10 Best Day Trading Tips For Traders

Day trading just a few hours each day can give you a lot of freedom, so compared to working a 9 to 5 job, you can have plenty of time to spend with your family, friends or doing the things you like the most.

For example, I prefer to trade the first three hours of London or New York market opens.

And there's no limit on how much you can make when you are great day trader and consistently profitable in day trading.

But there's a catch.

Even though the upside is huge, it requires skills, knowledge, patience, and consistency.

Trading is not a "get-rich-quick" thing.

Here are the 10 best day trading tips to become a great and more profitable day trader:

1. Set Stop Loss And Take Profit Target

It's normal as you start making some profits in a trade to want to secure the profit earlier than planned. 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 the continuation of the trend.

Whatever your position is, you have to set a take profit target (TP), where you close your position for a profit.

You also need to set a stop loss (SL), where you close your position for a loss if your trade doesn't work out.

Once you set your stop loss and take profit, stick to it, this way you will protect your trading account and avoid the mistake of being too greedy.

These trades are taken when trading the 10X Trading System (trading 10X signals at support and resistance levels will help you find 10+ risk reward ratio trades (why it's named 10X) when you get the hang of it).

Always set a stop loss and take profit target when you enter a trade.

2. Trade With Patience

One if the most important day trading tips for day traders, no matter if you are a beginner or an advanced trader, is trading with patience.

Trading is very risky if you trade on hunches and gut feelings, anything can happen, so you need to be able to stay patient when there are no trade setups and act fast with confidence when you get a trade setup.

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 unnecessary actions?

Patiently wait and only take trade setups that follow your trading plan.

3. Know Technical Analysis

In day trading, is very important to know your technical analysis.

Among day traders, price action trading is king.

One of the most popular price action trading strategies/techniques is support and resistance trading.

Make sure you always look to buy (go long) at support levels and sell (go short) at resistance levels.

Here's how I find and trade hidden supply (resistance) and demand (support) levels:

Waiting for confirmation is rarely profitable in day trading, you need to be confident in your levels and trade them with no fear.

Day traders who wait for confirmation from (for example) a lagging 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.

So trade proven day trading strategies and non-lagging signals based on price action.

4. Understand The Markets

Every day 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.

You might trade futures, forex, stocks, options or crypto, etc. they all are traded in slightly 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.

"Before you invest in something, invest in time to understand it. " ~ Warren Buffett

5. Master Risk Management

We all know that higher risk equals higher potential profit. So one of the essential topics all great day traders have mastered is risk management.

In day trading, you should have a Risk Reward Ratio (RRR) above 1 on every trade you take in order for you to always have a higher potential reward compared 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 breakout of a chart pattern.

Risk Reward Ratio for day traders example 1

Now same trade with RRR equal to 1, which is still not good enough for most traders.

Risk Reward Ratio for day traders example 2

Now let's look at the best option, RRR above 1 which, means you reward is greater than your risk.

Risk/Reward Ratio for day traders example 3

As you become a better day trader you will learn how to better manage risk.

Nevertheless, I recommended (no matter how experienced you are) to always take small risks (1% risk per trade) and aim for higher rewards on every trade.

Only take trades with a Risk-Reward Ratio above 1.

6. Stay Consistent

One of the most important trading tips 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, and most importantly control your mindset.

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

The best traders are best because they wait for the best opportunities that follow their plan. They get consistent results because their trading is consistent.

More is not always better.

In day trading, it's not that important how many trades you make but if you follow your plan or not. Be disciplined and consistent in your trading.

7. Trade More Than One Strategy

Trading 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 bette, especially for beginners.

Trade more than one strategy, but not more strategies than you can handle.

8. Invest In Education

Great day traders invest in education and grow their skills.

Read trading books, take courses, and get mentorship to develop your trading skills.

Learning from someone that has been where you are can help you speed up your learning curve by giving you everything you need to become a successful day trader.

Don't believe me?

Listen to these brilliant minds on why investing in education is key

"No other investment yields as great a return as the investment in education. An educated workforce is the foundation of every community and the future of every economy." ~ Brad Henry

"An investment in knowledge pays the best interest." ~ Benjamin Franklin

"Risk comes from not knowing what you're doing." ~ Warren Buffett

9. Trade In The Zone

"You have to train your mind to be stronger than your emotions or else you'll lose every time." ~Unknown

Don't let your emotions carry you away.

Great day traders stay calm and trade "in the zone".

The psychology of trading is a big subject. Trading when your exited or worried will most often cause you to make mistakes (more mistakes = more money lost).

It can be very difficult to follow your plan, especially after you've experienced a losing streak. But by keeping a calm mind and trading in the zone, trade with no fear of trading, you will stay objective, so you can make good trading decisions. Whenever you let your emotions get the better of you, you expose yourself to unnecessary risks.

10. Start Small (Never Trade With Borrowed Money)

Unfortunately, you won't win every day. There will be losing days.

That's a fact, even if you trade a system with an edge.

And even if you're already a successful day trader, you don't know when the next drawdown is coming.

You will have losses, but that's fine if you mastered risk management.

It's important that you day trade with money you actually have and can afford to lose.

So never use borrowed money to trade the markets.

If you're a beginner, trade small and grow your account step by step..

If you're looking for a reliable broker, these are the brokers I use and recommend.

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Johan Nordstrom Professional Trader Risk Management

Johan Nordstrom is a full-time trader, and a family guy in his early 30's who trades the markets in a simple yet effective way. He has a master's degree in risk management and years of experience trading the markets. He has helped hundreds of struggling traders become consistently profitable. Read more.

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