The goal of swing trading is to capture a chunk of a potential price move. While some traders seek out volatile stocks with lots of movement, others may prefer more sedate stocks. In either case, swing trading is the process of identifying where an asset's price is likely to move next, entering a position, and then capturing a chunk of the profit from that move.

With low barriers to entry in the trading world, the number of people trying their hands at day trading and other strategies such as scalping has increased. Newcomers to scalping need to make sure the trading style suits their personality because it requires a disciplined approach. Traders need to make quick decisions, spot opportunities and constantly monitor the screen. Those who are impatient and feel gratified by picking small successful trades are perfect for scalping.

This often means trading shares of companies that have just released breaking news, reported earnings, or have another fundamental catalyst that is resulting in above average retail interest. The type of stocks a day trader will focus on are typically much different from what a long term investor would look for. Day traders acknowledge the high levels of risk associated with trading volatile markets and they mitigate those risks by holding positions for very short periods of time.

Day traders use only risk capital which they can afford to lose. Not only does this protect them from financial ruin, but it also helps eliminate emotion from their trading. A large amount of capital is often necessary to capitalize effectively on intraday price movements. Having access to a margin account is also key, since volatile swings can incur margin calls on short notice.
The next important step in facilitating day trading was the founding in 1971 of NASDAQ—a virtual stock exchange on which orders were transmitted electronically. Moving from paper share certificates and written share registers to "dematerialized" shares, traders used computerized trading and registration that required not only extensive changes to legislation but also the development of the necessary technology: online and real time systems rather than batch; electronic communications rather than the postal service, telex or the physical shipment of computer tapes, and the development of secure cryptographic algorithms.
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Trading stocks intraday offers different opportunities than a traditional ‘buy and hold’ strategy. Speculating on stock prices via CFDs or spread betting for example, mean traders can profit from falling prices too. Margin or leverage also reduce the capital required to open a position. So you can take a position on the latest news release, product announcement or financial report – as well as technical indicators.
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The sheer volume of forex trading makes it attractive for day traders. There are multiple short-term opportunities in a trending currency pair, and an unrivalled level of liquidity to ensure opening and closing trades is quick and slick. More suited to technical analysis, there are other ways to trade foreign exchange. In addition, forex has no central market. This means traders can make trades six days a week, 24 hours a day. They present a great starting point for entry level or aspiring traders with full time jobs. Traders in Australia might be specifically interested in trading the AUD USD pair.


So, swing traders are not looking to hit the home run with a single trade – they are not concerned with the perfect time to buy a stock exactly at its bottom and sell exactly at its top (or vice versa). In a perfect trading environment, they wait for the stock to hit its baseline and confirm its direction before they make their moves. The story gets more complicated when a stronger uptrend or downtrend is at play: the trader may paradoxically go long when the stock dips below its EMA and wait for the stock to go back up in an uptrend, or he or she may short a stock that has stabbed above the EMA and wait for it to drop if the longer trend is down.

However we have a word of caution for them as intraday trading is not as simple as it sounds.Making profit in intraday trading on a daily basis is not that easy and requires lot of hard work and discipline.What are your views on this – “Whether a newbie in stock market should resort to intraday trading or not”.Drop in a comment to share your views.
A pure scalper will make a number of trades each day — perhaps in the hundreds. A scalper will mostly utilize one-minute charts since the time frame is small, and he or she needs to see the setups as they shape up in as close to real time as possible. Supporting systems such as Direct Access Trading (DAT) and Level 2 quotations are essential for this type of trading. Automatic instant execution of orders is crucial to a scalper, so a direct-access broker is the preferred weapon of choice.

Day trading is making short-term trades, lasting less than one day, in an attempt to extract a profit from the financial markets. Some day traders are very active, making many trades each day, while other traders may only make one or two trades per day. The most common day trading markets are stocks, forex and futures. Day trading can be a part-time or full-time career, depending on the trader's style.

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You're probably looking for deals and low prices, but stay away from penny stocks. These stocks are often illiquid, and chances of hitting a jackpot are often bleak. Many stocks trading under $5 a share become de-listed from major stock exchanges and are only tradable over-the-counter (OTC). Unless you see a real opportunity and have done your research, stay clear of these.
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