Daytrading systems and techniques are in abundance on the internet. This brief article will concentrate on the very basics of technical daytrading. The home based daytrader is competing against large institutional traders, hedge funds, market makers, and computer algorithms. Before entering the daytrading arena, the trader must be prepared. The competition has at their disposal powerful computers armed with high tech algorithms. High frequency trading programs operate on miniscule profits and massive numbers of trades.

The good news is that these super fast trading algorithms add liquidity to the markets. The bad news is that all these computers are not on the same page, creating some pretty strange price action scenarios. So, how in the world can the little home based trader compete with the supercharged, high tech, mega bucks commercial traders?

The answer to this question is quite simple and based on common sense. No matter how powerful these computers are, they still function by a set of rules. These trading rules are programmed into the computer by humans. These programmers use the same rules that are available to all traders. The rules of trading are sometimes bent and rarely broken.

The average home based trader can learn these basic rules and compete successfully with the big boys. Of course, extraordinary fundamental events can be the exception to the rules, but as far as the ordinary, average trading day is concerned, these basic rules remain in effect for all players.

The technical analysis of any market is based primarily on price, time, and volume. These are the only variables we have to work with. All trading systems are created using these three variables. Systematic, rule based trading is the only way the at home trader can compete with the large traders. The rules transcend all timeframes and are just as valid in the one minute time frame as they are in the daily, weekly, or monthly timeframe.

The rules are simple and every trader should know them. The most commonly used rules are support and resistance, Fibonacci retracements, trend lines, and moving averages. The at home daytrader must take the time to learn these rules and how to implement them. Before entering the battleground of day trading, arm yourself with a simple plan and a clear mind

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The financial markets are risky. Investing is risky. Past performance does not guarantee future performance. This article has been prepared solely for informational purposes and is not a solicitation, or an offer to buy or sell any security,currency, or asset. Opinions are based on historical research and data believed reliable, but there is no guarantee that future results will be profitable.

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