There are 3 basic mainstays or basics underlying all day trading rules: the Strategy, the Psychology and the Risk Trade Management. Below are some day trading rules that are worth paying attention to.

A persons mental attitude has a large influence on day traders. One needs congruity in one’s mind since the market is largely a random walk and you’re in the fight and need to be alert and ready to act reasonably. When the market does signal a set up, you need to be cat-like, ready to pounce.

Anyone active in the market will tell you, one needs patience till the correct set of circumstances develop and then to pounce on it. One needs to hold tight till the right moment and then act without question. You need rules to follow so you can work the setups.

All day trading that is successful, is a game of not making mistakes and keeping one’s losses to a minimum. Traders need to cut out any chance for big mistakes. Everyone who wants to succeed in this game needs to be disciplined and not violate any of their rules. These rules are the result of individual trial and error back testing and verified personally by the trader.

In order to avoid capital loss, always set buy and sell stop orders on any position taken. Pass on the trade if the risk is too large. Use a trade simulator to work out all the bugs and test your strategy before you go live.

Mentally, one must be awake and not emotionally stressed. A clear headed mind is important in order to make decisions and act on them without emotion. Having the experience to control ones emotions helps in order to bounce back ASAP after losing trades. One needs to cultivate the confidence and a winning spirit based on fact to trade without great swings in emotion.

Be sure you keep an active log of your trades for later reflection. This is a way to hold yourself accountable. You need to record how you felt and what you were thinking when you made the trade. What indicators you used and how the trade developed. In retrospect, you’ll have a log that you can refer to and self-diagnose for trends or inconsistencies. You’ll get a birds-eye view that allows you to see if your strategy is working or not and, most importantly, why.

One needs a clear theory and objective to be able to work and to work with Trade with a set of rules that are solid winners! You might want to keep a encapsulation of your day trade strategy on index flash cards so you can review the system as necessary before committing to a trade, especially if you are in the learning phase. Back testing your theory is extremely important. One needs to back test and have confidence based on fact. Finding good day trader software may be extremely helpful and add a new direction to your trading.

Money management rules need to be fixedly adhered to. Never risk more than 2% on any trade. Without proper equity management new traders are tempted to take risks far out of proportion to the amount of equity they have in their account. By using strict money management rules, you can even make money losing 50% of the trades you make.

Trading can be a very prosperous career choice. Those who are successful have sound money management strategies, a winning theory and are emotionally well balanced. There are those who trade multiple markets, even a day trading stock tip may prove workable with a good strategy.

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