Day trading is not for everyone just like Forex Trading. You need to have a strong personality to undergo gyrations of the market. You need to have strong attention to detail to be able to notice the things which can be unnoticeable to many. Despite all, a person with these characteristics will surely have a brighter future in this field. But if you want to know if day trading is for you, check these signs and take it all more seriously.
1. You Confuse Day Trading with Investing
There are quite a lot of people who want to control their investments. Though this can be possible, it is important to note that learning the basics should be your utmost priority. Things like proper diversification, the risk, and returns, the time horizons are among others that need your priority. Some people get confused with investing and day trading. But they are actually not the same.
Day trading is about the selling of securities, rapid buying, and taking advantage of the price movement of the market. There are strategies in investment that won’t work with day trading.
2. You Are Into Fundamental Research
No matter how good fundamental research is, it is considered incompatible to day trading. Day traders take advantage of ‘short-term price movements’, therefore, they don’t really know what’s going around a certain industry or they don’t really care. If you love to tackle fundamental research, then you are simply too analytical to become a day trader.
3. You Don’t Have a Lot of Time and Capital
When you start day trading, you are like purchasing a small business that takes commitment to your money and time. If you don’t have a lot of time, you might have difficulties in learning the technical patterns. And if you don’t have enough money, you cannot trade amidst rough cycles.
4. You Are Adept of Working in a Group
Some people prefer working at home but others enjoy the camaraderie. They like to work in a team and see friendly faces. If this is the case, then day trading is not for you.
5. You Want To Experience Excitement All the Time
Day trading requires you to sit in an office, with computer monitors all over you. You need to stay focused every time there are little blips on your computer. This repeated activity can be boring to many. So, if you ever crave excitement all the time, then day trading can be very boring for you.
6. You Are Impulsive
To become a successful day trader, you must trust your trading plan rather than your guesses. There may be times when you still make trades even though something feels so wrong. Then you’ll spend a long time sitting out when you actually want to get in. But good traders need to act right and quick.
7. You Can’t Set Boundaries Easily
To be able to limit the risks that you can acquire in day trading, you should set boundaries and immediately close out any losing positions. If you ever find yourself not being able to easily turn out the lights, day trading or Forex Trading may not be the best option for you.