Day trading isn't an easy job to be successful at, yet with hard work and the right tools it's possible. Aside from your skill and your Internet connection, the ability to place trades with a reliable trading platform is key. If you're going to take the plunge into day trading, most trading platforms will suffice, but making sure it has several key features will give you a leg up on the competition.
Performing quick day trades requires an equally fast trading platform. Your day-trading platform compiles loads of data each second, keeping you apprised of the latest prices. The ability to convey this information accurately, without delay, is crucial to making successful day trades. When you make a trade, that order must also be executed in a timely fashion. How fast data is received, and your orders executed, will depend on your Internet and computer speeds as well as your broker, but a slow or unreliable trading platform can bog down even the best trading setup. Use a program that doesn't cause your computer lag or halt; place a market buy or sell order and it should be executed within a second or less.
Almost all day traders use analysis tools or indicators. These tools help monitor the market, and provide strategies to take advantage of intra-day price moves. A trading platform should provide the tools to analyze charts, execute trades and analyze your performance. Popular indicators include Fibonacci retracements and extensions, trendlines, moving averages, RSI, MACD and Bollinger Bands. The ability to compile "watch lists" and receive alerts when an asset reaches a certain price are also popular trading platform functions.
Trade Entry and Management
Taking advantage of intra-day price moves requires quick decisions and reflexes. The market is constantly fluctuating, producing new information you need to respond to. Your trading platform should make it easy to initiate, manage and exit trades. If the process is complicated, or placing an order takes more than five seconds, trading opportunities will be missed. While not required, a platform that places an automatic stop or profit target with each entry order can improve performance by minimizing risk and taking some of the emotion out of your trading.
Since you'll be spending a lot of time in front of your trading platform, the experience should be as comfortable as possible. Some platforms are highly customizable, while others leave you stuck with what someone else thought was functional or aesthetically pleasing. Customization includes being able to create your own indicators, alter available indicators, view varying days of price data, and alter the overall appearance.
- Comstock/Stockbyte/Getty Images
- About Short-Term Disability Insurance for Maternity Leave
- How to Find the Value of Antique or Vintage Items
- How to Rent Out a Condo
- How to Make Cheap Outside Christmas Decorations
- How Much Money Do Parents Spend Yearly on Kids and Teens?
- Do I Need a Building Permit for a Porch if I Do the Work Myself?
- Tips for Pregnant Women With No Health Insurance
- How to Trace a Certified Bank Check
- Buying & Fixing Up a Foreclosed House
- How Much Money Does the Average American Spend on Entertainment a Year?