While day trading is neither illegal nor is it unethical, it can be highly risky. Most individual investors do not have the wealth, the time, or the temperament to make money and to sustain the devastating losses that day trading can bring.
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No trading is completely okay if you have strategies that suit for day trading. It’s all about skills and experience.
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Yes, you can earn or lose in Day Trading, but even loss makes you gain something valuable and it is the experience, with which you would be able to survive for a long run.
Trading is risky and so are trading strategies. There is no trading strategy that can not be relate with risk. Day trading is a really good trading strategy if you can manage the risk properly and follow your trading plan. There is nothing wrong with this.
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Please provide an example. There are lots of people who day trade and are profitable. But, it’s not for everybody. Certainly not for me.
However, that doesn’t mean it’s not profitable.
What do you mean by “Devastator”losses?
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I’m only bewildered how anyone can do anything else !
Anything over a 15 minute chart puts me into a catatonic state.
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They look like this
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Nothing at all. It depends on your psychology
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You might have missed the market trend and you would be able to improve your trade, if you have learned regarding several skills required to earn money.
There’s nothing inherently more risky or dangerous about day-trading except the beliefs of new traders. New Traders believe it is easy and almost risk-free, and that this approach to trading makes it possible to gain a desirable daily income.
New traders’ beliefs make day-trading dangerous, and they should not be sent anywhere near it.
Hahahahahaha
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Since the FX markets don’t close during the week, day trading has never really made much sense to me. Other than a small fee for holding overnight, trades take time to play out. Certainly nothing wrong with it, if you have a good strategy, but otherwise I believe it limits your potential for profit.
On that same note, I guess it limits your losses too.
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I think that’s probably the main reason day traders do it - the instant gratification-ness of it all.
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Traders sometimes become reckless and it leads them to their losses. But, they could rise if they learn from their mistakes and avoid them in the future.
Basically, there is nothing wrong with day trading despite the fact that there are lots of risks here. You can trade either during the day or not, nobody is able to make you choose the option which you don’t need, but you have to understand that day trading really differs from other options. You should elaborate a strategy which will exclusively suit this type of trading, you have to weigh all pros and cons, count all the risks because this type is actually too risky, expecialy if you’re a novice in trading. You ought to note that this can’t be a long-lasting trading activity, you just can to try it, but, who knows, maybe you will succeed in it.
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You could earn in Forex or you could lose, it all depends upon the market situation and your skills and knowledge.
The biggest issue with day trading (including scalping) is not market risk, that TA doesn’t work as well, news releases, or the inability to find a suitable strategy…
No, the biggest risk in day trading is the heightened emotions you have when trading on such a small time frame.
Most of us can learn to lose money gracefully if we do it over a longer time period. But losing 1% or 2 % of our capital in the space of 10 minutes or an hour and we can seriously go TILT.
The opposite is also true, if we make 300% of our initial risk in the space of an hour we start thinking we are a superstar trader which leads to emotionally charged over trading.
Both these scenarios also occur on a daily timeframe, but the ability to sleep on it in trading is a massive bonus.
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This is 100% so true! Very helpful and good insights.
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If the stock’s price would be rising during the time the day trader owns it, the trader could realize a short-term capital gain. If the price would be decreasing, then the day trader would be accruing a short-term capital loss.