Forex Trading
Posted in

How To Pick Stocks To Day Trade

bank of america

Tesco ​ Capable of moving several pounds a day and daily trading volume typically exceeds 15 million shares. There are thousands of stocks to trade, so many that it would be impossible for a single person to scan for opportunities. This is probably the most important tool for finding the best day trading stocks. The stock scanner can filter using the criteria that shows activity.

trader workstation platform
stock price

TradeStation’s base commission for options is in line with the industry standard at $0, while its per-contract fee of $0.60 edges out most rivals. TradeStation’s fully customizable desktop platform allows you to use tons of technical indicators, as well as create your own. And traders will likely find OptionStation Pro a valuable tool for setting up trades and visualizing the potential payoffs. With a strategy that involves so much trading, one of the primary concerns for a day trader is commissions, or how much a brokerage will charge for each trade. Regardless of whether a trade is a winner or a loser, the brokerage gets its cut either way — both on the buy and the sell transaction. So savvy traders look to save on trading costs as much as possible, because that keeps more money in their own pockets.

Our ratings take into the range of fees, features and tools offered by each online broker platform. The data and analysis contained herein are provided “as is” and without warranty of any kind, either expressed or implied. Fidelity is not adopting, making a recommendation for or endorsing any trading or investment strategy or particular security. All opinions expressed herein are subject to change without notice, and you should always obtain current information and perform due diligence before trading. For this and for many other reasons, model results are not a guarantee of future results.

The human operated chat is very convenient and something that rival Lightspeed Trading lacks. All of the customer service agents at Cobra Trading are licensed professionals, many with substantial trading industry experience. We received fast, helpful responses via phone, email and human chat. Unlike the larger firms there is no need to navigate various automated menus before reaching a live representative. Educational content is offered in multiple formats, ranging from immersive courses to videos, articles, webcasts and even live events.

Get daily investment insights and analysis from our financial experts

Either the high volume represents accumulation of the stock or distribution . Aside from its inherent riskiness, day trading is especially not worth it when you factor in the significantly higher tax rates imposed on short-term trades. Check out this step-by-step guide to learn how to find the best opportunities every single day.

  • You can use an online stock screener to find stocks that meet those and other criteria.
  • He has covered investing and financial news since earning his economics degree from the University of Maryland in 2016.
  • Day traders can choose stocks that tend to move a lot, either in dollar terms or percentage terms.
  • But just because markets are volatile doesn’t mean you can start day trading without a plan or purpose.
  • We do not offer financial advice, advisory or brokerage services, nor do we recommend or advise individuals or to buy or sell particular stocks or securities.

Rolls-Royce Holdings ​, a pound or more of price movement each day combined with a daily average volume north of 30 million shares. Glencore ​ More intraday movement than most of the others on the list due to its typically higher share price, but the stock still trades more than 30 million shares per day. International Consolidated Airlines Group ​ A stock that is sensitive to economic conditions and can have large price moves. NatWest Group ​ A stock that tends to be more stable in terms of price movement and trades more than 15 million shares per day.

Then, isolate those stocks that are relatively weak or strong compared to the index. This creates an opportunity for the day trader, because a strong stock may move up 2% when the index moves up 1%. On top of these factors, day traders may like using an online broker because they can quickly access the market with a mobile app and stay apprised of where their positions are trading. Fidelity Investments provides the core day-trading features well, from research to trading platform to reasonable commissions. The company’s flagship platform, Active Trader Pro, offers a fully customizable look while Wealth-Lab Pro, a backtesting tool, lets you test a strategy against 20 years of historical data.

Second, as you start your trading day, you can check out the companies that are making headlines. If the stock has a large volume, then more traders have been interested in it. In addition, a volume increase usually means that the stock price is about to change.

If you would like to see how we can help you further, come over to and give our market movers a shot. There are multiple ways to select the best stocks for you to day trade. Remember, trading is a journey, so don’t try to figure it all out in one day. Just make sure your scan provides you the means to trade high volume stocks with a sound system that consistently makes you money. TradingSim Market Movers PaneMarket movers inside TradingSim will allow you to pick a random day 6 months in the past and actually see what the most active stocks were for that day.

A account is an arrangement that allows an investor to deposit funds and place investment orders with a licensed brokerage firm. Bank of America’s trading volume is high, making it a relatively liquid stock. For the same reasons, Wells Fargo also makes for a very popular day-trading stock. Both of these stocks have high trading volumes and uncertain industrial conditions.

