At the very beginning of learning trading, many beginners try to trade inside the day. They have a feeling that by trading on intraday activity, you can earn more and get more experience, gain it faster.
This is only partially true about day trading rules. Trading within the day does not always allow you to earn more. Most often, the results of trading scalpers and long-term traders do not differ much.
As for experience in day trading rules, a trader will indeed make more trades when trading inside the market than if they were trading long-term strategies over the same period. But transactions within a day immediately require special attention, concentration, speed of decision-making, and a certain experience and understanding of market mechanics. A beginner has the risk of making a lot of mistakes, rooting them, and even losing money if he uses wrong sec day trading rules.
How to use the rules for day trading
Price Action
This is not just a trading system, but a trading philosophy, a trading approach among forex day trading rules.
This type of pattern day trading rules uses graphical analysis tools to search for areas on the chart where there may be a trader’s interest, and some movements or price changes will begin. When searching for such areas, support and resistance levels, trend lines, and other tools are actively used to find areas where entry or exit points may occur.
But finding such areas is only half the battle in such day trading rules. Then you need to price behavior, her reaction to these zones, to determine if there is interest among traders join if the new volume is there any chance of moving.
Another rule uses two simple moving averages: one with a period of 10, the other with a period of 200.
In addition to moving averages in such day trading rules, you need to plot historical support and resistance levels.
Entry occurs at the close of the daily candle. We enter the trend, buy from support, sell from resistance.
In determining the trend and direction of the current wave, a moving average with a period of 10 helps. When the price crosses in one direction or the other, a special indicator indicates this with arrows.
Also, there is another rule. It is very simple to trade on it and one of the best day trading rules. A channel of two moving averages with a period of 5 is plotted on the price chart, one of which is plotted at High prices and the other at Low prices.
When a bullish candle has opened outside the channel but closed inside it, above its lower border, then a buy trade is opened.
In such day trading, you need to sell after the bearish candle has opened above the channel and closed below its upper border.
Peculiar features of the pattern day trading rules
Generally speaking, Forex rules on daily charts have the following advantages.
Low emotional load.
In contrast to trading at lower intervals, where the price changes sharply and often, and you need to make quick decisions, process a lot of information. And all this with frequent transactions, when one by one, there may be disadvantages of day trading options rules that will put a lot of pressure emotionally.
Low time costs.
An hour or less may be enough to analyze the market situation and track changes per day. The trader does not sit all the time in front of the charts, does not overload himself with market information. In such day trading strategies for beginners, his view of the market is fresh, not clogged with noise. And the decisions he makes about the rules for day trading are more accurate.