Skip to main content

Top Mistakes of Day Traders

Mistakes by Day Traders:  Day Traders buy/sell frequently compared to other investors. Main characteristics of Intraday trading are short holding periods and too frequent transactions. This sometimes results in mistakes and heavy losses. Many times a trader meets a disastrous loss in a single day.
This post details on the most common trading mistakes of intraday traders. A peek into these worst mistakes will help you avoid them.

Top Worst Mistakes by Day Traders

Here are the Mistakes by Day Traders which take them to ruins.

  1. Not Following Stop-Loss Orders

Setting and following a stop-loss is very crucial for success in day trading. Stringent stop loss is to put a cap on the losses before they grow big. Losses below the security gap do not ruin the trader. One of the common mistakes is when any trader crosses a stop order after losing. This mistake generally happens in the anticipation of a reverse course.

  1. Rush to Book Profits

Many intraday traders make decisions in hurry. A lot of traders rush to book profits before they decide the target and stop loss. The sequence while trading should be first determining the target and stop loss. The trader should decide on buying or short selling after that. Even if it is causing quick exits, do not change the stop loss price.

  1. Averaging in a Losing Position

Averaging for long in a losing position is good for some seasoned traders. But it might prove dangerous for some. Especially in the case of volatile and highly risky securities. As history shows, the biggest mistakes by day traders have happened when a trader continues to be in the losing position. We advise exiting if the buy or sell is not in your favor. Keep on averaging when there is a gaining position.


  1. Blindly Following Rumors

Following the rumours spread by brokers and media is yet another worst mistake. Going by market trends is recommended but avoid the rumours. Do not follow rumours of media without your own analysis. Going by the advice of TV channels and newspapers without reading charts can bring wrong decisions. 

  1. Too Frequent Trading

Most of the traders end up losing their hard earned money due to over trading. Any seasoned day trader will know that trading to frequently can be harmful to overall returns. Even if you are confident about the positive price trends, do not put all your funds to the trading.

  1. Avoid Homework and Research

Many traders jump into the buy or sell without any homework. Conducting proper research can save you from wrong trading. Especially when you are a novice, you do not have sufficient knowledge of understanding the trends. Hence, learning the trading patters is important. Getting information on the company and price movement is vital before trading. 

Conclusion :

By avoiding above common intraday trading mistakes, you can make a decent profit. Beginners in the day trading should be more cautious about making these mistakes. As an experienced trader, you can count on taking thoughtful risks. You need to have strong capability of bouncing back in the trading to bear the end-results of the mistakes.
For the most accurate and reliable Stock, Forex and Comex signal you can visit http://www.equidiousresearch.com or call us at (347)434-9044.

You can also visit:
Labels:

Comments

Post a Comment

Popular posts from this blog

Know More About- Commodity Currencies Trading

Currencies of countries that rely heavily on the export of  commodities  are often referred to as  commodity currencies . An important factor that any  forex trader  should consider is that the value of commodity currencies usually rise and fall in tandem with the value of the country's main commodity exports. What Are Commodity Currencies and Pair: Both the value of the  commodity  and the country's trade balance, with respect to the commodity, are significant factors in the valuation of commodity currencies. The most commonly traded commodity currencies are: Canada (CAD) New Zealand (NZD) Australia (AUD) The three  commodity pairs  are: USD/CAD AUD/USD NZD/USD These  pairs  are highly correlated to  commodity  fluctuations in the world markets and are the most heavily traded  commodity pairs  in  forex .  Forex  traders often trade these  commodity pairs  to gain expos...
Post a Comment
Read more

Fundamental Analysis-Impacts of Non Farm Payrolls Data on Forex Market

Non farm payrolls in the US increased by 164 thousand in April of 2018, following an upwardly revised 135 thousand in March and well below market expectations of 192 thousand.  The most important payroll statistic that is analyzed from the report is the  non-farm payroll  data, which represents the total number of paid U.S. workers of any business, excluding general government employees, private  household employees , employees of  nonprofit  organizations that provide assistance to individuals, and farm employees. Non Farm Payrolls Indicator The Non Farm Payrolls indicator measures the net change in the number of people employed within the U.S. economy in jobs other than those which are farming or agriculture related. When the NFP data is rising, it means businesses within the United States are hiring more staff, usually in response to improved economic conditions and increased demand for their products or services either domestically or overseas...
1 comment
Read more

TOP 7 MISTAKES IN FOREX TRADING

NO TRADING PLANS: A trading plan is a strict set of rules, half of which a trader draws from their trading strategy and the other one from their money management strategy. The plan may be then complemented by as many more points as the trader sees fit. WHAT IS TRADING PLAN: Specific market conditions for entering a trade; The amount of money to risk in a trade; Specific market conditions to get out if you are wrong (stop-loss); Specific market conditions to get out if you are right (take-profit); Approximate time for the market to reach your target; Note down and record everything! Write this list down as postulates and have it front of you before, after, and during your trading. RISKING TOO MUCH ON ONE TRADE: Never take too much risk in one trade. Forex brokers are allowed a lot of freedom in terms of leveraging their trading account, while beginner Traders lag behind in money management discipline. A combination of these two leads to high risk, hazard trading. Always...
Post a Comment
Read more