A Beginner's Guide To Day Trading | Everything You Need To Know in 1Hr

A Beginner's Guide To Day Trading | Everything You Need To Know in 1Hr

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hey hey it's similarly here and in this video a beginner's guide to day trading you will find everything you need to help you be that successful and profitable day trader that you need to be there are six parts to this video the first one i go over all the basic necessities that you need to be an efficient and successful day trader in part two i introduce a very simple trading strategy with which you simply cannot go wrong part 3 measures support and resistance lines as well as trend lines and you know what don't ever think of trading without your support and resistance lines that is something i wish i had known when i started day trading so many years ago it would have saved me a lot of losses in part four i show you how to create a watch list and how to use a scanner to scan for your trades let's not forget about those alerts because no point scanning for your trades if you're not alerted when all your criteria have been met in part five i go over five mistakes you simply need to avoid in order to not sabotage your whole day trading experience and lastly we go over trading terminology once you can successfully go through this hour-long trading video then you've practically got everything you need to help you begin on your day trading journey the only thing that i won't be able to help you with is actually practicing all your strategies now also this video has been put together to make it easy for you to share with friends and family since it contains six of my videos all together in one package the only thing i ask is that you hit that like button and subscribe to the channel so without further ado let's get right into it [Music] so five basic necessities needed in order to day trade you need the equipment you need a platform you need to understand some basic terminology it's important that you have a community of like-minded people to plug into but most of all you need the commitment to learn [Music] your desktop or your laptop is going to become your most valuable equipment this is all that you need to get started now eventually you may get to the point where you want to add on a monitor or two as you become more experienced at trading but to get started all you need is your desktop or laptop now a phone can suffice to enter into a trade so to exit trades it once you know what you're doing and what points at which you want to enter they also work to monitor your trades so i would use a smartphone just as a supplemental device to act maybe as that second screen [Music] as far as platforms are concerned you most definitely want a platform that allows for paper trading as well as live trading paper trading is a feature offered by many trading platforms that allows you to trade completely risk-free so you're not using real money you're given a set balance to use and the beauty of it is you're able to place trades based on live data so it's invaluable when you start off trading you really don't want to use your money before all the obvious reasons the paper trading platform that i personally use is the one by td ameritrade called think or swim and is considered one of the better more comprehensive platforms out there for paper trading and for its charting features it also has a mobile app to boot and i will leave a link in the description box below for those of you who might want to sign up and just get trading already [Music] for trading terminology there's just no escaping the need to know and understand the meaning of key terms such as the difference between a breakout and a breakdown drawing trend lines the meaning and importance of support and resistance lines just to mention a few of the terminology that is important to have understanding of in order to move forward in your trading journey and i've actually made a video specifically on trading terminology and a link to it should show up at the top of the screen or at the end of the video [Music] whether it's twitter instagram telegram facebook it doesn't really matter it's important to find a community of like-minded people who are committed traders with a range of experiences the whole point being that you're in the community where you're constantly able to learn and glean information that will help to enhance your trading journey i think it should almost go without saying that the time commitment is the glue or even like is the catalyst that's going to help you make something positive out of your desire to become a day trader and to get to the point where you can begin to trade profitably without the time commitment there's even no point starting it's got to be where every day you're either reading a book about trading watching a video about trading communicating with others on your various social media groups it's a hands-on approach that's needed to help you learn and once the time commitment is there then it's just a question of time before you get to that point where you can say you can day trade and make profit [Music] the bollinger bands are the white bands so we have the upper white band the lower white band and then right through the middle of these two bands we have the mid bollinger band because the premise under which bollinger bands operate is that once price action breaks out above the bollinger bands or breaks down below the lower bollinger bands ultimately price falls back within the banks so looking at the chart we're going to going from the left of the chart price action decreases all the way down to the bottom bollinger band and price action again works its way back up to the top of the bollinger bands as soon as it reaches the top we see again it working its way back down so if we pick up a stock or a cryptocurrency uh coin at this point then we would hold it over the duration of time in which price action is making its way back up to the top of the bollinger band now at the top or close to the top of