Learn more about day trading

Grand Capital continues a weekly series of educational articles — we are happy to give you the best trading tips, helping you to learn anything that powers you to make more profit. Today’s topic is day trading also known as intraday — a trading style where you buy and sell assets over a trading day.

Unlike the previous scalping trading style, day trading does not necessarily feature quick 1–10-minute deals, neither it can be called a long-term strategy. This strategy is usually used by short-term traders who are looking to make a quick profit. You will need to open and close your trades within the same day. This means that you will need to monitor the markets closely and make decisions quickly. Check out our overview of trading styles to know what to choose from!

To meet these conditions, you need a reliable trading platform like Grand Capital. Use our new web terminal with technical analysis features and strong mobility. It is best if you need to change locations during the day and continue trading even using different devices. Our terminal adapts well to all those circumstances.

Technical analysis in day trading

Day trading style rarely requires many technical analysis tools. Successful day traders mostly tend to use candlestick charts to identify support and resistance levels and thus, the market trend. For this type of trader, the previous day’s high and low levels are key for planning their trading day. This is purely logical: the high, where the market decided that the asset is overbought, identifies the possible maximum for the next trading day. And otherwise: the lows of the previous day may identify the further possible minimum.

Of course, with this type of day trading style, you will need to use a stop-loss. This is an order that you place with your broker to sell your position if the price falls to a certain level.

This ensures that you do not lose more money than you can afford to. You should also have a take-profit order in place to close your position and fix profit automatically once it reached the supposed target.

Day trading example

This is a position done by a trader following our trading ideas. As you can see, it lasted only a few hours and made our fellow $836 of profit. The open price was 1848.05, the close was 1865.41, and the volume was one lot. Roughly 8 dollars of a price difference resulted in 100x greater profit — this is because one lot of XAU/USD equals 100 ounces of gold. The trader used take-profit in this case but neglected to set a stop-loss. We always recommend placing both orders for safety reasons. That’s why every trading idea has both S/L and T/P.

Create a Grand Capital account and try these tips! We hope this trading style will lead you to a great profit. Follow our Telegram channel to learn about other trading styles! Good luck!