute their trades day by day and make critical adjustments to their trading strategies as they receive real-time feedback from the market. 

It will be helpful if you learn to cut losses with limit orders. 

Decide on the type of orders that you will use to enter and exit trades. Choose between market orders, limit orders, or some other types. 

When you place a market order, it gets executed at the best price available at the time, and thus, there exists no price guarantee. 

A limit order assures you the price but not the execution. Limit orders can help you trade with greater accuracy, wherein you fix your price for buying and selling. 

The sophisticated and experienced day traders even use options strategies to hedge their positions.

5. Trade Diary Secrets
Too many traders stay concerned with quantity and neglect sitting down and studying the quality of their trades executed so far.

Neglecting the need to recognize where and why your trades are going wrong can be devastating to your funds. 

Therefore, maintaining an online trade journal can go a long way in tracking your daily trades and potential strategies.

Online trade journals let you plan trades, position sizes and maintain a detailed record of past trading activities that include -

  • Entry & exit points
  • Time of open & close
  • Position size
  • Data of trade
  • Profit/loss
This data enables you to look back and identify flaws in your strategy conveniently. While your fellow traders might commit rookie mistakes of not tracking trades and not updating their policies with time, you will always be a step ahead.

When trading, you must be aware of the market close time and know when to make your move to gain maximum profits and avoid price volatility.

Final Words

Day trading demands a lot of practice and know-how, along with the involvement of several factors that can make the process tedious. 

First, you must realize that you are going up against professionals whose careers revolve around trading. 

As an individual investor, it is normal to feel prone to emotional and psychological biases. Professional traders can eliminate these factors from their trading strategies by regulating their emotions more effectively.

Once you have the data that corroborates your strategy being a profitable one, then all you have to do is adhere to the plan while trading with real capital.

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