the bollinger band would be a good point at which to exit the trade because you always got to remember it's always best to sell on the uptick now remember a day trader wants to buy and sell financial instruments within the period of a day so whilst price is still on the uptick while it's still increasing that's the best time in which to sell as price action is rising to the top of the bollinger band at any one of these candlesticks then would be a good point at which to sell the whole point being you want to sell before it gets to the top of the bollinger band because the likely motion after it gets to the top of the bollinger band is for it to come down as again we see here so this is how bollinger bands work [Music] so even though we have price action trailing along the bottom of the bollinger bands we still need another indicator to let us know when to enter in to a trade because as we can see here for the past like um about half an hour price action has just been hanging out at the bottom of the lower bollinger so what we're looking for is when it is ready to start bouncing up so at this point we'll probably need another indicator to help us know when is the good time to enter into a trade we only want to enter a trade when price action starts heading back upwards now down here we see the rsi so to know more about the rsi i suggest you watch the video i made on the rsi indicator it is used to time entries into a trade and exits the minute price action crosses back over this 30 line would be a good time to enter into a trade we see that line heading back up so at this point would be a good point at which would now go to purchase our securities believing that price action will head towards the top of the bollinger where we're going to take profit so now i've moved over to my trading page and keeping an eye on rsi which is at the bottom you can see the blue line there the minute it crosses over the 30 line then we're going to place a trade okay so the rsi is now getting ready to cross over the 30 okay so it is over the 30 line so i'm going to initiate that trade i'm just going to pick up five netflix shares [Music] and that's the trade so we're going to be patient in this trade because it's going to take it a little while to get to the top of the bollinger or at least close to the top of the bollinger so at this point we can see that the price action is not going straight up it's going up a bit and coming down a bit and that's perfectly okay you got to be able to be patient to allow your setups to play out so what happened here is what we call a retracement and so the stock retraced which is perfectly normal for it to be retracement in the process of any particular trend okay so price action has not just gone to the top of the bollinger it's actually gone beyond the bollinger the upper bollinger band it's come back or retrace a little bit so you want to always trade with your stop losses such that if there is a reversal then you're able to exit your trade before you lose all your profits so what we want to keep an eye on here is the rsi we see that the rsi indicator is showing a state of overbought so we've got a lot of buyers showing up and so the buyers are the ones that push the price up but the indicator the rsi is showing red meaning we're getting to a state of being overbought so that's a lot of fury to say we're looking at that red part of the indicator when it crosses below the 70 we're getting out of that trade and the presence of more sellers than buyers will always lead to a decrease in price and there we have it the rsi has dropped below 70. we're going to exit this trade at this point to ensure that we can retain our profits and that folks is how we use bollinger bands with rsi to trade profitably [Music] to ensure we always buy at a discount we will only be entering into our trades at support and resistance levels as well as at trendlines [Music] the very first thing we have to do is to make sure that we are charting on on a higher time frame now i use the daily chart some will use the weekly but i prefer to use the daily chart so to draw your level you're on your highest time frame and you're going to start to the left of your chart so we're going to go to our earliest candlesticks and of course each candlestick represents one day and we can see to the left here that you know we have this cluster of candlesticks but what they all seem to have in common is that they're not going below a certain level point now that's what we want to catch in during our support and resistance levels so to the left i'm going to put my i'm going to put my price line i'm going to put it at a point where i've got the most number of candlesticks touching it so if i put it down here um i have one candlestick touching my price level if i move it up i've got three candlesticks but if i move it further up there i've got like i've got like seven or eight of these candlesticks touching this level this is the point at which i'm going to draw my level and in drawing the level if we look to the right we can see that this level was respected price action from the point at which we've drawn this particular level on the left uh we can see price action has just been uh trading up above the level which is a good sign of strength but then we have a sell-off here and price rolls all the way down but manages even though it breaks down below the level it still respects the level and the very next candlestick takes the price action back above this all important level so this is a strong support level so that's the first one we've drawn and let's see if we can find some more moving up okay so i find another area here because when i again i see a cluster of candlesticks so this is like a period of um two weeks where price action simply was not breaking above the level that i'm about to draw so if i get it right and i click creating that level now let's look to the right of the chart and again we can see that this level has been highly respected because at these various points to the right again we