Day Trading For Dummies, 4th Edition

Chapter 7

Planning Your Trades and Trading Your Plans

IN THIS CHAPTER

Organizing your business

Planning trades to start your day

Making short-term and long-term choices

This chapter may be one of the most important chapters in this book. Day trading isn’t a mad frenzy of order entry, nor it is a software package that you can buy, set, and forget. If you want to be successful, you have to put some time and attention into your trading. Before you trade, you need to think through what you want to do and how to do it. Afterward, you want to evaluate what you did and whether to do the same thing next time.

The best traders have plans for their trades. They know in advance how they want to trade and what they expect to do when they face the market. They may, at times, find themselves deviating from their plans, due to luck or circumstance or changing markets, but in those cases, they understand why they’re trying something else. Even experienced day traders make notes about their trades. In fact, the planning is what allows a novice day trader to stay in the game long enough to become experienced.

Trading comes in many flavors, and many of those who call themselves day traders are actually ...