Day Trading

Day Trading

1. Momentum trader is a term for a day trader who uses a strategy based on trying to predict the trends in market prices. There are two types: An event-based momentum trader is a day trader who makes trading decisions based on market volatility resulting from news or incidents happening in the course of a trading day.

2. Things to do before trading

   • Invest in your self
     • buy books
     • invest in your education
   • Rituals to integrate you in the investment community
   • gain experience
     • Trade all kinds of products

3. pre market screening , gap screening, momentum screening

   • The pre-market is the period of trading activity that occurs before the regular market session. ... Many investors and traders watch the pre-market trading activity to judge the strength and direction of the market in anticipation for the regular trading session.

4. day traders and swing traders are searching for low float and a lot of volume being moved

5. technical analysis

   • Moving Averages
     • SMA
       • when holding a position for a longer period of time
     • EMA
       • short time frames, fast moving market
     • 10-20 for short-term trends
     • 50 for mid-term trends
     • 200 for long-term trends
   • RSI
     • overbought 1st up is up the 2nd up is low bullish divergence
       • oversold 1st low is low the 2nd low is high bearish divergence
   • Oscillator
     • 1st low has reached oversold but the 2nd low is lowest but has not reached the oversold, it may cause a bullish change
   • trend line
   • false breakout use stop lose
   • Breakouts

6. 3x3 principle

   • Stop loss 3% 1.03 or .97
   • 1st target 3%, 2nd target 6%-12% = rule 1st 3/4 (75%) 2nd 25%
   • from 1st target moving back half way must close 1/2 of the position