How Many Strategies Do I Need?
Submitted: 24 Jan 11 14:08
Last Updated: 24 Jan 11 14:15
 

A day trader’s advantage is the speed of market movement, and the frequency of repetition of market behavior. More strategies do not mean it is better. Traders that always feel the need to have more and more strategies imply that they are very afraid of losing out, and this flaw will easily manifest itself into other trading sins easily.

1 or 2 strategies with good probability of success, and that a trader find easy to spot is all it takes. The key here is the frequency of repetition. Within a 2 hour session, if the strategy can appears 2-4 times, it is considered optimum as that means it is not too quick, and that allows the trader to be in a more relaxed state. Day trading can be intense and if the trader takes too many different strategies and the strategies itself is too rapid, he will be burnt our very quickly and open himself up for mistakes.

After the strategies have been identified, the crucial step is for the trader to execute the trade flawlessly. This means taking the trade without resistance and doubt. This can only be achieved by:

1. Observing the strategy setup multiple times.

2. Taking the trade based on the setup in a simulated environment WITH HIGH   REPETITION OF SUCCESS.

3. Taking the trade based on the setup in a LIVE trading environment WITH HIGH     REPETITION OF SUCCESS.

Once the cycles of trade taking and success repeats itself enough, the trader will learn to trust his system and HIMSELF and he secures his way to trading success.

 

 

 
What Do I Need To Start Trading?
Submitted: 14 Jan 11 18:32
 

Trading is all about assessing information presented to you and taking decisions to buy or sell the instrument you are trading.

If you like to trade based on financial reports, analysts reports, then having access to CNN Money or MSN Money will suffice (Fundamental Analysis). They also provide subscribed services which provide more in-depth analysis and additional market information.

If you are trading based on price charts (Technical Analysis), you will need a Charting software and Datafeed. Charting software helps to plot the price into a chart so the price movements take a very visual approach. Datafeed is the price information that is fed into your charting software. They can be provided free by your broker, or subscribed from Market Datafeed Providers. If the datafeed provided by your broker is free, it is still best to use them as it reduces your trading costs drastically.

All traders will need a broker to carry out the trades for them. Do look around for brokers that charge a reasonable commission but be wary of brokers that claim too low or no commission. Nothing is free, and the money will need to come from somewhere. Always find out more before committing. A good broker is crucial to your success in your trading business, so choose wisely.

The final thing is time and effort. Invest them in your venture, formulate strategies to help you make trading calls and not leave anything to chance. Trading is a probability game, not a gamble.