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What is a Day Trader?

What is a day trader?  You hear people discussing being a day trader on the news or television program. But you still do not have a clear understanding on what a day trader does. A day trader participates in the purchasing and selling of stocks on the same day.  The process for succeeding in day trading is based off the profits made throughout the day’s sales. In order to make a profit, different strategies need to be implemented. The strategies often require the day trader to think and act quickly in order to make a profit or to stop a large loss.

Trend Following

Trend following is a strategic approach to investment; a day trader must have up to date information on the market to act in an immediate, informed manner. A day trader will follow the current market trend to determine if the prices are going to rise or fall. The strengths or weaknesses of the companies are not as important as the current financial trends within the particular market.

Trend following is all about the different strategic moves needed to make a profit in the market. The moves will depend on the current trends and the effect on the market. A day trader can utilize a market for short, medium or long term moves. By analyzing the market atmosphere, a day trader can determine if the stocks will continue to rise for a gain or fall for a loss.

Trend Fading

Trend fading is considered to be a risky strategic approach to day trading. When this type of strategic approach is done correctly, the payout or profits can be high. The trick in trend fading is the ability to know when to sell or buy.  In trend fading, you are taking a risk against the main trend which numerous others could be following. A day trader would actually sell the stocks while the price is rising in hopes the trend stops. When the trend stops rising, begins to fall the strategic approach has been a successfully implemented.

The day trader could also use trend fading to purchase the stocks as the prices are falling.  Other day traders may be quick to sell stocks if the value declines. The strategy behind the falling price purchase is the hope the stocks will turn around; going against the prevailing trend. If the lower priced stocks rally after a considerable decline; the result would appear in a larger profit margin.

Scalping

Scalping is a strategic move involving immediate turnaround. The strategy involves selling the stocks right after the value rises from the trade purchase. The quick selling of the stocks that are showing a profit is a limited price change. The theory behind this strategic approach is smaller, profitable moves will gradually catch up to any type of larger profitable gain.  Scalping often helps in preventing larger losses.  The quick selling is an exit strategy when the stock values start to decline.

When applying the right strategic approach, a day trader can make profits through the buying and selling of stocks. Using the strategic approaches to the day trader’s advantage will result in profits.  You still may be asking yourself what is a day trader; the simplest answer is a person who purchases and sells stocks in hopes of a profit.  The critical details of the strategic approaches to being a day trader makes the job more complicated.  The complications may result in a large payout.

 

Day Trading Strategies – Basics

Day trading can be a path to financial independence, but it needs to be undertaken with proven approaches that support strong decisions. Whether you’re new to the financial markets or you’re already an experienced investor, it’s essential to leverage time-tested day trading strategies that can lead to success.

Trend following, fading and scalping are three examples of such strategies. Before you begin your day trading endeavors, you should learn how to apply these approaches with confidence, day in and day out.

Day Trading Strategies: Trend Following

Trend following draws on historical patterns. It uses average stock prices, as tracked over a period ranging from several days to several weeks, then uses those trends to make entry and exit decisions. By definition, day trading has a very short entry/exit horizon, and as such, it’s vital to predict ebbs and flows with as much accuracy as possible.

However, it’s important to remember that there is no single indicator which will always work in every single case. Traders who have mastered the art of trend following tend to use one or more of four specific indicators to identify stocks that have the greatest likelihood of generating a favorable return. Those indicators are:

  • Moving averages. This approach uses specifically determined time frames to pinpoint a stock’s average value over a given period, then identify when it has risen above or fallen below that average. These insights help day traders determine which stocks are likely to move up or down in the days ahead.
  • Moving average convergence divergence (MACD). MACD is used to determine a given stock’s momentum, which can be upward or downward. It uses a 0 value as its baseline, and MACD analyses that return a value above 0 usually signal upward momentum, while those returning a value below 0 typically indicate a downward trend.
  • Relative strength index (RSI). RSI analysis assigns a value between 0 and 100 to a given stock, aiming to identify when a stock is being overbought, and thus overvalued. Stocks that are overvalued usually fall or “correct” in value, and RSI scores of 70 or higher tend to indicate that such a correction is imminent.
  • On-balance volume (OBV). Trading volume can be a very valuable tool in predicting where the price of a given stock is heading. Generally speaking, rising OBVs correspond to upward-trending prices, while falling OBVs indicate downward-trending prices.

Day Trading Strategies: Fading

Fading is a high-risk, high-reward strategy that seeks to capitalize on rapidly rising and falling prices. Also known as “fading the market,” this approach sees investors buy a stock when its price is going down in the hopes of earning a profit through a subsequent rally, or rise, in its value.

Day traders may also use fading to try to fill market orders in other indices that brokers cannot or will not match. This is a more advanced approach, which requires significant experience to master.

