Anyone wanting to learn day trading will figure out its a tough business, but if you learn how to do it, you can make far superior returns most of the time to traditional buy and hold or even swing trading. The key is knowing what kind of trader you are first off, so you can concentrate your efforts in that direction. Just like many other aspects in life, not everyone can be good at short term trading. You might become proficient, but you will really not make much money and just get frustrated. This does not mean trading is not for you, that probably means day trading is not for you, or it might be that stock trading is not for you.

Matching your trading o your personality is a very important step to being successful, or at least having the best odds of being successful. Trying to do or be someone that you are not usually leads to losses, frustration, and quitting. Now you can easily learn to do something you are good at, but the main goal is to be totally comfortable and like what you are doing. If it does not feel right after a few months (or even weeks), usually that style is not for you – at least as a main style. Even inside day trading, there are multiple ways to actually implement strategies – breakouts, retraces, extensions, fades, momentum etc – every trader will figure out what they are good at and look for those types of trades. Sure they might do others too, but they feel most comfortable in the “zone” of their expertise.

So how do you find your zone of expertise? Or even what style of trading suits you? First off, you will need to educate yourself (which means work, yes) so that you are exposed to all types of trading and charts. You should have a basic book on charting mastered, and an intermediate one that you fully understand the concepts. It is not necessary to learn math formulas, you want to understand the theories beneath indicators. You will also need a book on fundamental analysis (for buy and hold type), a book on swing trade identification, and a book on day trading strategies. There are many, many of them – I will not recommend any but just go to amazon.com or traders galleria ( trading rkets.com) – both have a good selection.

The main thing is to really understand what each type entails so you can see what appeals to you. Ignore what others have told you (both positive and negative) – read and learn, then get out your charts to work on applying what you have learned. Try various methods on different securities such as futures trading. Do research on companies – see if you like that OR if that is the most boring thing is the world. One thing I will tell you NOT to do – do not attend a bunch of seminars or pay for trading ourses etc – those will do you no good until you are much further along.

Too many people don’t want to put in the effort themselves to learn and want a “shortcut” method. They don’t exist. That is like saying I want a PHD in 3 months with no background education. You have to understand why something is happening and what it should lead to happen to actually use any method you might learn. Otherwise you are just a parrot – but the market is dynamic and changes – if you dont understand the principles that drive stuff, you are just wasting the money. The market will shift and you will not understand why your “secret method” is not working anymore.

The other aspect besides education is realizing what type of personality you have when it comes to trading. Are you excited by fast action and try to call every pivot? Are you only concerned with the bigger time frame moves (15 minute and higher)? Do you actually use news and earnings reports to make trade decisions, and then stick by that analysis? There are many other questions like this – but one thing is usually true: As a trader, you cannot be king of the mountain on all of these. You need to pick a style to concentrate on. 90% of your trades should be in this style. Most of the time straying too far from that style will lead to losses.

The reason this happens is the human brain can usually only focus its energy on what you are most excited about doing. If that is buy and hold, you will bring that mentality to trading bot.com" target='_blank'>day trading – and inevitably decide to turn a short term trade into a long term hold through logic and reasoning. None of which the market cares about. It affects your stock selection, risk tolerance, price targets and a whole host of other factors that go into trading. Know your strengths and play to them – this does not mean ignore the other methods, what it means is you cannot be a jack of all trades and expect to excel equally at them all. The same goes for trading securities – rarely do you see day traders who trade bonds, futures, currencies stocks, index ETF’s and options all at the same time. Most of the successful guys pick one of them to make most of the dough at – do they dabble in the others – sure – but they have a game plan and concentrate on mainly one thing.