The Moving Average
This video teaches how to make 20 pips in a day through day trading. The lot size and risk management are critical factors for achieving a 20 pip profit. Proper use of indicators, like moving averages, is essential for finding entry points, and one should avoid overtrading. Once you have a trade that makes you 20 pips of profit, you can essentially live off that one trade per day. Risk management is vital to success in day trading.
How to Day Trade: Making 20 Pips a Day
Day trading can be a challenging and risky venture, but for many traders, it is a way of life where they make their living. While there are many methods for day trading, many traders aim to make 20 pips per day. In this article, we will discuss the steps you can take to achieve this goal.
Step 1: Determine Your Account Size
When starting day trading, it is important to know your account size and how much you need to make in order to achieve your goal. If you have a $1,000 account and you only want to make 20 pips a day, you will need to have a successful trade with a profit of at least 4%. The same goes for larger account sizes of $10,000 or $100,000.
Step 2: Calculate Your Lot Size
Once you know how much you need to make, you can calculate your lot size using the ForexTime calculator. This calculator will help you determine the size of your trade in order to achieve your profit goal while limiting your risk to 2% per trade.
Step 3: Analyze the Market
To achieve your daily goal of 20 pips, you will need to analyze the market to find profitable opportunities. Using indicators such as moving averages can help you identify entry and exit points for your trades. You may also want to use session breaks to see how much the price moves each day and identify patterns in the market.
Step 4: Execute Your Trade
Once you have found a profitable opportunity, it is time to execute your trade. Be patient and wait for the right entry point, taking note of any potential risks or fake outs. Once you enter your trade, be sure to set your stop-loss and take-profit levels before you walk away.
Step 5: Practice Proper Risk Management
Regardless of how confident you are in your trade, it is crucial to practice proper risk management. Limit your risk to 2% per trade and never risk more than you can afford to lose. By using a one-to-two risk-reward ratio and proper risk management, you can afford to lose two days in a row and still break even if you win on the third day.
Conclusion
Making 20 pips a day through day trading is a realistic goal for many traders. By following these steps and implementing proper risk management, you can achieve this goal and live off of your daily profits. Remember to be patient, analyze the market, and execute your trades with care.
