Competent approach to intraday trading
Starting your career as a trader, first of all, you should decide which type of trading suits you: swing trading or intraday trading. It is recommended to start with the latter option, because it allows you to use a larger leverage and is simpler.
What does an intraday trader need to know for effective work at the exchange? Strangely enough, quite a lot, and it concerns not only market analysis and the use of various strategies and tactics.
The right time to trade
Why do I need this information? Firstly, in order to choose the most suitable time for trading. This moment may seem unimportant at first sight, but the difference is quite significant. But it is necessary to pay attention not only to the trading time, but also to the currency pair.
Marketplace works 24 hours a day, but this does not apply to the interbank market and the work of financial institutions, so there is a relative lull in the virtual market as well.
In addition, the trend slows down its movement on currency pairs not related to the current session. For example, GBP/CHF behaves relatively calmly at the Asian trading session. Which is good for a beginner and not quite suitable for a scalper.
The market starts with Australia and Japan; this is a rather calm time for European currencies and a burst of activity in currency pairs, which include the yen and the Australian dollar. It is not a bad time to open trades in EURUSD, there is not much profit to be made but the possibility of losses is considerably reduced. So, get up early (4 am to 7 pm Moscow time) and start trading.
For those who like to work at night, a similar period is from 23 to 01 at night.
The main thing is to stop in time
But not all traders prefer quiet trading, some prefer risk and high stakes, in this case we act the opposite.
Choosing the most volatile currency pairs and start trading at the time of the highest market activity. Usually it falls on the period from 16 to 21 hours, Moscow time.
In addition to large profits here you can expect sharp jumps in exchange rates in the opposite direction. Therefore, the probability of triggering of stop-loss orders increases, and if they are not set, then the deposit is also lost.
Do not forget that when trading intraday, the main thing is to stop in time, and the best time to exit is not at the end of the day, but an hour or more before the end of the trading session in which you opened the trade. The factors affecting the exchange rate may also change with the transition to another trading floor.
Also, if you use a leverage of more than 1:100 you should not expect maximum profits, the exit should be made at the first signs of a reversal or pullback, not when the stop order is triggered. In this case, you should not forget about the reasonable management of funds, not more than 20% per transaction.
In general, intraday trading is an excellent chance for traders with a small deposit to earn at least some profit. Its competent use allows to earn even with the sum of $100 and more, gradually increasing deposit and trade volumes.