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Everything Forex Trading Part I of II

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The Foreign Exchange is also knows as currency trading, Forex, or simply FX. In Forex trading every currency worldwide is traded in a global market. With an average trading volume of $5 trillion per day, it is the most liquid and largest market. All stock markets combined don’t even come close to this number.

With such high volume of trading, you may find some great oportunities for yourself in the forex market.

A single USD on any given day could get you 1.1 CAD. The very next day this USD could get you 1.15 CAD. Small changes such can these might not seem like they’d make a difference, but when put on a large scale, the significance becomes apparent.

Lets use an example of a company who pays employees overseas. Imagine what currency exchange rate could do to the company’s bottom line. Lets say for example, they are exchanging one currency for another that is at a higher value. It would be beneficial for the company to make their trade on a day when the exchange rate is lower. If the company needed to exchange USD to CAD, using the example above, it would greatly benefit the company to make their exchange on the day where CAD is 1.1 rather than 1.15. Pennies will add up quick when on a large scale.

Like being a business owner or traveler, when trading forex, you will want to make trades with the knowledge of when exchange rates will change to receive a more favorable rate.

FOREIGN TRANSACTIONS

Foreign transactions in the market are similar to what you may have done if you’ve traveled abroad. A trip north across the border and you are converting USD into CAD. The exchange rate between the two currencies is based on supply and demand. This is what determines how many CAD you get for you USD and the rate of this exchange is constantly fluctuating.

OPPORTUNITIES IN FOREX: WHAT’S YOUR OPINION?

Like stocks, currencies are traded based on what is their assumed value and what direction that value is headed.

The big difference in forex vs stocks is that trading up is done as easily as trading down. Because the market is so large it is easy to find a buyer or seller for the currency you have your eye on. Based on what foreign news you hear, you can decide the value of certain currency and then buy or sell as you see fit.

If you hear news that will cause the CAD to lose value then you would sell your CAD against another currency. The more the CAD depreciates agains the currency you sell it against, the more profit you make. If the CAD begins to regain value then you begin to lose profit and should quickly get out of the trade.

Read more about how to buy and sell currency as well as information on trading on margin in Everything Forex Trading Part II…

Day Trading: How to Know when to Buy or Sell

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How are you supposed to know when to buy or sell?

The overall goal of Day Trading is to exploit small movements in individual assets. The first big step towards this goal is knowing what to buy and when to buy it.

Looking at the liquidity, volatility and Trading Volume of an asset will help you asses if a trade is both profitable and right for you. Below you will see descriptions of what these things are, and learn how they can lead you to success. 

The first thing on the list to look at is the Liquidity of the asset.

Liquidity is what will allow you to enter and exit the trade at a favorable price.

Two things to note when assessing Liquidity are Spread. Liquidity is the difference between bid and ask. Slippage is the difference between the expected price of a trade and the actual price at which the trade is executed. You want to look for a tight spread and a low slippage.

Volatility is The next thing you will want to take into consideration when looking what to buy and sell.

The volatility will help you know when to buy.  It gives information on the expected price range. When Day Trading, a larger range in price will mean greater volatility.  This will result in either greater profit or greater loss.

Don’t forget to look at the Trading volume.

The trading volume is what tells us how many times a certain stock has been bought and sold. Volume is measured over a specific amount of time.  

If the trading volume is high this means a stock has a lot of interest. An increase in volume it is usually a sign of a price jump. After looking for this dumb you can better asses your trade. 

In Conclusion
These three things will help you a lot as you begin to decide when to buy and sell. Knowing how to observe the Liquidity, Volatility and Trading Volume  will be a great help to you as you get started in the world of Day Trading. 
 

Watch for these Forex Day Trading Mistakes

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DayTradeFEED.net has put together 5 Forex Day Trading mistakes to watch for

Day Trading can be a very profitable business, but devastating losses are common if you don’t know what you are doing.

At DayTradeFEED.net, we want you to make money day trading–not loose money. Watching for these 3 forex day trading mistakes will help you achieve success.

Averaging Down

Averaging down isn’t the ideal technique for day trading.

Lots of traders end up using the averaging down technique. Averaging down is not the ideal technique, but it can be easy to slip into.

The biggest issue is that when averaging down you are holding a losing position. This means you are possibly sacrificing time and money. Day Trading is such an ever moving process, that your money could be planted in a much better situation.