see that price action bounced off the support level so you consider the support level like the the floor and you consider the resistance level the ceiling so what was to the left of the chart a ceiling to the right of the chart becomes a floor now let's keep going and see how many more of these supporter resistance levels we can actually find there's another one now this is on this we have our support and resistance lines drawn so what this is going to help us do is as trading continues if we look to the far right we got we got a little sell-off going up there you call it a retracement but we can see that we've got one two three four four red candlesticks and they're heading down to this our lowest support line the question is is it going to respect that line so it can respect it by coming down to it not breaking down below it and simply reversing back upwards or it could break through it and continue down and in that case we'll say it's now broken through our support line and that support line automatically becomes a line of resistance so what was the floor after price action breaks down below it suddenly becomes a ceiling so if we want to get into a trade we're going to wait and see if price action will come all the way down to our lower support level and once we see it comes down to the support level the next thing we're looking for we could use an indicator like the rsi to help us enter into the trade at a much lower point now the theory is always in more notably the real estate industry to buy low and sell high well the same goes with day trading you always want to buy low and you want to sell high you do yourself a favor by waiting until you can enter that trade at the cheapest possible price [Music] this blue line is a trend line it shows you both the top limit and when you draw a bottom trend line it shows you the bottom limits to which price action is moving over a period of time so in this instance we have a top trend line and it's basically marking the swing highs so we have this price action on google it swung high up here at this point swung high at this point here's another point another one another one now let's draw the bottom trend line so for the bottom trend line we're going to look for those areas where price action came all the way down to the swing glow points we call these low points the swing glows and we're going to try our best to connect them with as many touches as possible i'll pull up my trend line and if i draw it just from here to here well i've only got two touches and that does make a trend line but what makes a stronger trend line is one that has even more touches so let's see if i can attempt to create more than two touches we now have both the upper trend line and the lower trend line and we have price action oscillating up and down within the boundaries of these two trend lines so the next thing we're going to go into is how to use these trend lines to help us be more profitable in our trading now i'm going to show you how to use these trend lines in your day-to-day trading we can see this decrease in price action down to the point where it got to the bottom trend line but just ricocheted right off it this would be a point at which to enter into a trade once you're in a trade and i'll use this area as an example once you get into a trade at this point and once you've got some profit you probably want to come out of your trades as price action edges closer to the upper trend line because once price action gets to the top trendline there is a greater chance of it bouncing down to retrace back downwards this is basically how i use trend lines to inform my trading it helps me enter into trades at the appropriate times when price action is closer to by lower trend line and then it helps me exit the trades more often than not before price action even gets to the top trend line in this instance we have a top trend line and it's basically marking the swing highs so we have this price action on google it's swung high up here at this point swung high at this point here's another point another one another one now let's draw the bottom trend line so for the bottom trend line we're going to look for those areas where price action came all the way down to the swing low points we call these low points the swing glows and we're going to try our best to connect them with as many touches as possible so what i mean by as many touches as possible is i'll pull up my trend line and if i draw it just from here to here well i've only got two touches and that does make a trendline but what makes a stronger trend line is one that has even more touches so let's see if i can attempt to create more than two touches that's the third touch or we could call this the third touch after a while you'll become skilled in knowing exactly where you want to put your trend lines i would rather put it further up where i'm touching the bottom of these two green candles so once i have my trend line drawn where it's touching three candles i now extend it to the right and of course i prefer my trend lines to be blue and and here we have our bottom trend line we now have both the upper trend line and the lower trend line [Music] so here we are on trading view and to set up a watch list is quite straightforward so first we're going to go over to the right side of the chart right at the top here where it says watch list and details click on that and this is where we begin to set up our watch list we're going to use these plus signs to add our symbols to the watch list so if you're into crypto we're going to highlight crypto and we're going to use these plus signs to add our coins to the watch list now one thing you have to bear in mind with cryptocurrency is you really only want to add the coin pair that is featured for your platform on which you plan to trade so if you trade your bitcoin on bitmap and this is the version of bitcoin usd that you want to add to your watch list and if you're on binance now binance doesn't have a u.s bitcoin direct pair so the closest you're going to