Investing in the stock market is a great way to grow your wealth over time. But if you want high returns, to make money riding the ups and downs of the market, day trading could be a great alternative. Read On!
Day Trading Tips for Beginners
Interested in day trading? Read this post for some expert tips that are sure to help every new day trader in Dubai and the UAE.
While share market investment offers the highest returns potential, day trading could also be highly rewarding. Unlike stock investments that are made for months and years, day trading or intraday trading involves opening and closing your positions within a single day.
In the last few years, day trading has become a popular trading style in the UAE. If you are interested in intraday trading, then here are some expert tips that are sure to help every beginner-
1. Start with the Right Trading Platform
Your day trading journey will begin with a trading platform. It is the trading platform where traders analyze stocks and other securities before placing their trades. While there is no shortage of online trading platforms in Dubai, you should select one offered by a reputable broker or investment solutions provider.
MT4, TradeRoom, CQG, and TWS are some of the most popular platforms used in the UAE. You can select a company that offers access to multiple trading platforms so that you can choose one that best suits your expertise and requirements. Ensure that the platform provides access to a large number of global equity markets and securities.
2. Choose a Preferred Security
While day trading in stocks is the most popular in the UAE, you can also day trade a host of other securities, including forex, commodities, CFDs, cryptocurrencies, and more. As you are just starting with online trading in UAE, it’d be better if you choose any one security that you find most interesting.
After gaining some experience in the selected security, you can then experiment with others. Some of the top investment solution providers in the UAE also offer research and consultancy services to help their customers generate higher returns.
3. Understand the Popular Day Trading Strategies
There are several time-proven intraday trading strategies that are used by traders across the world. Some of the most popular ones used in the share market in Dubai are Scalping, Momentum Trading, Breakout Trading, Pullback Trading, News Trading, and Trend Trading.
While the ultimate goal of each of these strategies is to help a trader find profitable trading opportunities, it will take some time, knowledge, and experience to master them. Thus, choose one or two popular day trading strategies and try to learn more about them.
Some of the brokers also offer demo accounts for practising. The demo account could be an excellent place for testing strategies before using them in the real trading account.
4. Know the Popular Indicators
Indicators are tools used for technically analyzing securities on charts and predicting their future prices. They are based on mathematical calculations that consider the volume or price of the security. RSI (Relative Strength Index), MA (Moving Average), and MACD (Moving Average Convergence Divergence) are some of the most popular indicators used for online trading in Dubai.
Like trading strategies, it’ll take some time for a beginner to understand and master these indicators. You can combine a trading strategy with these indicators to maximize return potential. Use a few popular indicators in your demo account to understand how they work and the signals they generate.
Beginners should also note that no trading indicator is fool proof. There is no guarantee that the market or price of a security will move as per the signals generated by any indicator.
Starting Your Day Trading Journey in the UAE
Patience is the key to becoming a successful day trader. While there are several strategies and indicators that could help improve your winning rate, it ultimately depends on the skills and expertise of the trader.
As a beginner, it’d be wise to start with a demo account, where you can understand how the market works and the risks associated with intraday trading.
When you start trading with a real account, start small and build your way up as you gain more knowledge and experience. The assistance of a reliable trading platform and broker in the process cannot be underestimated.