Another issue with Averaging down is that to you have to get a higher percentage on return to make up for any capital lost from the initial loss. For example, if you lose of our capital, you will have to get a return of 100% to break even. Maintaining these standards in unreasonable in the long run.

Averaging down will eventually end in a inevitably lead to a large loss. Market trends can remain in place longer than you can stay liquid. It is not worth taking the risk of Averaging Down.

Positioning Trades Too Early

Day Traders have to pay close attention to the news surrounding the market. Traders will become very familiar with what news will cause the market to move. It is impossible to know in advance however, exactly which direction the market will move.

 Volatility is a key factor for day traders, but which way will the market move? It is not wise to jump to conclusion before news is announced. It is not worth the risk.

After the News Hits 

News can hit the markets at any time. It seems like easy money to react and take advantage, but you must have a strategy! If not, results can be every bit as devastating as they would be if you traded before the breaking news.

Day Trading should take place after a trend has been defined. Being patient will lower your risk and increase your likelyhood of effective trading.

Risking too Much

More Than 1% of Capital on Forex Trades 

Big risk doesn’t always mean big return. Most traders who take big risks eventually lose big. It is a common rule that traders should only risk 1% of capitol for a single trade.

Limiting the risk percentage will help keep your portfolio on track. Sticking to the 1% rule will ensure that no single trade will break the purpose of this method is to make sure no single trade will break the budget.

Avoid being Unrealistic

It is good to work hard and set goals, however being unrealistic can lead to forex day trading mistakes. The unrealistic expectations we set for ourselves can be projected on the market. The best technique is to watch the market and see it for what it is.

The best way to see the market for what it is is to create a trading plan. Research trading plans and testing them is the best method for day trading success.

DayTradeFeed’s Method

If you are beginning to Day Trade, or if your current method is not yielding success, try us out. We’re here to help

Day Trading: How To Minimize Risk

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The risk of Day Trading is not breaking news. One of the best ways to minimize Day Trading Risk is to use stop-loss orders. For long positions, you can use a stop loss order to make sure your loss on certain stocks is not greater than a set number.

Let’s look at an example:

You have 20 shares at 20$ a piece and you are only willing to lose 2$ per share. This means you will place a stop loss at 18$. This way, if your stock plummets to 5$ a share you are not risking a loss of 15$ per share.

A good strategy to limit Losses when day trading is to set a physical stop-loss order, but to also set a mental stop-loss. The physical stop loss is going to physically limit how much you can lose. Your mental stop-loss will put you in a spot where you can immediately exit your position if you trade makes a turn.
 We also recommend setting an amount that you are willing to risk each day. This will minimize your risk for big losses in a single days time. Setting this limit for yourself will help you trade with a clear mind.

If you feel your chosen strategy lines up with your risk limit, then you should begin trying it out. Trying your strategy with paper trade is a great way to feel more confident. Analyze your paper trades and make notes on where you feel your were profitable and where your expectations were either met or not quite met.

The next step will be using a demo trade account that using real market information. Give yourself some time to work with movement in these demo accounts before moving on.

Make sure while practicing, that you are doing your homework. Look at historical charts, making note on where your stop loss would be hit or where your target would be hit. If after research and trial runs you feel your account has been profitable, then it is time to move forward.

If you find you have lost capitol, then change your strategy and try again. Do not start a new strategy on a real account. Be patient and do it right. This will minimize your losses.

Day Trading Futures: Pros and Cons

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The Pros

Day Trading is great because all trades are completed when the market closes for the day.

Futures usually open at a price that is very different from where they end. Volatility means you can fall asleep at night in a winning position, and wake up at a loss. Day Trading provides rest from this risk. Literal rest. A good nights sleep.

There is no overnight risk with Day Trading, which is one of it’s biggest Pros.

There is a lot to learn when entering the trading world.

Day Trading is like an accelerated learning course in trading. You’ll make more trades in a day than position traders. This will help you learn quickly what is necessary for success. You’ll

The Cons

It takes great discipline to day trade. It can be vey difficult to stay the course and not over reach. Many who try out day trading find themselves overreaching and over trading.

Commissions can also be an issue when Day Trading. It is very possible to break even, but have a big commission bill at the end of the year. To make money day trading you have to make many winning trades.

A Word On Volatility

Short term trading can outweigh long term investing in certain situations. Volatility of the market will determine which approach is most favorable.