Day Trading Strategies: Scalping

With scalping, investors try to extract or “scalp” many small profits by making a large number of safer trades within the space of a single day. In day trading, scalpers can capitalize on price fluctuations of just a few cents, or fractions of a percentage point, by buying and selling large volumes of shares. Scalping requires a rigid exit strategy, demanding that investors leave positions quickly once they’ve earned a small profit.

If you’re interested in learning more about these day trading strategies, Markus Heitkoetter of Rockwell Training offers both basic and advanced instruction in these and other proven tools. Investors of all experience levels are invited to benefit from his expertise.

A Review Of Rockwell Trading Free E-Book- The Simple Strategy

The Simple Strategy by Markus Heitkoetter is a book that provides a step by step trading plan for trading stocks, futures, Forex and ETFs. It offers a simplified approach to trading where traders can learn important things such as how to make money even if half of their trades are losing trades, setting up their charts, when to enter or exit a trade, the right places to put their stop loss, the best time to take profits and so much more.

There are a lot of graphics and charts that have been used in the book to help the readers understand every point and implement it. Traders do not need to buy any expensive charting software or proprietary indicators when they have this book. All that is needed is a charting software that has essential charting capabilities such as ability to plot MACD, Range Bars, RSI, and Bollinger Bands. This is quite encouraging considering the fact that more than 90% of the charting software available nowadays have these capabilities.

Markus Heitkoetter brings a fresh approach to the topics and subtopics under every chapter. For example, Bollinger Brands is an indicator that has existed for quite a while now but very few people knew it could be used as dynamic trendlines. This unique approach is what makes the book stand out by providing a new way forward for traders in the industry.

The Simple Strategy has been written to suit all types of traders including professionals and amateurs. It tells them how to take the best advantage of intra-day trends when trading. Nowadays, traders face numerous challenges especially after the arrival of computerized trading and low trading commissions, but any challenge can be met and conquered by reading this book.

At the beginning of the book, Marcus narrates his own inspirational journey to success as a trader. He explains how he felt frustrated at one point of his life as a result of what he calls Analysis Paralysis, which occurs when traders plot so many indicators on their charts that they can no longer see the price action. Instead of using so many indicators, the Simple Strategy provides only three that can be used to make all the trading decisions needed.

The Simple Strategy offers a comprehensive guide to day trading from a renowned trading coach to help even the most inexperienced trader learn the dos and don’ts of this exciting profession. More information about this book can be found at the official website of Rockwell Trading.

Online Trading with Rockwell Trading

Buying, selling and exchanging goods and services can be exciting. Perhaps it is the accomplished feeling that boosts mood, understanding possibility is accompanied with perseverance. This is why Rockwell Trading, a company based in Austin, Texas, thrives in the industry.

Over the years, trading has evolved. What was once an activity of hyper go-getters has now moved to cyberspace and the trading of shares and stocks takes place in real time. Today, interested investors can easily make decisions in the comforts of their own homes and evaluate the impacts of their trades and exchanges. In the dot-com age, the stock market is no longer open to just a select few, being that even the lines between investors and brokers are thinning.

Trading is not just a one-time deal. It is only suitable to individuals who pay attention to detail. The most important thing about trading is to follow-through. It requires dedication and careful study. Still, a dollar risked in the market may either be a gain or loss. At the end of the day, it is all about the decisions an investor arrives at, supported by technicalities and analysis.

Trading provides quick, short term profits and can be done consistently. Thus, it takes small, short term gains before a novice can attain on a larger scale. Sometimes it is safe to say not to marry a stock, but to marry the idea of making money through trading stocks.
Trade only with a clear advantage which will set apart the odds. This is also one reason why most novice traders lose money. One way to determine this is to take a look at a daily chart of a stock index, the volatility will spell out opportunities.

Patience counts. The conventional wisdom also comes in handy and that is to wait at least an hour before beginning to trade. However, this is not always applicable since the big moves made by stocks are usually shortly after opening. It is sometimes a fraction of time that ushers in fast and large profits.

Learn from the work provided by those who are well-experienced in this business. By determining the time and manner of how they trade, it could lead to profits when least expected. Remember the market is constantly changing, whether going up or down. No one can ever determine how stocks behave because there are always various factors that can affect values, therefore always trade within adequate means.

Starting to Day Trade with Rockwell Trading

Day trading is an attractive profession to many, although it can be difficult and unpredictable. Many people want to venture into the world of day trading, but they’re not really sure what to do. To get started in day trading, experts recommend having the right mindset before anything else.

Day traders need to be fully prepared for each trade. They have to know that there are chances of incurring some losses. However, they shouldn’t give up easily. Moving forward is a crucial part of day trading, which can be frustrating at times. Those who encounter a bad trade should release it from their mind and move on to the next one. There’s always a possibility of winning the next trade. In the long run, those traders whose wins make up for the losses are able to generate money.

