Learn Day Trading Strategies To Help Establish Better Returns

What is your day trading strategy? Perhaps you focus primarily on one technique, or maybe you trade a few different ways. It’s always good to learn more as an investor. Let’s take a look at some of the various day trading strategies out there so that you can get a firmer grasp on how to grab those bulls by the horns, pardon the pun.

Bears don’t have horns, so just keep that in mind. To be sure, you can make money off of a declining market, but watch out. The people doing that often have a considerable amount of cash to invest and a lot of patience. Patience is a virtue and must be developed, and it is also something that, when it comes to investing, may come easier to those who have lot of money and aren’t as worried about losing it.

Have you heard about momentum trading? This is quite your typical strategy. If you look at stocks on the popular Zacks website, you will see a grade for securities based on momentum. No matter what type of an investor you are, it’s good to know the momentum of a company. On the Zacks website, the momentum grade is one that isn’t posted for any given particular day but just as things stand with the company.

As a day trader, however, you are going to want to know what that stock is doing that day. Most stocks don’t move up or down more than 5 percent. Keep that in mind as you learn about when to jump on the wagon so to speak. If you jump in there when a stock has already moved up 5 percent, well, you might have just bought high. That is the problem with momentum trading.

Of course, if a security has quite the momentum, not just for the day, then it could continue to be on the rise. You’re a day trader though, and you’re trying to find the picks that are moving up that day, not losing you money on any given day. One thing you can also do is look for those stocks that dip.

When jumping on the bandwagon, you might find yourself buying high. But when buying when a security isn’t as popular and is being sold, then you might end up buying low more often. Of course, a stock can always dip further. You might want to look and see if a particular stock is what’s called ‘oversold.’ Also, you’re going to want to of course look at a whole bunch of other metrics, different charts and get familiar with candlestick patterns, too.

There is also the scalping strategy and the pullback trading strategy, which is kind of what I touched on already. Yet when employing the pullback strategy, you’re going to want to be sure that you look for trends. Breakout trading and news trading are also popular strategies. Be sure that you look at how you can combine strategies, too, and see what other day traders have to teach you.

Check Out These Day Trade Strategies

Day trading isn’t for the faint of heart, and you can lose money just as fast as you can make it. This is why you need a good strategy, but don’t worry because we’ve put together a short list of popular day trading strategies. With that said, feel free to give the following a try or find reviews of stock trading.

The Momentum Strategy

This strategy involves jumping on stocks that are on the move. When the price of a stock moves up, you jump on it. However, when you use this strategy, there are certain things to look for.

For starters, look for news that could cause a stock to start moving upwards. This can include unexpected earnings growth, a new treatment launched by a drug company or news that a larger firm is about to acquire a smaller company. Things like these can start moving a specific stock.

Also, look for stock movement of between 30 and 40 percent. Besides that, use tools that can help you spot trends and ideas. The more tools you use, the better your chances are of succeeding with the momentum strategy.

The Breakout Trading Strategy

This type of trading strategy involves buying a stock when the price of a stock goes above its previous resistance price. However, this strategy is a bit difficult because you simply don’t look at a chart and then make a trade. It requires a bit of work. What you want to do is keep an eye on the trading volume of a stock or how many shares are being traded because when breakout trades happen in high volume, then the chances are the stock will become more sustainable when it continues to rise in price.

News Trading

Previously, we mentioned how news can drive the price of stocks up, or down, but you can use a trading strategy that involves keeping an eye on the news related to business. Stocks can react rapidly to both good and bad news, so pay close attention to it. In fact, you should check out the news on a daily basis.

If bad news is coming out, then you might want to short a specific stock. However, if there is good news coming out about a specific company, then check out their stock and consider buying a few shares. The more you do this strategy, the better you’ll get at spotting news that you can use to your advantage.


This strategy consists on focusing on making small wins because all of the small wins you make will add up to more money when the day ends. What you want to do is set a target to buy a stock and when to sell it, so you’re doing things that are predetermined. You need to be prepared to make trades fast because this strategy requires fast thinking and decision making. The good news is if you become good at this strategy, you could end up doing very well.

Feel free to do additional research on each strategy. You never know, one of those day trading strategies could end up working for you. Remember, nothing is guaranteed when it comes to trading, but sometimes all it takes is one strategy to help you out.