Day traders are, by popular opinion, the market pros. They’re masterful analysts who can both work fast and tolerate high risk. And while it’s not easy to become one, the rewards are well worth it.
“Markets are constantly in a state of uncertainty and flux, and money is made by discounting the obvious and betting on the unexpected.” — George Soros, Open Society Foundations Founder
While you’re holding a devaluing coin, day traders sold it near the top. While you consider buying a new token, day traders have already done it ten times. They trade fast and with confidence because they have a system they trust.
You may wonder: why is day trading so attractive when so many of them fail? Because day traders can make big bucks overnight, BUT they think very differently from what beginners expect.
Decisive and Persistent
Day traders don’t second-guess themselves. They’re confident in their decisions and make them fast. And while it sounds risky, they get it right more often than not.
They don’t follow their intuition without a plan. It helps to have experience and practice. But ultimately, high-precision trades require technical knowledge and structure.
They write down the signals they need and how to respond, so when they find them, they don’t have to think. They’re persistent because they follow their method even when it doesn’t right.
Tolerant to Risk
Making money day trading is easy. Knowing when to sell is hard. Especially in crypto where everything seems to grow.
Day traders make money by managing risk. They know when they’re wrong, how to stop losses, and when to let go. Which sometimes means to step back and close the trade in the red.
So they’re early for the next opportunity, ready both emotionally and financially.
Day traders make money from fast price changes. Thus, the right coins need to be volatile and big enough, ideally moving sideways.
In the top 30 list, that’s Stellar, Ripple, Ethereum, Bitcoin Gold, and Litecoin (all of which allow leverage).
For higher volatility, day traders can check microcap coins under the main ecosystems. Such as PolkaBridge (on DOT), GameSwap (on AVAX), or Enjin (on ETH).
If you want even more risk-reward, consider the DOGEs and SHIBs.
Day Trader Pros
Day traders don’t need to wait days to find out if they’re right or wrong. They can make money within minutes if they make the right decision. Which can be pretty complex.
Still, day traders are willing to learn technical analysis and train their skills. Because results come FAST, they are willing to research projects in depth and watch prices daily.
Despite the entry barrier, skilled day traders don’t do much thinking. Once you choose a strategy and make a few trades, decisions happen automatically.
Day traders (at least HFTs) train themselves to make split-second decisions. They follow their intuition based on everything they’ve learned and experienced before. Because they don’t overthink, they don’t fall for emotional trading mistakes.
Small Error Margin
Because day traders work fast, they respond to trends on time. Swing traders and holders, for example, would lose more money on a stop-loss order. They don’t want to sell if the trend reverts up, so they set a lower price limit.
Even when day traders lose money, it’s no big deal. They cap their loss at a minimum price (< 2% loss), and if it happens, they sell. They don’t wait for a trend reversal, and they’re not afraid of exiting, because results come fast.
There might be another coin opportunity just a few minutes away.
Day Trader Cons
Successful day trading relies on precision. If you think more hours make more money, you’re only risking a bigger loss.
Whether it’s investing or life decisions, people make better choices when they make few decisions. Every decision you make has a higher chance of error than the previous one (due to decision fatigue).
So if you lost money day trading today and want to keep trying, odds are against you. If you’re going through hardship in life, that also affects your accuracy. Especially as a beginner.
Unpredictable Trend Changes
If day traders want to make money, they need to be ok with being wrong. If the market goes against your projections, you need to let go of your expectations, accept, and adapt to change.
Even if you don’t understand why.
Sometimes, it’s the strategy. Maybe you’ve proven a 70% success rate after hundreds of trades. So you keep using it, even if it fails five times in a row for no reason.
Day trading requires analysis knowledge and skill. And it gets harder the more money you try to make.
A $100K day trader doesn’t need more than a 1% raise to make good money. But if you start with $1000, you may need 4% just to break even (due to transaction fees). If risk equals reward, four times more growth involves 4x risk.
The higher the risk, the more precision (and skill) you need. If experts rarely risk over 2%, how can a beginner aim for more with less experience?
How to play on your strengths as a day trader?
Technical analysis is common in day trading, although not exclusive from DCAs and holders. Fundamental analysis helps too, although it doesn’t account for volatility.
In crypto, it’s possible to get a positive chance of return only using technical analysis. Day traders will make money if (1) they choose the right coins and (2) focus on chart analysis. While they can still lose, the odds are on their side (if they keep trading).
To everyone’s surprise, day traders don’t know about coins as much as you would expect. Even though they spend the most hours in the markets. Why?
It’s because they don’t need to know it all. They just need a bit of basic knowledge and then focus their attention on the few coins they trade. It’s this focus that puts them one step ahead.
They don’t catch many opportunities. But when they do get one, they get there first.
Like DCAs, day traders trust their strategy (even if proven wrong in hindsight). They make money by managing risk.
If the trade makes them profit, they’ll sell gradually until they’re only trading with extra money. They don’t risk the original sum, because it could backfire on them.
If it doesn’t go well, they may come back later in the day or try another coin.
What blind spots to watch out for as a day trader?
Long-Term Trend Review
Even as a short-term game, long-term variables affect day trading success. Whether it’s market cycles or project fundamentals, a “proven” strategy may stop working in a few months.
When day traders do the same every day, they get used to believing what made them successful will continue to work. When it might be better instead to step back for a day and review the overall landscape.
Day traders gain motivation from instant results, which can be a double-edged sword. Still, that doesn’t mean you make money every single day. Even with the highest chance of success, your strategy can fail you many times in a row.
How do they respond when not making money for days?
It’s tempting to trade more hours and be more aggressive. When it’s totally ok not to profit sometimes.
Especially as a beginner, it may seem that there’s only one way to day trade. High-Frequency Trading, like in movies. But if you always need to trade within seconds, there’s not much room for strategy.
As the name suggests, day traders can hold for as long as a day. Trading hours specifically. And according to FINRA, the minimum rules are 4+ trades in the last five business days.
Day trading isn’t necessarily a reflex game.
With so many choices, how do you find the best crypto strategy? Whatever it is, it only works if you apply it. To do so, it has to match with how you think:
Day traders don’t need strategic advice, as it’s what they do well naturally: technical analysis, project focus, step-by-step planning. But they do need to watch out for uncertainty.
Sometimes it takes 2 minutes to make $500, sometimes it’s two hours. Sometimes you have a long losing streak with a working strategy. As long as they keep calm and adapt for the long-term, day traders can potentially become the highest earners in crypto.
When you play on your strengths and plan for weaknesses, you give yourself the best possible chance for success.