Experienced traders suggest getting education about day trading to increase chances of getting higher profits. This means reading books, subscribing to magazines, going to trading classes, doing research online, and gathering plenty of helpful information from resources provided by seasoned traders. It takes in-depth knowledge for day traders to choose effective strategies and methods.

Those who are serious about trading should absorb lots of information in order to understand the ins and outs of day trading. It’s important to decide on a good trading strategy that best fits a person. Different traders may have varying strategies that fit them well. Some people go for short-term trading, which refers to short, quick trades that result in small profits, while others prefer swing trading, which focuses on significant shifts in the market.

Rockwell Trading is a company that offers useful resources for day traders. The company’s founder and CEO is Markus Heitkoetter, a seasoned day trader and the author of “The Complete Guide to Day Trading” and “The Simple Strategy.” He founded Rockwell Trading in 2005 with the goals of simplifying the world of trading and helping people reach their trading goals.

The company offers trading strategies that are ideally suited for beginners. These strategies are effective, simple to understand, and easy to execute. Aspiring traders can learn the strategies in a short period. Markus and his staff also offer strategies and concepts for experienced traders who are searching for new trading ideas.

Aside from eBooks, Rockwell Trading offers courses and DVDs. Markus assures customers that they will receive quality education, and he and his team of traders will help clients attain their trading goals. His day trading courses include “The Power Crossover Method,” “Rockwell Trading Club,” “The Ultimate Trading System,” “Five Trading Strategies Bundle,” “Rockwell Trading Indicators, and the “Personal Coaching Program.”

Start Day Trading Using Rockwell Trading

Rockwell Trading is a website that provides information on how to start day trading. The site offers a free eBook entitled, “The Simple Strategy.” The eBook is available to site visitors by entering some basic information, such as their name and an email address. The website also has seven day trading courses, and these courses are designed to make trading simple and rewarding at the same time. The names of the courses, along with the eBook, are available by accessing the website at, http://www.rockwelltrading.com/. One of the links at the top of the page, “Day Trading Courses,” is a drop down menu that provides a list of the courses.

Two courses prospective traders might find interesting are “The Ultimate Day Trading System,” and the eBook, “The Simple Strategy.” Both provide information on a systematic approach to trading, and provide advice relating to:

– The best markets to trade
– The best way to set up a chart
– Three of the best indicators for trading
– How to identify where a trend starts and where it ends

Markus Heitkoetter, the owner the company, Rockwell Trading, indicates that a simple strategy is the best strategy. His eBook provides clear rules for market entry, provided by indicators such as Bollinger bands, Moving Average Convergence Divergence (MACD) charts, and Relative Strength of Indicator (RSI) charts.

The website is easy to navigate, making it simple and user friendly for all people, whether they’re experienced or novice traders. There are a number or workshops available in the members’ area of these site; these include live trading with Markus. The video for this workshop has 11 parts; however, it can also be viewed as a full workshop. There is also a 12-minute video; short, sweet, and to the point, for users who are in a hurry. The 12-minute video indicates what others are doing in the trading world, and what can be done to get ahead of the competition.

Rockwell and Online Trading

When most people think of stock trading, they think of the Stock Exchange. Every large country in the world has its own stock exchange, and for the United States, it is located in New York. Just a few decades ago, anytime someone wanted to invest in or sell stocks, they would have to contact a stockbroker and have that person conduct the purchase or sell of those stocks. Today, with online trading, that is no longer necessary.

Stocks are shares that individuals can purchase to be an owner in an organization. In exchange for their purchase, they receive dividends based on company’s profits and how many shares of an organization they own. The average person who chooses to purchase stocks usually does so in smaller companies that are less expensive to invest in. This will lower the amount of dividends a trader will earn, but it is the better way to go when first learning to trade.

For those that are not certain of their ability to trade in online stocks successfully, there are four different types of stockbrokers that one may choose. These are online/discount brokers, discount brokers with assistance, full-service brokers, and money managers.

Online brokers simply take requests from clients to purchase or sell stocks, without offering any advice regarding the stocks. If you want to get a minimal amount of advice, then the better choice is to choose to work with a discount broker, while full service brokers will often sit down with their client to discuss what they want to gain and how much risk they are willing to take when investing. They will also offer other services, such as estate planning, retirement planning, and tax advice. Money managers are extremely similar to full service brokers, except they manage the money completely, and they are often paid fees for the management of these funds and investments.

Online trading has opened up a world of investing via a number of websites, such as Rockwell Trading. Rockwell Trading, founded by Markus Heitkoetter, is a website with various forms of education on trading in the stock market. Some of these include a free e-book, as well as several courses you can pay for to get further instruction on investing in the stock market.

The website also offers online workshops that one can take to learn further about stock market trading. By choosing to invest in this website, you can learn the ins and outs of the stock market, such as how to predict what the market will do next, with guided training to ease the transition into the trading world.