When most people think about day traders, they think of risk taking, shoot from the hip kind of people. People also think that while a small percentage are absolutely filthy, filthy rich, most end up losing their shirts on the markets. For the most part, these legends hold a certain degree of merit to them.
If you’re interested in becoming one of the successful day traders, you need to understand and hold tight to the same disciplines and strategies that these traders use every trading day. Without a doubt, the top reason why so many potential day traders end up in bankruptcy and heartbroken is not due to a lack of the proper strategy or strategies.
The main pitfall of day traders is their lack of discipline. This might not be the first time you heard that statement, but none the less, it’s painfully true. Some get angry at people who publish their stock trading systems, saying they’re only out to make a buck and their system doesn’t work. While this may be true of some stock market “gurus”, most successful day traders who have authored and published their techniques have tested these systems in the fires of the markets.
Lately, it seems that a lot of day trading personnel have been interested in the forex markets. While the forex can be made into a nice cash cow, all a potential day trader needs to do is focus on the stock market, implement a strategy and stick to it.
What about stock market software? Software used by day traders is a necessity. However, in most cases your brokerage firm will provide you with some sort of online trading platform absolutely free with your membership. Being the necessary tool in the belt of the day trader that stock charting software is, it is by far, not the only thing needed to be successful.
For example, let’s say I have the most advanced, up to date stock charting software on the market. However, even though I can get up to the minute, accurate stock prices (even level 2), if I don’t know exactly what to do or how to react to those price falls or jumps, what good is the software? Not much good at all.
What you need to couple with your online brokerage service and stock charting software is an excellent trading strategy. Once you have a trading strategy that you understand, you can start to implement it with paper trades. When you are starting to make profits on a consistent basis, you can switch to real investing and watch your bank account get really, really fat.