In a highly volatile market, prices are moving up and down frantically. This is what you want to look for. The high volatility allows you to buy and sell for profit within a days time. A stagnant market is a no go for day traders.

Day Trading takes a lot of preparation, education and discipline. It can me really difficult to make money Day Trading. It is crucial that you treat it seriously and dedicate proper time.

However, if you do your research and map out a game plan, Day Trading can be a very rewarding.

10 Tips for Day Trading Success: Part 2

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Welcome to DayTradeFEED.net’s 10 Tips for Day Trading Success: Part 2. Make sure you don’t miss out on the tips we discussed In 10 Tips for Day Trading Success: Part 1

Tip #6 Timing is Everything

The majority of orders are made in the market’s first thing in the morning.  This helps contribute to the market’s volatility which Day Traders thrive off of. With practice you may be able to see the market patters and pick the best times to make trades, but for beginners its better to wait a 20 minutes or so before making your first move.
During the middle of the day, the market is more stable, but towards the end of the day there is another volatile period before markets close. The volatility of early morning and late afternoon markets are tempting as they provide more opportunity, but we caution beginners to avoid them until more knowledgeable.

7. Use Limit Orders

Figure out your enter and exit strategies. You may use Market Orders which are fast and reliable, or Limit Orders that will give you more control over the execution price. I
If you choose to use a market order there will be no price guarantee as it is executed at the best price available at the time. Going the route of limit orders, however, will give a guarantee on the price but not necessarily the execution meaning the trade may not go through at all.

8. Patience is a Virtue

Whatever strategies you use, make sure you are patient and consistent. Your strategies may not work every single time but the average will lead to day trading success. It is not uncommon for professional Day Traders to win only 50% or 60% of their trades. Be sure that you are limiting your risk, and your methods very well outlined.

9. Keep your Cool

There will absolutely be times when the stock markets get at your nerves. To see success when day trading you have to trade without emotions. Don’t let things like hope, fear and greed influence your decisions. You will be most profitable in you make moves based on logic.

10. Keep on Keepin on

It is important to move fast if you want to be a Successful day trader. Moving fast, however, does not have to be stressful. You’ve now read the first 9 tips, and you understand what its going to take to be profitable. Get your strategy locked in. Practice patience and discipline. If you do these things, there will be no need for stress and anxiety.
Don’t forget he Day Trader’s mantra: “Plan your trade and trade your plan.”

10 Tips for Day Trading Success: Part 1

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10 Tips for Day Trading Success: Part 1

When Day trading, you are buying and selling stocks very quickly. Most stocks will be traded one or more times during a single day. Looking for small changes and taking advantage of these changes can be a very rewarding, but it must be done correctly. Stick with these 10 tips and you’ll be on your way to Day Trading success.

However while there is good opportunity to make money Day Trading, it can also be vey challenging and end in a loss for those who are un educated in the strategies involved. It takes a certain skill set that not everyone is cut out for.

Day Trading Tip #1 Know Your Stuff

As a day trader it is not enough to simply have a general knowledge of trading. To be successful day trading you need to be up to date on stock market news and current events that will cause changes in the stock market. It will be very valuable to you You will be ahead of the game if you are well informed about any changes or foreseen changes in the US economy as well as foreign economies.
Pay attention and spend some time with research if you want to be successful. A good strategy would be to make a list of stocks you may want to trade so that you might be able to pay close attention to changes in these market. Read or Listen to the news. Maybe consider joining twitter.

Day Trading Tip #2: Give Yourself a Cushion

Having a cushion of funds will let you fill confident as you make trades. Knowing what you are willing to risk will help you be more successful. A good range of risk for Day trading is around 1%. Lets use a .5% risk in an example:
Let’s say the trading account has $40,000. If we decide to risk .5% on an individual trade with a $40,000 account, then our maximum loss for this trade would be $200 (0.005 x $40,000).
When trading you have to set aside money and be aware it is a risk. You don’t have to be happy losing money on a trade, but must know it is a possibility. Having money set aside to trade will help you be comfortable and successful.

Day Trading Tip #3: Give it the Time it Deserves

Don’t move forward with Day Trading unless you are willing to devote some serious time. Most of your day will be involved with watching the markets and making trades. It is not something to do during your lunch breaks. To be successful you need to move quickly on trades is a major strategy. Also, as we discussed earlier, market research is so important and can be time consuming in its own right.