get is to use tether so we'll add tether and so if you have your us dollar on coinbase you want to pick up if you want to keep an eye on the if usd pair i'm gonna click on that one and so on and so forth like you can add your index funds here if you're into trading index funds stock tesla right now i am in a tesla trade so i probably want to keep my eye on tesla i do have some neo stock i want to keep my eye on neo and so on and so forth so nice and straightforward so let's come out of this and right here we have our watch list already created for us if we highlight these three dots here it will allow us select what criteria we want to see on our watch list so we're just going to reduce the size of our chart so that way we can clearly see all the different fields that we want to see i think this is a bit busy so i'm going to remove change so i think this is a little neater once you've created your watch list and you're particularly interested in certain stocks for instance i'm interested in tesla for today then i can go to the left and bookmark tesla and you can see the different colors there let's do that again you've got to have the paid subscription in order to use the different colors but i only have the free subscription so red is just going to have to suffice so after we've created our watch list then we can easily go through our list to see what's going on on the charts as you flick through your watch list you'll see the one hour chart displayed for each of these selections we can use trading views inbuilt screener at the bottom left of the screen whether it's crypto currency that you're wanting to screen forex or stock then we can use the various parameters to select our coin or our stock or whatever it is we're wanting to trade based on our selection criteria if you go over here that says general you can actually select the criteria that you're looking for so if you're looking for top gainers then it shows you percentage-wise the top gainers on the day if you click on it it should pull up the charts well yeah the charts right there if you want to see more charts than screener then you can just kind of decide how much of each you want to see if you're looking for the top losers or the 52-week high overbought oversold those outperforming the sma the 50 simple moving average whatever the criteria you're looking for is what you enter in so if you're looking for the most volatile coin or stock to trade it'll pull it up and there's the full list there so of course you can use this for stocks as well again we can go to [Music] our filters we have our screening parameters over here we have our filters also you're looking for whatever it is you're looking for whether based on the description if you're looking for stocks in any particular sector then that would be here if you're looking for stocks where over the last 60 days the average volume is greater than 50 000 but less than 50 million and of course you would work it this way up and down so between 2 million and 50 million and that's all that will pull up you can reset that or if you are searching based on your technicals then you know you're looking for those stocks or those coins that have made a new one-month high or whatever else your technical or fundamental requirements might be [Music] and the last thing i'll talk about is how to set up your alerts once you've set up your various parameters for your screeners you're setting your filters and now once your criteria is met then you want to enable alerts you do that with this button right here you can use the calendar to say how long you want that alert to be in effect for all the way to okay you want your alert to be in effect all the way till the end of february if you wanted to show a pop-up if you wanted to send an email if you want it to do more you want it to play a sound once and then whatever specific message that you want to pop up then you enter it in right here and then you enable it so the minute your criteria is met you'll get an alert the quickest and the easiest way of ensuring you become part of the 90 of day traders who fail is to trade without a trading plan when i first started trading a couple of years ago i would have both winning and losing trades but my losing trades outnumbered my winners looking back now i can see clearly that this was on account of not having a trading plan and there's no way as a day trader you can expect to be profitable without a plan so your trading plan could be in the form of a checklist where before you enter or exit a trade you go through your checklist to ensure that you've done your due diligence will you be scalping day trading or swing trading are you bullish on the trade or bearish what conditions would trigger an entry or an exit are you trading penny stocks or large caps what percentage of your account do you want to apply towards the trade or each so these are the kind of things you'd want to know before you enter a trade making a trading plan is one thing keeping to it is another thing this is where trading on a paper account using your strategies and your trading plans will help to make you a more profitable trader as a new trader i knew little or nothing about support and resistance levels trading for me was a bit like trying to move around in the dark i would win some trades i would lose some trades and i simply wouldn't know why or how the wins or the losses happened since using support and resistance levels it's easier for me to enter into the trades usually at support or at trend lines and to exit before resistance which makes for a cleaner smoother and more consistent trading style this of course leads to more consistent wins [Music] increasing your position sizing compared to the size of your account is one sure way of blowing up your account and quickly becoming part of the 90 percent of day traders who fail in day trading position sizing simply means going into a trade with a smaller quantity of shares or coins such that even though your profits may not be huge by the same token if the trade goes