How To Start DAY TRADING

How To Start DAY TRADING
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In this video, I’ll guide you through a checklist for starting your day trading journey, drawing from my self-taught experience, which involved overcoming mistakes that cost both money and time. Whether you’re a novice or have some trading experience, this video aims to provide a concise roadmap for success. I’ll cover essential aspects such as software, tools, custom spreadsheets, accessing capital, and tips and tricks.

To avoid a common trap that derails many beginners, I’ll discuss the tendency to focus on the wrong things, leading to what I term the “spin cycle.” Often, new traders start by finding a pattern online, making initial profits, and reinforcing the belief that waiting for losing positions to turn around is a valid strategy. However, this approach can lead to catastrophic losses and a cycle of seeking new information without addressing the flawed mindset.

The key to successful trading lies in understanding two fundamental statistics: average risk-reward and average winning percentage. By showcasing a simple example with a $500 account, a 1% risk per trade, and a 1:2.5 risk-reward ratio, I demonstrate how even with a low winning percentage (35%), you can grow your account.

Setting Up Trades

Next, I delve into setting up trades using Fibonacci analysis on TradingView, emphasizing the importance of uniform risk and static risk-reward ratios. Leveraging the A35A process, I show how to identify potential reversal points in the market and position yourself for high-probability trades.

To calculate position size, I introduce a trade position calculator, illustrating how to determine the required units for a trade based on entry, target, and stop-loss levels. Additionally, I explain the beauty of leveraging exchanges in crypto trading, allowing you to use more money without tying up excessive capital.

By the end of the video, you’ll gain insights into a strategic approach to day trading, emphasizing consistent processes, risk management, and leveraging available tools and platforms. If you’re ready to embark on or revamp your day trading journey, this checklist provides a clear-cut path for success. Don’t forget to like the video, subscribe to the channel, and follow us on Tick Tock, Instagram, and Discord for more trading and investing content

Process Works

Now, let’s delve into how this process works. First, we need to use the trade calculator. Input your limit price, such as 1920, and the quantity, like 1.92. This will show that $3,688 is required for the entire position. However, by adjusting the leverage, you can significantly reduce the capital needed. For example, at 50x leverage, the cost drops to $78, still with a risk of only $25.

It’s crucial to understand the concept of liquidation price. By using the calculator, you can determine the liquidation price for the chosen leverage. If it’s within your stop-loss threshold, your position is safe. Adjust the leverage until you find a balance between capital efficiency and risk management.

The next step is testing your system and inputting criteria into a backtesting sheet. This sheet includes details like the date, ticker, trade direction, and profit. It uses color-coding to differentiate between winning and losing trades, providing a comprehensive overview of your trading performance. Another sheet covers specific statistics for long trades.

For backtesting, you can use TradingView’s bar replay feature. This allows you to simulate trading your system in historical conditions, helping you evaluate its effectiveness without waiting for real-time results. After gathering data, you can analyze winning and losing trades separately, identifying patterns to improve your strategy.

This process, embraced by private trading team members, has proven effective in refining strategies and enhancing trading performance. By following this systematic approach, you can save time, avoid common pitfalls, and accelerate your journey to becoming a successful trader.

If you found value in this video, don’t forget to hit the like button and subscribe to the channel for more trading and investing content. Also, check out our Tick Tock for additional exclusive content. Until next time, stay tuned for more valuable insights.

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