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Day trading momentum strategies for beginners

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Admin

February 4, 2019

Day trading is a quickly-emerging form of stock market trading that involves buying and selling stocks on the same day. Day trading takes advantage of small price movements and many day traders have made their lives’ earnings by day trading.

However, day trading can be risky for beginners. Novice traders need proper equipment and solid day trading strategies momentum for beginners to make profits.  

Day trading strategies help day traders focus on controlling risks and developing the right trading attitude. In fact, these strategies are the starting point to day trading and form a strong foundation for your success in the market.   

5 Day trading strategies momentum for beginners

Read and follow these day trading strategies momentum for beginners:

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Momentum Trading

Momentum day trading strategy is effective when multiple time frames are used. For instance, if prices of stocks reach a resistance level on a daily or 1-hour chart, day traders can use a 5-minute chart to trade a potential reversal.  

                                              

Day traders should always use a stop loss order in order to exit the trade in case the stock moves against them.

 

Day trading momentum strategies are suitable in situations when volatility and volume are increasing for a particular stock.

Pullback Strategy

Pullback refers to the situation when the trading market exhausts its current cycle of stock buying or selling.

There are two ways to trade pullbacks – tactical or strategic. The strategic or long-term traders use pullback in trading as an opportunity to enter the trend. They purchase stocks and sell them at the peak hours and a higher price.

Contrarily, tactical day traders buy or sell stocks according to when the pullback is expected to start. They assume that some reversion may happen as the price gets further from fair value that may trigger the pullback.

Pullback Strategy

Pullback refers to the situation when the trading market exhausts its current cycle of stock buying or selling.

There are two ways to trade pullbacks – tactical or strategic. The strategic or long-term traders use pullback in trading as an opportunity to enter the trend. They purchase stocks and sell them at the peak hours and a higher price.

Contrarily, tactical day traders buy or sell stocks according to when the pullback is expected to start. They assume that some reversion may happen as the price gets further from fair value that may trigger the pullback.

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Always Begin With Daily Chart

The daily stock chart gives you better insights of the past trading history and important characteristics of the market you can choose to day trade. For instance, you can start by monitoring stocks that are close to breakouts that produce the highest ratio of winning to losing day trades.

Trade Volatile Stocks

Volatility refers to the measurement of the price movement for a stock over a period of time. High volatility occurs when there are a lot of ups and downs in the day trading market. In the event of no movement, you can’t make profits by day trading your stocks.

Having problems? Any question?

Tradenet is a leading day trading firm preparing successful day traders since its inception. We teach you A-Z of day trading through free chatrooms, video lessons, structured courses and much more.

Tradenet offers a free trial for their chatroom, free trial package, and a wide collection of free YouTube videos. You can enroll in Tradenet’s weekly mentorship session, self study course, personal coaching and more. Once you start practicing with Tradnet, you will master the art of day trading by practicing and using proven strategies.

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