Best day trading strategy 2023 - start trading at nextmarkets

Last updated: 28.02.2023
Dominic Hawker
Dominic Hawker
CFD & Trading
> 30 years

Whatever, wherever or however you trade, you are exposing yourself to financial risk, but for a lot of day traders, that is all part of the thrill.  Pretty much like riding a rollercoaster on a daily basis wouldn’t be inaccurate.

If you enjoy a busy and adrenaline-fuelled lifestyle, then day trading might just be your forte.  But before you get too carried away and sign up to the first broker on your Google search page, let’s take a look at the right way to get into day trading and talk about a day trading strategy.

Trade now commission-free

nextmarkets investors

  • Important factors for day traders
  • Start of day trading strategy
  • Risk Management Strategy
  • FAQs

What is day trading?

Let’s start with what it is not.  You will often see day trading packaged into the same box with swing trading for some reason.  So we will start by briefly defining each for you just to clear up any misconceptions you might have.

Day Trading

This is a specific style of trading that involves opening and closing trading positions within the same trading session.  There is also a subset of day trading called intraday trading, which includes a further trading style defined as scalping.

Swing Trading

Whilst swing trading does sometimes include taking short-term positions, it is not reliant on them.  Swing traders often have trading positions open for several days, or even weeks.  The strategies that swing traders use are different to a day trading strategy and not interchangeable.

Day trading - nextmarkets

What are the important factors to consider for day traders?

Aside from selecting assets that inspire you to do your research, there are two essential ingredients that you do not have control over and are irrelevant to the day trading strategy you employ: liquidity and volatility.


Asset liquidity dictates how easy it is to trade an asset at a price reflecting its true value.  That last part is fundamental to day traders, where your profit margins are tight and a few pips is the difference between profit and loss.  Trading skills can offset some deviation in prices, but without a reasonable amount of liquidity you will not be able to find the right trades at the right prices.


Often when you see a market described as ‘volatile’ it seems to be in a context that suggests volatility is a bad thing.  In fact, it is completely the reverse; it is a must for day traders, who can find opportunities that do not exist when the market is stable. 

About Strategies

There is no one-size-fits-all strategy for different trading styles out there.  A Forex trading strategy which requires in-depth technical analysis of the financial sector, for example, will be radically different to a swing trading strategy for stocks, where fundamental analysis has an equal importance.

Not only that, always bear in mind that no matter how well a specific strategy works for one day trader it may not reap the same rewards for another equally experienced trader or for you.  It is always best to look at a strategy in terms of how it could be adapted to suit your purposes.

Below are some tried and trusted day trading strategies that you might want to take a closer look at.  Even if none of them fit your particular needs, hopefully they will give you plenty of ideas to start developing your own.

Trend trading strategy

Trend trading is one of the most-used strategies, but is also one that you must embark on with an open mind.  As the name suggests, it revolves around following market trends over a period of time using largely technical analysis, making it a great day trading strategy for beginners to learn and absorb the markets.

There is no room in this strategy for ‘gut feeling’ or having favourite assets, all that matters when you use this strategy is the way your candlesticks are going that is all-important.  Even if it really goes against the grain, you must stick to the rules and follow the trends in the direction they are going.

Within the bounds of a trend strategy, you could do far worse than buy Apple stock when the time is right, it is one of those assets that always seems to be hitting the right notes. There are one or two things you can do routinely to optimise this strategy, both of which boil down to research.  The first is the pre-market trend and to catch that, you will need to be up very early in the morning, at least an hour before opening time.  

The second is being alert to any breaking political, economic or financial announcements as they can blow a trend completely out of the water.  Finding a free stock trading app with built-in alerts can be invaluable for keeping up with the latest news.

Assess each news release individually and in context to the appropriate market.

CFD trading - nextmarkets

News trading strategy

Although news trading has some similarities to trend trading it is more suited to volatile markets and suits traders who are able to react immediately to announcements.  It is the favoured day trading crypto strategy precisely for those reasons.

As the name suggests, it involves constant and consistent monitoring of every available media channel, including social media and relevant forums.  News travels fast and getting a ‘heads up’ from an unofficial source can be a crucial turning point to averting a loss or turning a bigger profit.

Although it would be quite difficult to find a good time to buy Tesla stock  if you have committed to a news-related strategy, as none of us knows what Elon Musk will think up next, but that is an exception. Experienced day traders can work this strategy to the level where they will react to a rumour before an official announcement has even been made, but we don’t recommend that everyone tries that method.

Never underestimate the influence of social media channels.

Start of day trading strategy

Start of day is much-favoured, both as a day trading stocks strategy and a day trading Forex strategy.  It works on the premise of the activity that takes place immediately after the markets open for the day, with traders making decisions based on pre-market research and similarities. For example, it is probably not the ideal time to buy Netflix stock when yet another subscription price rise has just been announced.

