Day Trading
Opening and closing positions within one day — high risk, requires experience.
Day trading is a trading style where all positions are opened and closed within one day — no overnight exposure. The goal is profiting from short-term price movements.
Characteristics:
•Timeframe: 1min, 5min, 15min charts
•Number of trades: 3–20 daily
•Screen time: 6–8h daily
•Leverage: 5–20x typically
Required skills:
•Fast chart reading and price action
•Emotion management under pressure
•Strict discipline (never move stop-loss)
•Understanding market structure
Statistics:
•70–90% of day traders lose money long-term
•Barber et al. study: only 1% of day traders consistently profitable over years
•Algorithmic bots have advantage in execution speed
Costs:
•Taker fee accumulates — 0.04% × 10 trades × 252 days = 100%+ annually
•Funding rate on leveraged positions
Before starting day trading:
•Learn technical analysis thoroughly
•Trade on paper trading (demo) 3+ months
•Define clear entry and exit rules