Home > Beginner education > getting the sequence correct when day trading

getting the sequence correct when day trading

Day trading often has the frenetic quick paced action most people associate with the internet boom. Most charting packages give you the choice to create a chart that can go all the way down to a “tick” chart. This is basically creating a chart that is formed from every print in time and sales. When traders do this it is for one reason and one reason only, to minimize risk.

The shorter the time frame the tighter the stop losses will be. This type of trade analysis creates many many trades with a one to one risk reward scenario. generally speaking the shorter the time frame you are identifying a trend or entry signal the more often you will be forced to trade. This is because on those short time frames the trend will change frequently.

I am not saying this time frame is wrong to look at, what I am saying is that if it is the ONLY time frame you are looking at you will be missing out on some “easier” bigger profits. Before you zoom down to the shorter time frames to enter a new trade, you should always develop your ideas on the higher time frames.

There is no reason to look for an entry if the scenario is not obvious. Too many traders focus on where to get in to a new trade when the real focus should be “is there an edge?” That edge is found on the higher time frames. make sure you get the sequence correct for bigger moves (even if you are only scalping!)

Throughout our discussions with the thousand or so inquiries we get per month, it is quite common for us to hear someone tell us, how successful of a trader that they were in the late 1990’s, that they left the business and now would like to get back into the business of day trading, with Keystone’s capital.  They expect that we will impressed with their trading track record which is over 10 years old.

That being said, we felt it is important to conduct a webinar series on the differences between day trading in the late 1990’s and day trading in the year 2009.

We invite you to join us on Thursday June 4th for an Online, Live Webinar which will begin at 6pm EST. We will break down what we feel to be the biggest differences between trading in those 2 time periods.

Click here to register for the event.

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