Day trading strategies: the complete guide with all the advanced tactics for stock and options trading strategies. Find here the tools you will need to invest in the forex market

Ditching Correlations
We can define correlations as a relationship where one thing influences the
outcome or behavior of another. A positive correlation means that both tend
to move in the same direction or exhibit similar behaviors, i.e., when one
goes up, the other goes up, too, and vice versa.
Correlations abound in the stock market. For example, returns on the stock
market are usually negatively correlated with the Federal Reserve’s interest
rates, i.e., when the Feds increase interest rates, returns on stock market
investments go down and vice versa.
Correlations exist across industries in the stock market, too. For example,
property development stocks are positively correlated to steel and cement
manufacturing stocks. This is because when the property development’s
booming, it buys more steel and cement from manufacturing companies,
which in turn also increase their income.
Ignoring correlations during day trading increase your risks for erroneous
position taking and exiting. You may take a short position on a steel
manufacturer’s stock while taking a long position on a property
development company’s stock and if they have a positive correlation, one of
those two positions will most likely end up in a loss.

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But caution must be exercised with using correlations in your day trades.
Don’t establish correlations where there’s none. Your job is to simply
identify if there are observable correlations, what those correlations are, and
how strong they are.
Being Greedy
Remember the story of the goose that lay golden eggs? Because the goose’s
owner was so greedy and couldn’t wait for the goose to lay more eggs
immediately, he killed the goose and cut it open.
Sadly for the owner, there were no golden eggs inside the goose because it
only created and laid one golden egg every day. His greed caused him to
destroy his only wealth-generating asset.
When it comes to day trading, greed can have the same negative financial
impact. Greed can make a day trader hold on to an already profitable
position longer than needed and result in smaller profits later on or worse,
trading losses.
If you remember my story, that was greed in action. Had I been content
with the very good returns I already had and closed my position, my paper
gains could’ve become actual gains. I let my greed control my trading and
chose to hold on to that stock much longer than I needed to. That trade
turned into a losing one eventually.
That’s why you must be disciplined enough to stick to your day trading
stop-loss and profit-taking limits. And that’s why you should program those
limits on your platform, too. Doing so minimizes the risks of greed
hijacking your otherwise profitable day trades.

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