One method of entering longer running trends is day trading. Given that a working entry strategy is paramount for trend trading, this alone is the ultimate right to exist for day trading.
Trend trading is married with using a stop loss strategy, and using a stop means finding the right entry spot. Otherwise the stop technique will produce too many and or too big losses. So, using day trading methods to enter trends in order to get safely on growth stock runs, is a logical move.
The day trading for long trend entry symbiosis can be turned upside down. Growth stocks like to be swingy, because the market is always unsure about their future potential. If it were different, all growth stocks that finally will hit their eternal goal were priced to their mature value already. The many more that disappoint eventually would be priced relatively next to zero. They all should not move much any more.
Such a financial market would have to be full of wise prophets and wizards. But reality differs slightly and so we have tremendous price swings up and down. Look at them in hindsight and wonder why you have always been so sure about the future of some stock!
For our day trading system we choose growth stocks that also show a large upwards trend or at least a huge longterm volatility. Downswings are explicitly allowed. What stocks do in the long run has to be mirrored on a daily basis. These swing trading stocks are also the right ones for day trading.
If the volatility of a stock in the time frame of weeks is great, chances are that the intraday coherency is also above average. In other words, intraday trends are more common. In the daily bar chart we notice more often bars with the open and close at extremes.
For instance, in an uptrend there tend to be more day bars with the open near the low and the close near the high. This is what the day trader should be searching for. Enter shortly after the open and ride the stock into the close. It really can be this simple!
Add a stop or a trailing stop and close the trades at the end of the day when you come back from the beach. Right, with this simple trading automations even the beach trader can do day trading. Moreover, if a position is already a substantial gain, our beach trader can decide to hold on to the growth stock instead of just day trading it. He then proudly can consider himself a beach investor.