The main reason for traders adopting this strategy is that it takes considerably less time to maintain than some others, although this is a matter of opinion.  Naturally there are potential pitfalls, because as a day trader it is always ideal to be continuously monitoring your positions throughout the day.  

If you do decide to try it, it is essential to have sufficient knowledge to implement risk management orders, like stop-loss and take-profit and use them to their best advantage.

It is essential to be fully conversant with technical analysis and market sentiment.

nextmarkets best CFD broker

Strategies that you need to avoid

The strategies that we have detailed above are just a small representation of many, very valid day trading strategies you might want to study and perhaps try out for yourself.  There are also some that it is best to avoid altogether.

If you search online for ‘day trading strategies’ you are certain to come across a number of search results that make certain claims like ‘guaranteed profits’, ‘make $1000 every day’ or even ‘how to be a day trader without lifting a finger’.  

Let it just be said that these are not even worth clicking on.  At worst you may have stumbled on a scam, at best you will simply be directed to the website of a broker to sign up.  It’s always best to avoid free ebooks as well, inevitably you will need to provide an email address and the only benefit will be an inbox full of spam.

Risk Management Strategy

Many potentially talented day traders have lost their entire capital by failing to implement a robust risk management strategy into their overall trading plan.  These are just two of the ways for you to avoid becoming another statistic:


For every trade you enter, there is an optimum time to exit and the penalty for getting it wrong will most likely lead to sustaining a loss, which could be substantial if you are trading on a margin.  

That is why it’s always wise to have a reasonable understanding of the various different types of orders you can use to complement your overall day trading strategy, but there are two that you need to know inside out and use religiously, stop-loss and take profit.

A stop-loss order automatically exits a position, at the level you set, where it is no longer prudent to continue keeping the position open.  It does not preclude a loss, it simply minimises it to an acceptable level.   

Conversely, a take-profit order defines the point you deem appropriate to exit a position with a profit, albeit a small one.  Never change your mind once you have made a decision in an attempt to enhance profits further, it rarely works.


Implementing a percentage rule and sticking to it rigidly is another good habit to develop.  The exact percentage you select will be dependent on the extent of your total capital, but 1% – 2% is plenty for the average trader to risk on a single trade.

Should you be lucky enough to have a substantial account balance at your disposal, then the risk per trade should be reduced further, perhaps as low as 0.25% – 0.5% being more than sufficient risk to expose yourself to on a single trade.

Our final thoughts

What it boils down to is deciding for yourself what type of day trading strategy suits you.  One way or another, you are going to be spending a lot of time delving into the inner workings of your asset of choice, so it’s best not to develop a day trading crypto strategy if you have no faith in that market and your passion is the stock market.

We cannot tell you categorically that the best day trading strategy requires you getting up at 5.00am if you are not a morning person, or telling you to stay up half the night to comply with a specific day trading Forex strategy we happen to think is the best thing since sliced bread. 

It is a very personal thing and one that only you can decide on, depending on the time you have available, what interests you and what you ultimately hope to achieve from day trading.


Day Trading Strategy - FAQs

✨ What is the best day trading strategy?

That is a very open-ended question and one that has no definitive answer.  If you are undecided about the best way to approach day trading, or the steps you need to take to find a strategy that works for you, then why not head over to our platform where you will find a huge number of helpful guides that are certain to put you on the right track.

🎯 Can I use EA and robots for day trading?

For certain styles of day trading automation software can be a very valid addition to your trading platform.  To find out how, when and if you should use it, head over to our site and take a look through our extensive guides which cover platforms, software and strategies too.

📉 Is swing trading the same thing as day trading?

No, swing trading is quite different to day trading in several fundamental ways.  One of our trading guides covers that subject in some depth, along with plenty of other essential advice including strategies for any potential day traders out there.  You can find it here and read it completely free of charge.

💲 I have sufficient capital in my trading account, how much should I risk on a trade?

That question cannot be answered in simple terms as the answer depends on a number of factors.  Those include the total amount you have, the fees your brokerage will apply to the trade and the asset applicable to that trade.  We suggest that you read some of our trading guides, which feature plenty of trading strategy advice as well as the best ways to manage risk.  All are available to read for free at our top trading platform.

📆 How often should I use trading orders?

There are lots of different orders you can make use of to enhance your day trading experience and there are two that are vital to include in your risk management plan.  If you need more guidance, head straight to nextmarkets where you will find plenty of information about orders and many other day trading subjects.

Smarter Trading
  • Trade with Europe's commission free online broker
  • Receive up to 200 professional analyses per month
  • Trade more then 8000 shares, ETFs and other products
Start trading now