Forex Day Trading - Are You Ready?

What is a day trader?

Day traders open and close their trade positions by the end of each day. They usually take their profits (or losses) on smaller market price fluctuations of about 10-25 pips. They include both institutional traders (like the big banks) and retail traders (like you and me).

In this article, I'll assume that you're interested in becoming a retail day trader (and not an institutional day trader).

What it takes to be a retail day trader

You'll first have to consider these questions:

1. Am I ready to commit to the time demands?

Day trading often requires you to sit in front of the computer for long hours in anticipation of good market entry setups. Because traders open and close their trades in the short time span of a few hours (or minutes), every opportunity for a good entry is precious. As a retail trader, you really can't afford to let good entry setups slip away. If you'll need to be constantly away from your trading terminal (or computer), then trading might not be for you.

2. Am I ready to commit to the physical strains?

This is similar to the previous point. As mentioned before, day trading requires you to sit in front of your trading terminal for long periods of time. Many people make the mistake of thinking that Forex trading only takes one or two hours a day - but in reality that's very far from the truth. Profitable trading requires high levels of concentration for long periods of time, and unfortunately these demands are a little too harsh for a lot of people. Backaches, eye strains and headaches are common complaints among would-be traders; and if you're unable to handle these harsh physical demands, perhaps a better option would be to consider swing trading, or position trading instead.

Conclusion

These are just some of the considerations you should think about when deciding on the trading style you wish to adopt. Too many people think that it only takes a little effort and time, but that's hardly the case. In my experience, day trading is pretty demanding, so you'll need to be both physically and emotionally prepared to handle it.

Harold Hsu is the owner of http://www.ForexSystemProfits.com where he provides premium Forex trading information and resources.

Harold is currently giving away a free 26-page report on how to trade profitably in the Forex market, and you can get it now at http://www.ForexSystemProfits.com

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