Day trade vs intra day trade vs swing trade

Beginner Questions
1

I was curious to learn how other traders in the BP community decided on their own personal trading strategy. As well I’m interested to hear what you believe the pros & cons are of each strategy, in addition any sort of practices that may be done in strategy but not the other.

Right now I’m just a beginner, so I’m trying different strategies to see what works for me. As of now, day trading or positions that last 1-day or less seem harder to read & predict.

At the moment I like taking longer positions, but that’s primarily because it’s easier to read the charts and I fundamental analysis of economic & political news (something I stay up to date on) will play more of a role in a long-term position.

that being said, I’m still a newbie, and wanted to hear other peoples opinions on what they think of the various strategies, how you approach your trades and so on and so forth.

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2

I find its easier to read the charts on a D1 time-frame, and certainly easier to find favourable set-ups. These are vastly more important than entry patterns, any fool can see a bar shaped like a T. Multi-day chart features on a D1 time-frame are more significant and therefore less unreliable. And of course you have longer to consider and make decisions.

As I see it, if a trader can’t make money trading D1, how can they expect to become a great 5-minute scalper?

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3

The higher the time frame, the easier the market becomes to trade…

…but the longer you need to sit in your trades and the higher capitalised you need to be to make it worth your while. Of course, trade intraday, you can conceivably make good returns on a much smaller account…but it is much much harder, and you are stepping into the world of algo dominated price action. Algos, that know how the ‘educated’ retail trader thinks, that know how to lure him into trades, and know where is stop loss orders will be.

If you are a complete beginner, I recommend intraday trading on a DEMO account. You will learn faster that way. Better waiting 45 minutes to see how a trade plays out than 4.5 weeks, until you ‘git gud’.

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4

These are very good and sensible issues that you are considering. Simply put, people can trade successfully on any timeframe and with a huge range of strategies and approaches. But the reality is that the vast majority of traders do not make money whatever style they use!

Selecting one’s trading style is a very broad subject and is moulded by many factors. To start with there are your personal circumstances such as available capital, employment obligations, what time zone you live in, etc. Then there are you personal characteristics such as your ability to concentrate, maintain discipline, manage stress levels, etc. In addition to that, there are your personal interests in how you wish to trade. If you are interested in including fundamental analysis then longer term trading is more suitable. Afterall, government and central bank policies do not change hourly! But if you are interested in technical analysis then you can adapt this to suit any timeframe.

Intraday trading surely requires greater stress management, discipline, patience, and self-control. Longer term trading off daily charts, for example, allows greater strategic planning and potentially good results from long term trends. But that is not always quite so easy either since markets can move a long way in a day and if you happen to enter on the “wrong” day in the “wrong” direction then it can be very painful. This type of trading also needs greater room for the trades to “breathe” as the moves unfold and therefore you need wider stops and a greater level of capital in your account.

Then there is the choice between discretionary trading, where you personally evaluate each trade set-up before actually entering (and while it is still open), and (semi)automated trading, where you follow the signals mechanically and rely on the historical success of the method to produce a net gain over time.

Yet another major issue is whether you wish to trade for a full-time income or alongside your employment to earn capital for investment in other things such as a pension scheme or a share portfolio, etc. It is an entirely different world if you need to trade to pay the bills every month regardless of the market compared with just waiting for opportunities to trade and add to your capital whenever they happen to appear (and is not a major setback when they sometimes go wrong!)…

Some people are happy to carry open positions for long periods, whilst others prefer to trade on days when they feel ready to trade and/or they see something worth trading. One problem often stated by longer term traders is that they become “married” to a view or opinion even when the market is saying the opposite. Short term traders, by definition, are never hooked on a long term trade or view. But the corresponding problem here is that it is a rather contrarian human characteristic to swing rapidly from one direction to another and trade without logical reasoning behind it.

So, although you will get good comments here from other traders, ultimately you have to look within and see what suits your personality and circumstances best. it is good to trial these things on demo freely and see how it evolves.

You are clearly making the right moves here and I wish you good luck all the way! :smiley:

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Whatever the formula, I like to do long-time trading. This strategy helps me to be relaxed and calm.