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10 Trading Tips And Rules For Day Traders
Day trading is a convenient way for most people to make money when they dedicate a couple hours on it or, for some people, make it their full-time job.

Almost everyone’s dream (not to say everyone’s dream), is to be their own boss and work for as many hours a day as wished. 

With trading you can live your dream and have plenty of time to spend with your family, friends or doing the things you like the most.

When it comes to money, there's really no limit as to how much you can make as a trader. 

However, even though the upside is huge, it requires skills, knowledge, patience, and consistency; otherwise, you will be losing money instead of making money.

In this post I'm going to give you some of the best day trading tips and rules common among successful traders you can copy to become a great day trader and to help you avoid common trading mistakes.
Probably the most important rule when being a day trader no matter if you are a beginner or an advanced trader, is being patient. 

Trading is a really risky business where everything can happen and you need to be able to think and play your cards right in order for you to make consistent profits.

The majority of people that quits day trading, are too greedy and lack patience, which leads them to rushing decisions and making big losses.

Can you sit on your hands a whole day waiting for your setups without taking any unnessecary actions?

Trading Rule: Patiently wait and only take trades that follow your trading plan.
Successful Day Traders Rules
It's normal as you start making some profits in a trade to desire more and more. This is going to be bad for your trading results in the long run.

You might take a trade because you anticipate a reversal. 

Or you might take a breakout trade anticipating continuation of the trend.

Whatever your position is; you have to set a price goal or take profit target (where to take your profit) and you also need to set a stop loss (where to exit if your trade doesn't work out).

Once you set your price goals, stick to it, this way you will protect your trading account (risk management) and avoid the mistake of being too greedy.

Trading Rule: Always set a stop loss and take profit target when you enter a trade.
In day trading, is fundamental (hehe) to know your technical analysis.

Among day traders, price action trading is king.

One of the most popular price action trading strategies/techniques is supply and demand trading.

Make sure you always look to buy (go long) at demand levels and sell (go short) at supply zones.
Supply Level
Waiting for confirmation is rarely profitable in day trading, you need to be confident in your zones and trade them with no fear.

Day traders who wait for confirmation from (for example) a moving average crossover will be late in the trade and their risk reward ratio will suffer. The moving average crossover can work for swing traders and investors, but rarely for day traders.

Trading Rule: Trade a strategy based on price action, not lagging indicators.
Every trading strategy you use should be based on the behavior of the market.

You have to understand how the market works from the really simple details like trading hours to the complex details like trading psychology.

Not every market is the same and you have to consider every detail. In fact, in 1990´s day trading had a bad reputation due to “novice traders” that thought trading was a "get rich quick" thing.

Either be futures, forex, stocks, options, ETFs, etc. they all are traded in different ways.

You have to understand the specific differences between each one before you trade them.

Lack of knowledge and understanding will most likely lead to losses.

Want proven trading system based on the behavior of the market?
We all know that higher risk equals higher potential profit.

However, in day trading you should have a Risk/Reward Ratio (RRR) above 1 on every trade you make in order for you to always have a a higher potential reward to your risk.

Here is an example of a trade with RRR below 1, a trade most successful traders would ignore. The setup for this trade is a piercing candlestick pattern confirming a support level.
Risk/Reward Ratio RRR Forex Trading Strategy Example
Now same trade with RRR equal to 1, wich is still not good enough for most traders.
Risk/Reward Ratio RRR Forex Trading Strategy Example
Now let's look at the best option, RRR above 1 which means you reward is greater than your risk.
Risk/Reward Ratio RRR Forex Trading Strategy Example
As you become a better trader you'll learn how to better manage risk. 

Nevertheless, I recommended (no matter how experienced you are) to always take small risks and aim for big rewards on every trade.

In fact, the psychological impact that causes a high loss because of a bad trade can lead to revenge trading (to get back what you lost) and this will most likely end up with you losing even more money.

Trading Rule: Only take trades with a Risk/Reward Ratio above 1.
The most important rule to become a great day trader and make consistent profits is, well, to be consistent.

By consistent I don’t mean to trade every single day, but to always stick to your plan, risk management, strategies and most importantly control your mindset.

Unlike what the majority of people think, the best and most successful day traders in the world don’t trade every single day. 

The best traders are patient and wait for the best opportunities to trade.

More is not always better. 

In day trading, it is not that important how many trades you make but if they follow your plan or not.
Having several trading strategies or at least two strategies can be really helpful.

In case one of your strategies doesn’t give you setups, you can use the other one.

The more strategies you have the better (as long as you don't get confused and can't follow your plan).

If you trade too many strategies you will find it really hard to stick to your risk management because of all the open trades you might have in the market.

Like I said before, more is not always better. 
There are plenty of trading robots in the market that claim to be the best “predictors” of the market and will help you "make millions of dollars". 

The truth is that these robots are a waste of money and time, and can lead to huge losses.
The best way to invest your money is, without a doubt, in education.

Learn for someone that can give you all the knowledge you need to make yourself more money, instead of wasting money on robots.
Unfortunately, you won’t win every day even though you trade your plan right.

Accept that you will have losses now and then.  Believe that tomorrow will be a better day.

It is important that you day trade with money you actually have and can afford to lose. So have a loss bucket that consists of a certain amount of money you saved for those times when you're in a losing streak.
Even if you're a successful trader you don't know when the next drawdown is coming.

So never use borrowed money to trade the forex market. 

Also, the money you trade with should not be the part of your savings or emergency fund.

Trading Rule: Only trade with money you can afford to lose.
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Johan Nordstrom Professional Trader Risk Management
I'm a family guy in my late 20's who learned how to trade the markets in a simple yet effective way. During university I studied investing and graduated with a master's degree in risk management. Quickly, I realized that I was onto something. I started helping friends and taking students. My students started getting results, spent less time in front of their screens, and their accounts grew consistently. Learn more about me here.
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