But it all boils down to a day and intraday trading. These are somewhat like short-term and long-term investing.
So what is considered day trading?
Let’s talk about the whole day trading concept. This way we can answer all your questions and not just “what is considered day trading”.
What is Day Trading?
Day trading is a strategy that revolves around the process of buying and selling batches of securities within the day. It takes advantage of price fluctuations without requiring a waiting period. Checkout our Day Trading Software Bundles HERE
What Is Considered Day Trading?
Diving deeper, there are many approaches to the strategy of day trading rules. We’ll discuss a couple of them that we highly recommend for day trading for beginners.
And just before we start, you may ask “what is a day trader salary” or “is day trading profitable?”.
Well, day trading has a 10% success rate. This makes it profitable but not enough to depend on, it’s more of an alternative source of income. Speaking of income, day traders make an average of 56 dollars per hour.
A short-term low-maintenance strategy like this being profitable surely makes the public wonder “is day trading legal?”. It certainly is, and here are examples of day trading approaches you may use in the future:
- Scalping: this strategy produces a number of small profits from the minimal price changes that occur within the day. The small price fluctuations paired with a huge amount of securities produce a considerable risk-based profit.
- Pattern Trading: One of the most common questions is “what is a pattern day trader?”. And the answer is simple, a pattern day trader executes four or more day trades within a margin account over a period of five days.
- Range Trading: This is a day trading strategy that equips support and resistance levels in prices to determine their buy and sell decisions.
- Reverse Trading: Also known as pull-back trading, reverse trading is taking advantage of the market’s reversal trends. Most reverse traders use technical analysis to predict the market’s movements.
- Momentum Trading: This is the most basic day trading strategy. It enters positions when securities have strong prices and high volumes and exits once the momentum disappears.