Day Trading Tip #4: Baby Steps

If you are just getting started with Day Trading, it is wise to not spread yourself too thin. Try focusing on one or two stock per session until you get the hang of it. This will allow you to really learn and analyze what is going on.

5. Less isn’t Always More

It’s not a bad idea to look for low stock prices and deals, but we don’t suggest using penny stocks. The low risk does not outlay the low chance of making large profits. Penny stocks are often times illiquid as well which is not ideal when day trading.

Stay tuned! 10 Day Trading Tips: Part 2 will out next week. contact us at daytradefeed.net with any questions on tips 1-5.

How Much Money Can I Earn Day Trading?

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HOW CAN I MAKE MONEY DAY TRADING?

How much money can you make day trading? Great question.

Day traders are not required to disclose their trading results to anyone but the IRS and because of this it is tricky to come up with an average of how much you can make. There are many strategies in trading. This, along with how much capitol traders are working with, must be taken into account.

In their 2011 research paper “The Behavior of Individual Investors,” Professors Brad M. Barner and Terrance Odean at University of California, Berkeley discuss how those who traded without diversified portfolios usually saw an average loss of money. There are also fees with transactions, so it is really important to have that proper education before attempting to make money during day trading.

HOW CAN I MAKE MORE THAN I LOSE?

The best way to assure that you are making money day trading and not losing money is to set stop/loss points as well as profit taking points. It’s important to not make too much of a gamble for an individual trade. The goal is to never allow one bad trade to ruin out your account.

Many full time day traders suggest that to make money day trading you should not risk more that 1% per trade.

Therefore, if you are looking at an account with $30,000 in it, the most you should be risking on a single trade would be $300. Using this 1% strategy will lessen your losses. This takes practice and discipline and will help you to make more money day trading.

A QUICK EXAMPLE

Let’s expound on the above example to see what setting stop/loss points looks like.

If we stick with a $30,000 account,  We are able to risk a maximum of $300 for a single trade. Let’s say the stop/loss is $0.04 and if the share price below $16 ($120,000 buying power/7,500 shares).  With this, we can take 7,500 ($300/$0.04) shares per trade to and stay within our $300 allowed.

Keep in mind this does not include Broker commissions.

FINAL THOUGHTS ON MAKING MONEY DAY TRADING

It would be wise to first ask yourself what you want from Day Trading. What kind of time are you willing to put in?
Using a Broker is a wise route if you and unexperienced, but they do take a commission which will cut into your net profit.  They are a more secure route, but even with a broker we don’t suggest looking at day trading like a hobby.
Day trading takes some serious discipline and training. The strategies are not 100% and there is always a risk. There is no guarantee that you will make money day trading or be able to predict your average rate of return over any period of time.
There are, however, some solid strategies. Mastering these will help you make that extra money you’ve been dreaming of. Contact us at DayTradeFeed If you are ready to commit to learning the strategies that can lead to success in making money day trading. Our personal Coaches can answer whatever questions  you may have.

Day Trading: Is It Right For You and Me? DayTradeFEED.net Investigates

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Is Day Trading Right for Me?

We live in an age where everyone is looking to make a little extra cash on the side. It’s no wonder why so many are asking, “Is Day Trading is right for me?”

It is true that unexperienced day traders can make expensive mistakes very quickly. For many, however, day trading is a great way to add some cushion to your income.

What is Day Trading?

To know if day trading is right for you, let’s first discuss what day trading is.

Day trading involves buying and selling stocks in a short period of time. Usually about a day.

When day trading, you are not expecting to make large sums of money with each trade. Instead, with each trade the goal is to make small profits.

The goal is that these small individual profits over time will add up to larger sums.

How Does Day Trading Work?

Successful day traders treat it like a full-time job, not merely hasty trading done between business meetings or at lunch.

Practice, practice practice. Those who make consistent money from Day Trading are devoting a lot of time to their work.  They rely heavily on the ever-changing stock market to earn profits.

It is better for Day Traders if the market moves up and down throughout the day regardless of which way it is moving.

When Day Trading, you will be looking for short-sell options to profit off of a falling stock or buying stocks that are trending upwards. Day traders are always looking for something to move around to make a profit.

So, Is Day Trading Right for Me?

In conclusion, only you can decide if Day Trading is Right for You.

