Forex Day Trading: Everything you need to know 

Forex Day Trading is one of the most popular trading strategies experienced and veteran traders use. The process involves a significant amount of risk. So learning about its rules, stimulator, and software is essential to stay profitable.

Forex day trading

What is Day trading?

Day trading is a short-term strategy involving buying and selling financial assets within a day. Simply put, buying and selling the instrument occur on the same day. 

Day traders use fundamental analysis, such as news and trends and technical analysis, such as charts and patterns, to make trading decisions. This strategy is used in forex, comex, crypto and the stock market. 

A quick glance

It is the process of buying and selling currency pairs on the same day to take advantage of short-term exchange rate fluctuations.

News Trading, Breakout trading, Trend trading, Countertrend trading, and Mean reversion are popular forex day trading strategies.

Yes. You can earn upto 1 lakh in day trading. However, your profit depends on many factors such as risk, strategy, currency pair, trends etc.

  • Not Giving Importance to Learning
  • Emotional Decision taking
  • Placing multiple trades
  • Ignoring Analysis methods
  • Ignoring trading strategies

Day Trading in Forex

Forex Day trading is the process of buying and selling currency pairs on the same day to take advantage of short-term exchange rate fluctuations Forex day trading for beginners is a difficult process. It requires market knowledge, high risk and quick decision taking ability. A trader must monitor daily trading patterns, news and market trends to limit losses. 

Day trading forex vs stock

Day trading in stock is the buying and selling stocks within a day. Meanwhile, day trading in forex is exchanging currencies within a day.

Both processes involve high risk, watching market factors, news, and trends. 

However, stock day trading is less popular than forex day trading. 

You can trade in currencies on the same day as currency rates frequently change even in minutes, but prices change less frequently in stock market. 

Also, a deep understanding of companies and their sectors whose stock you are trading is necessary for stock day trading.

Day trading strategies

Forex Day trading rules

Limit your trade: Day trading is a risky process. The bigger the trade numbers, the bigger the risk. So do not make more than three days per day. Limit the number of trades and stay profitable.

Pattern day trader rule: There is a rule by the US regulating authority FINRA. According to the rule, a pattern day trader has at least $25,000 in their margin accounts on any given day. 

Margin Rule: A day trader has to follow the margin requirement rules set by the Forex brokers platform. The rule limits the leverage amount, and traders must maintain a margin requirement.

Forex day trading strategies

News Trading: The buying and selling decisions based on current news that may affect financial trading, such as political turmoil, economic reports, technological development, stock market news, etc.


Breakout trading strategy: Similar to the name, it is the process of buying and selling currencies when the price breakout a support or resistance level. The main aim is to take advantage of a rapid price change.

Trend trading: It is the process of trading in the direction of trade. A trader determines the trend by continuously analyzing the charts and other technical indicators. 

Countertrend trading: It is just the opposite of trend trading. A trader continuously watches the charts and other technical indicators to determine the trend and trade in the opposite direction of the trend. However, it is quite a risky process.

Mean reversion: It is a strategy based on theoretical rather than technical analysis. It is based on the concept that prices will tend to revert to their historical mean. Under this, a trader buys below and sells above the mean.  

Momentum trading: It is the process of trading in the direction of price movements. Buying occurs when there is a strong upward movement, and selling occurs when there is a strong downward movement.

Scalping: It is a popular day trading strategy; scalpers place multiple trades over some time. It can be of few seconds or minutes. Generally experienced and advanced traders use this method as the risk is very high.

Forex day trading common mistakes

Day trading in forex is not an easy process. With the amount of profit, the amount of risk is also big. Here are some common day trading mistakes that cause a huge trading loss.

Not Giving importance to learning: Trading in forex already requires various skills, especially for a day trader. It is a must to understand the forex market. 

When a trader starts trading daily without understanding the basics of day trading, the chances of loss increase. You have to learn about all the day trading stimulators and strategies and how they work. 

Emotional Decision taking: Trading based on instinct is dangerous, especially during day trading. Day trading requires logical decision-making, discipline and patience.

Generally, forex traders’ decisions and strategies are affected by their instinct, greed and fear. That is why 95% of traders lose money in the forex market. So, emotion management is a must in day trading.

Placing multiple trades: Generally, traders increase their forex day trading income by placing multiple trades daily. Remember, numbers of trades are not a guarantee of profit; you may suffer a loss instead of a profit.

So go for quality over quantity. Less good quality trades are better than more poor quality trades. Also, it will be easy for you to monitor the trades and market factors affecting the trades.

Ignoring Analysis methods: Day trading is affected by many fundamental, sentimental and technical analysis factors. So use the best forex trading software with powerful analytical tools. 

Use charts, forex signals and other technical analysis indicators to determine the entry, exit, stop loss, take profit, support and resistance points. 

Ignoring trading strategies: If you are trading without a solid plan, that is a big mistake. Developing a good trading plan comprising risk management and money management strategies is important.

Your plan must consist of the number of trades you can make, the currency pair you trade, the tools you use and other important factors.

How to start forex day trading

Here is a step-by-step procedure to start day trading and make money in the forex market.

  • Educate yourself about the forex market and its workings, and learn the day trading basics. Study the market factors and learn to read charts and other technical analysis tools. 
  • Select a forex trading platform to start trading. A Best day trading platform provides education and training materials, demo accounts, and customer support services. 
  • As we have studied above, many day trading strategies exist, such as position, range and scalping. Select the best trading strategies that suit your needs.
  • Develop a trading plan which determines the amount of money you will invest and that you are ready to lose. A well-defined trading plan is a blueprint of how, when, and where your trade will execute.
  • Start practicing day trading: It is a step-by-step procedure. First, start practicing with a demo account and evaluate the result. After this, start trading with a real account with a small amount. You can then start trading with a bigger amount if your success rate is good. 


If you are wondering if day trading is profitable, then the answer is yes. You can earn upto 1 lakh in day trading. However, your profit depends on many factors such as risk, strategy, currency pair, trends etc. 

You can make as well as lose money in forex day trading. Remember, day trading is not suitable for all. Positive psychology is a must for day trading. Discipline, patience, logical trading, and risk management skills are necessary for day trading.


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