Essential Day Trading Tools

Even when you are in possession of all of the relevant day trading information and tools, day trading is a rather difficult craft to master. At the very least, a trader should always have the proper day trading tools with him or her during trading hours. These tools allow a trader to make decisions based on factors that he can control: timing and confidence. Think of a pitcher. Once a pitcher releases the ball, he no longer has control over what happens. What he has to focus on are the things he can control: stance, grip, speed and the like. Having access to the proper day trading tools is a trader’s version of having the proper stance, grip and accuracy before throwing a pitch. 

Using the Right Platform
 The essentials needed are a computer, a trading platform, and access to current financial news for all U.S. equities. A superior trading platform will provide direct access to the market, up-to-the-second equity pricing information, and seamless entry/exit of trades. Many of the more sophisticated platforms do charge a monthly fee, and these platforms usually include access to the open book (which shows the upcoming bid and ask prices in the order of best prices/nearest fills), most recent order fill history, and some form of charting software. 
The Importance of Technical Analysis
The charting software included in the trading platforms themselves are often limited and do not allow for complex technical analysis. It is often useful to purchase a separate interactive charting software package. With advanced charting software, it becomes easier to incorporate technical measurements, such as moving averages, MACDs, stochastics, bollinger bands, relative strength, and candlestick patterns. Understanding how to read these technical measurements can only improve the accuracy of your trades, and while no one indicator is a crystal ball, the more information the better. 
Developing Good Trading Habits
Successful trading also requires strong mental tools as well. In order to consistently extract profits from the market, traders have to be ready to trade before the market opens every morning, and must adamantly stick to pre-determined trading rules. Consistent routine will help develop good trading habits. Strictly following trading rules at all times is difficult amidst a constantly changing market where emotions often dictate price fluctuations and hidden orders cause spontaneous and unexpected movements.  Thus, one of the most important tools to acquire is an indifferent mind when trading, void of emotion. 
Using Different Strategies 
A well-developed routine, efficient use of stock price information, and good timing coupled with a little luck, are the tools necessary to become a successful day trader. Timely uses of stop-loss orders can also be beneficial. It is important to remain adaptive when trading and to use different strategies in different types of markets as well. In a smooth trending market, much like the one we experienced in the mid 2000s well timed cost averaging proved to be a great way to build large positions at favorable costs. In a choppy, seemingly irrational market, however, it becomes harder to cost average, and adopting a well-defined risk/reward trading style may perhaps be the better method of trading.  Day trading is a difficult craft to master, even when in possession of all of the relevant information and tools. At the very least, a trader should always have the proper day trading tools with him during trading hours. These tools allow a trader to make decisions based on factors that he can control: timing and confidence. Think of a pitcher. Once a pitcher releases the ball, he no longer has control over what happens. What he has to focus on are the things he can control: stance, grip, speed, and the like. Having access to the proper day trading tools is a trader’s version of having the proper stance, grip and accuracy before throwing a pitch.

Using the Right Platform

The bare essentials needed are a computer, a trading platform, and access to current financial news for all U.S. equities. A superior trading platform will provide direct access to the market, up-to-the-second equity pricing information, and seamless entry/exit of trades. Many of the more sophisticated platforms do charge a monthly fee, and these platforms usually include access to the open book (which shows the upcoming bid and ask prices in the order of best prices/nearest fills), most recent order fill history and some form of charting software.

The Importance of Technical Analysis

The charting software included in the trading platforms themselves is often limited and does not allow for complex technical analysis. It is often useful to purchase a separate interactive charting software package. With advanced charting software, it becomes easier to incorporate technical measurements, such as moving averages, MACDs, stochastics, bollinger bands, relative strength and candlestick patterns. Understanding how to read these technical measurements can only improve the accuracy of your trades, and while no one indicator is a crystal ball, the more information, the better.

Developing Good Trading Habits

Successful trading requires strong mental tools as well. In order to consistently extract profits from the market, traders have to be ready to trade before the market opens every morning and must adamantly stick to predetermined trading rules. Consistent routine will help develop good trading habits. Strictly following trading rules at all times is difficult amidst a constantly changing market where emotions often dictate price fluctuations and hidden orders cause spontaneous and unexpected movements. Thus, one of the most important tools to acquire is an indifferent mind when trading, a mind unswayed by emotion.

Using Different Strategies in Different Markets

A well-developed routine, efficient use of stock price information, and good timing coupled with a little luck are the tools necessary to become a successful day trader. Timely uses of stop-loss orders can also be beneficial. It is important to remain adaptive when trading and to use different strategies in different types of markets as well. In a smooth trending market, much like the one we experienced in the mid 2000s, well-timed cost averaging proved to be a great way to build large positions at favorable costs. In a choppy, seemingly irrational market, however, it becomes harder to cost average, and adopting a well-defined risk/reward trading style may perhaps be the better method of trading. 

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