Do you have the time to commit to it? Do you have the drive to practice and develop strategies?

A strong suggestion if interested, is opening a practice account before officially day trading. (contact us for more information on this)

This will allow you see what day trading would be like and observe potential results without a huge risk.

 

A Month’s Day Trading Results | DayTradeFEED.net

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Day Trading Results

Total Month’s Profit: $1,050

First of all, let me apologize for the delay in posting my Day Trading results. The month has been pretty busy for me with some vacations and business ventures (all funded by day trading, of course) but I’m excited to get back into the swing of things.

It was a decent month for me. Not my best month, but also not my most traded. In the coming months I should have more time to devote to trading and will make sure to get these results out a little more quickly than in the past!

Explaining Our Day Trading Results

Before we show you our day trading results, we always make sure to explain exactly which trades these results are coming from.

As we trade throughout the day, we record our trade results to post later on. These trade results come from all kinds of different strategies, including ONIT trades, SAT trades and normal daily trading.

When we say “ONIT,” we mean the Overnight Impact Trade. Similarly, when we say “SAT,” we mean the Sunday Afternoon Day Trade.

The ONIT is made Monday through Thursday, usually around 3:00 p.m. MST, and the SAT is a similar trade, but only made on Sunday afternoons. The trades are forex trades, and are placed on the EUR USD. Each trader simply sets the trade and forgets the trade each day, and watches the profits roll in.

Many traders swear by these trades, and this is one of the only places you can find them!

To learn more about this daily trade, contact us!

Now for Day Trade FEED’s day trading results…

Day Trading Results | Day Trade FEED

Day Trade FEED’s Day Trading Results

Daily Trades: 3
Pips Per Trade: 10
Total Pips: 30
Lot Size: 0.50
TOTAL PROFIT: $150

Placing these Overnight Impact Day Trades, Sunday Afternoon Day Trades or regular day-to-day trades would have made you $150 during the month.

Daily Trades: 3
Pips Per Trade: 10
Total Pips: 30
Lot Size: 0.50
TOTAL PROFIT: $150

Placing these Overnight Impact Day Trades, Sunday Afternoon Day Trades or regular day-to-day trades would have made you $300 during the month.

Daily Trades: 3
Pips Per Trade: 10
Total Pips: 30
Lot Size: 0.50
TOTAL PROFIT: $150

Placing these Overnight Impact Day Trades, Sunday Afternoon Day Trades or regular day-to-day trades would have made you $450 during the month.

Daily Trades: 3
Pips Per Trade: 10
Total Pips: 30
Lot Size: 0.50
TOTAL PROFIT: $150

Placing these Overnight Impact Day Trades, Sunday Afternoon Day Trades or regular day-to-day trades would have made you $600 in the month.

 

Daily Trades: 3
Pips Per Trade: 10
Total Pips: 30
Lot Size: 0.50
TOTAL PROFIT: $150

Placing these Overnight Impact Day Trades, Sunday Afternoon Day Trades or regular day-to-day trades would have made you $750 in the month.

Daily Trades: 3
Pips Per Trade: 10
Total Pips: 30
Lot Size: 0.50
TOTAL PROFIT: $150

Placing these Overnight Impact Day Trades, Sunday Afternoon Day Trades or regular day-to-day trades would have made you $900 in the month.

Daily Trades: 3
Pips Per Trade: 10
Total Pips: 30
Lot Size: 0.50
TOTAL PROFIT: $150

Placing these Overnight Impact Day Trades, Sunday Afternoon Day Trades or regular day-to-day trades would have made you $1050 in the month.

In conclusion…

What would you do with an extra $1,050 each month?

We are Day Trading, Forex and Futures specialists, and love all things day trading! You can find more information on day trading education systems by contacting us!

Want to be notified when we post our day trading results? 

    “IMPORTANT NOTE: Trading foreign exchange or futures on margin carries a high level of risk. It may not be suitable for all investors. The high degree of leverage can work against you. It can also work for you. Before deciding to trade foreign exchange or futures, you should carefully consider your investment objectives. Also check your  level  of  experience and risk appetite. The  possibility exists that you can lose some or all of your initial  investment. You should not invest money that you can’t afford to lose. You should be aware of all the risks associated with foreign exchange and futures trading. Seek advice from an independent financial adviser if you have any doubts or questions. Past trading history does not indicate future trading success.”