against you neither will your losses be huge if you're trading with a hundred dollars and you allocate 10 percent of your account to losses then trading with a hundred dollars means that you're only going to lose ten dollars if your trade goes against you however trading with a thousand dollars a ten percent loss means you've got to be willing to lose a hundred dollars so that tends to be the question are you willing to lose a hundred dollars in a trade if you're not willing to lose up to a hundred dollars then you want to limit your position sizes and restrict your trading to the hundred dollars that is more manageable for you in the same line of managing your funds it's also a good idea not to allocate more than 20 percent of your investment funds towards day trading day trading is not your safest form of investment so you always want to keep your funds safe and secure by not for instance trading a hundred percent of your savings as a newer trader however i got so excited with the prospects of making money that i quickly burned through several accounts in the short space of one year trading with more than 20 percent of your account is a definite and certain way to quickly blow up your account [Music] if you have been trading or learning to trade for any length of time then you definitely would have heard the phrase the trend is your friend so in an uptrend in market you only want to be entering into long positions or buying calls if you're into option trading in a downtrend in market you only want to be shorting or buying puts which are two ways to profit in a downtrending market looking at this chart of tesla price action is obviously in an uptrend in flow we see these areas of retracement but it wouldn't be reason enough to begin to short sell or to buy puts only because the general direction of trend is upwards buying against the trend is a poor strategy and is one way to ensure that you don't become a profitable trader a stop order is an order that helps you exit a trade when a certain price level is reached usually you're using a stop order to exit a trade that goes against you before your losses become too great trading without stop losses is a bit like being in a burning house without any sign of a fire extinguisher this was probably one of the biggest mistakes i consistently made as a new trader and is definitely the one mistake you want to ensure you don't make [Music] when a day trader places a trade they're looking to capitalize on a stocks price movement all in the space of one day so that's what distinguishes a day trader from a swing trader a swing trader however is looking to make his profits over the course of a couple of days hence the term swing as in entering into a trade on the one day and swinging it into another day and that could equally be over a couple of days the term bull market is a term to describe a market that is on the rise where the economy is sound and the market strong so this means traders generally believe that the price of any specific stock will go up the fact that they know it'll go up they buy and the more buying pressure there is the higher the prices go this is what would be called a bull market a bear market on the other hand would describe a weaker market or a weaker economy where traders believe that the price of a specific stock or stocks in general will be going down trading equities is another name for trading stocks and it refers to the ownership of shares in a publicly traded company a security is an ownership or debt that has value and may be bought and sold so a stock is just a type of security and the word security and stock can be used interchangeably the bid price refers to the highest price a buyer will pay for security the ask price on the other hand refers to the lowest price a seller will sell a security typically the ask price is always going to be higher than the bid price the difference between these two figures is called the spread which is the profit that the platform will receive for hosting the trades volume is simply a measure for the number of shares traded at any one point in time once you add your volume indicator to your charts it usually will present at the bottom of the chart and i personally do not trade without ensuring that i have the volume indicator on my charts the volume indicator is a good visual representation of whether it's the buyers or the sellers who are dominating the trade at any particular point in time volatility is basically the price change of a security over a period of time and it determines its stability if the price stays relatively stable then the security has low volatility if however the price moves erratically and has rapid increases and dramatic falls then it's considered a highly volatile security going long means you're betting that a company's stock will increase in price so that you can buy low and sell high with a long position investment the investor purchases an asset and owns it with the expectation that the price is going to rise this investor normally has no plan to sell the security in the near future going short or short selling is a way to make money when a stock's price is falling short selling is is a fairly simple concept where an investor borrows a stock sells the stock and then buys the stock back to return it to the lender short sellers are betting that the stock they sell high will drop in price and that they'll be able to buy it low that's how they make their profit stay subscribed to my channel because you'll constantly get updated on more and more of the strategies that you have learned so you can reinforce your learning if you have found some value in this video don't forget to hit that like button share with your friends and family subscribe to my channel for most importantly don't forget to hit that notification bell this way you get my videos as soon as i upload them and i will catch you in the next video [Music] [Music] [Music] [Music] [Music] so [Music] [Music] okay

2021-01-19 11:17

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