Mistakes of Day Trading Routine
Some mistakes of day trading happen in the trading routine due to too much information is coming in at the same time, and you feel overloaded/aggressive/panicked, or they often happen during quiet/bring times when your defender is down. There are always some mistakes of day trading, such hitting the wrong button buy instead of sell or putting out the wrong position size.
Before trading, every day takes few minutes to go through a day trading routine that helps to reduce errors throughout the day. Depending on the market you trade, you may want to add some additional steps in your trading strategy. This entire process only takes a couple of minutes but saves your lot of failure and money.
Avoid 8 Mistakes of Day Trading Routine
1. Economic Calendar
High impact economic events can affect price gaps/spikes, creating important slippage (difference between price you expect and price you get) on stop loss orders. It’s best to avoid being in trades for some minutes surrounding high impact scheduled news event. Check your economic calendar before you do trading, and note the high impact news times.
Click on below video: Trading Without a Stop Loss
2. Launch Platform
Launch your trading platform. Make sure quotes are streaming, and the program is running efficiently. Most forex brokers provide you with reliable data supplies, but problems can occur if the data feed is intermittent or looks inaccurate, don’t trade until the issue is fixed. If it seems right, proceed.
3. Trading Correct Account and/or Contract
Make sure you are trading the correct trading account. Be especially alert if you practice day trading in a simulated account, but also have live trading accounts. You don’t want to have a great day, to realize you traded in simulation instead of with real capital. If day trading futures, make sure you are trading the correct highest volume contract.
Click on below video: How to Open a Forex Trading Account?
4. Write Text Notes to Yourself
On your chart, put text notes stating when the high impact news releases are. If engrossed in a trade you may forget about one of these events, and it could cost you much. Write it down on the chart. If the event happens later in the day, scroll over and put the text note near the estimated time of the decision. That way you will see it when the time arrives.
5. Position Size
If you trade with a default position size, make sure it is set suitably. Adding an extra digit to a trading position size could spell disaster. Dropping a digit means you traded a fraction of what you could have, and you missed out on a trading opportunity.
Click on below video: Position Sizing
If you manually adjust your position size based on stop-loss locations and entry point, note your account balance before doing trading. Proper position sizing limits risk to a small percentage of account capital, such as 1%. If you have a $35,000 account, you can risk up to $350 on a trade. Keep the maximum risk in mind during the day to remind yourself this is the most you can risk on one trade.
6. Make Condition
Make a quick assessment of trading conditions is so far. Is the pre-market showing a lot of volatility, or is it sedate? Is there a trend or particular tendencies you notice?
Such an assessment lets you know how to proceed, and whether you should be the trading system at all. This is especially important if using a subjective system a system that varies somewhat based on market conditions.
Click on below video: How to trade Forex during tough trading conditions?
7. Start Trading
You are set to trade. This process should help to eliminate mistakes related to position size, to buy and sell the wrong account/contract, trading during news or just not be preparing the mind to trade.
As you start looking for potential trade setups, keep the key trading thoughts in mind. It will help keep you out of bad trades and keep you alert and ready to pounce on good opportunities
Click on below video: How much can you make in Trading Forex
8. Create End Time
If you see the time of the day you trend to give back profits on a routine basis, write a journal to yourself to stop trading at that time. Many traders tend to lose money in the time surrounding in the new york lunch hour if trading U.S. trading markets. Stop trading during segments of a day you typically lose money. Remind yourself of this when you begin trading every day.