Tuesday, September 26th, 2017

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How do you form a day trading strategy?


I hear a lot about how traders buy the Financial Times in the morning read it on the way to work and form their trading strategy for that day based on what they read.

Can someone explain to me how this is done? I got the FT this morning but I don’t quite know what I’m looking for in it to give me the clues for the way the market will move.

What do traders look for in the FT? How does the news that it reports on swing the market?

I always find hypothetical examples pretty helpful so one would be a great help.

Cheers guys!



2 Responses to “How do you form a day trading strategy?”
  1. Peter B says:

    The idea behind day trading is “buy low and sell high”.

    What you see in stock exchange figures is the previous day’s prices (opening, closing, high, low), and the volume of trade (how many shares were sold or bought during the day). There is often other data, like price earning ratios, high/low in the last 12 months, dividends paid per share for the last year, and a few others.

    Experts analyse the share movements (changes in price) and the volumes. There are patterns that seem to indicate when a share will go up and when it will go down, and these determine whether one wants to buy a particular stock or sell that stock if one owns the shares. So, the first thing is to decide whether to buy or sell.

    The FT is a good paper for the raw data, but it takes a lot more information to know when to buy and sell. Often, by the time the paper has the data, the swing has already happened – the data is too old. But it does give enough, when added to the historic data to make reasonable decision on when to buy or sell.

  2. b2fnow says:

    Here is an investment strategy, not a Day Trading strategy.

    In the FT, you read that Haiti had a huge earthquake, and need medical supplies.

    In the same article they list some suppliers of medical supplies being flown in, and state they have a contract to supply more for the next year.

    You call your broker, or login online, andbuy that stock.

    If you want to day trade, you need to learn how to become a trader rather than an investor. Plan on several years of study and lots of reading, and losing all of your money several times before you get it right.

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