Volatility is a statistical measure of how much a price changes over a certain period of time. The higher the volatility, the greater the chance of buying a stock cheap and selling it when it gets expensive in a short period of time . Most common strategies are simply time-compressed versions of traditional technical trading strategies, such as trend following, range trading, and reversals.

Motley Fool Investing Philosophy

During a range, our drawn lines will be horizontal, not angled. The chart shows that, as the trend continues higher, the price pushes through past highs. The same method can be applied to downtrends; profits are taken at or slightly below the prior price low in the trend. Day traders should select stocks that have ample liquidity, mid to high volatility, and group followers.

What time of day is best to buy stocks?

The stock market has three trading sessions running from 4 a.m. to 8 p.m. Eastern time. The market is most stable at noon, making this the best time for beginner investors to buy shares. If you are investing for the long-term, there is no point trying to time the market.

You can move in and out of the stock with ease and generally make a profitable trade on each attempt. This should give you a feel for not only the stocks in the sector, but if they are real stock movers, and whether or not they fit your strategy. There are other high powered scanners out there, but to be honest, all you really need is a method to see the top gainers and losers. However, here at TradingSim, we offer a simplified scan filtering engine that will help empower your training experience.

How to Pick the Best Day Trading Stocks

When buying, look to exit near the top of the range but not right at the top. When shorting, look to exit in the lower portion of the range but not right at the bottom. Place a stop-loss just below the most recent low prior to entry on a buy signal, or just above the most recent high prior to entry on a short signal.

Someone has to be willing to pay a different price after you take a position. Day traders like stocks because they’re liquid, meaning they trade often and in high volume. Liquidity allows a trader to buy and sell without affecting the price much. The stock market is the most active market for day trading — particularly in the first few hours and last hour of the trading day. Day trading means buying and selling securities within a short timeframe — often less than a day — in an attempt to earn a lot of small profits.

Do day traders sell every day?

Day trading is essentially a play on the short-term volatility (or price movement) of a stock on any given day. Day traders buy a stock at one point during the day and then sell out of the position before the market closes.

It is the average points difference between the high and low of a stock over a certain period of time, normally 14 days. Even if the investor is not utilizing margin, the $25,000 account minimum applies. Thereupon, you will be required to maintain a $25,000 account minimum, or face restrictions on trading. Day trading involves buying and selling a stock, ETF, or other financial instrument within the same day and closing the position before the end of the trading day. Years ago, day trading was primarily the province of professional traders at banks or investment firms.

Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers. If you want your money to work for you, then the stock market is one of the best places to invest it. This may reflect the financial or other circumstances of the individual or it may reflect some other consideration. Viewers of T3 Live programs should take this into account when evaluating the information provided or the opinion being expressed.

risk management

Investing involves risk including the possible loss of principal. Pick two or three stocks from the list, and trade them for the week. You can customize many aspects of your search, so adjust any of the criteria as needed to get a list of stocks that are better suited to your day-trading strategy or specifications.

Best Day Trading Platform for Short Selling

Charges low commissions and fees, and offers the lowest margin rates in our tests. Margin trading entails greater risk, including but not limited to risk of loss and incurrence of margin interest debt, and is not suitable for all investors. Please assess your financial circumstances and risk tolerance prior to trading on margin. Check out this step-by-step guide to learn how to scan for the best momentum stocks every day with Scanz.


While breakouts can move independently of the market, it’s always a good idea to go in the direction of the broad market. The ask prices are immediate execution prices for quick buyers while bid prices are for quick sellers . If a trade is executed at quoted prices, closing the trade immediately without queuing would always cause a loss because the bid price is always less than the ask price at any point in time.

What market is easiest to day trade?

Day traders commonly choose the forex market for its low barriers to entry as well as exchange-traded funds. Long-term investors are often attracted to the commodities market and the market for contracts for difference.

Pairs trading – going long and short on two assets that typically move together but that have recently diverged. These are some of the stocks that you should focus on in a given day. If yours does not, you should use a tool provided by, as shown below. Likewise, volatility within specific firms can be brought on by unpredictable cash flows or surprising earnings reports. Look for companies with unsteady balance sheets and a history of earnings beats or misses.