The stock market has always been a difficult area to get into as a beginner. Like any business, it requires an investment, whether in time, money or energy. When you start trading, it is normal to have trouble finding your feet, and knowing where to start and how to get by.
In this article, the editors take a look at the best daytrading tools for beginners in order to provide the ultimate guide to improving as a daytrader.
What is daytrading?
Before getting started, we should revisit a basic idea, the definition of daytrading. It is a trading technique that consists of taking a position on a financial asset and reselling it within the following hours (preferably before the end of the current session). It is based on analysing changes in the price of a financial asset during a single day.
Aiming for quick gains by placing the right bets is one of the ways of trading in high volatility financial assets, and that is what daytrading is all about. You will remember that volatility is a tool that allows you to monitor and measure changes and fluctuations in the value of an asset. It therefore provides essential information about the risks involved. The more an asset fluctuates in a short period of time, the higher its volatility.
Daytrading is therefore based on speculating on the possible fluctuations of an asset and aims to maintain a positive balance at the end of the day. It is one of the most profitable types of trading, if practiced correctly, because it allows you to minimise losses easily.
The Best Daytrading Tools
In this article, we take a look at five of the best free daytrading tools available to beginners in intersessional trading. Of course, until you fully master the basics of daytrading, it is important to avoid making unnecessary investments and to understand the value of free tools, which will enable you to navigate the world of the stock market.
Tool N°1: Investopedia
The first tool in our selection of the best daytrading tools is one that is essential to those starting out in the stock market, and even traders more generally, and that is Investopedia.
This site is actually an encyclopedia that will explain all the technical terms and concepts that you need to master in order to correctly read the characteristics of a share and to analyse the information so that you can identify whether buying a financial asset is a good bet or not.
Investopedia is the tool you should turn to whenever you come across a term you don’t recognise (and it’s important to never ignore a metric just because you don’t know what it is).
Tool N°2: Stockcharts.com
The second tool that we want to introduce you to is Stockcharts.com. This website provides a general view of the history of a financial asset’s fluctuations. In addition to providing an overview of the evolution of this asset on the market in real time, the site offers a simple, easy-to-read and minimalist interface, which is important for good statistical analysis.
More indicators about the asset can be displayed by hovering over a point of the evolution curve with the mouse. These indicators can be personalised depending on the trader’s needs. For daytrading, the default parameters will suffice, and they will enable you to look at a simple moving average interval (SMA) of the current day. For traders looking to speculate over the long term, it is also possible to look at more advanced parameters such as the Ichimoku Cloud and the MACD.
The reason we prefer this tool, beyond the fact that it is easy to navigate, is that it allows you to get a good overview of the fluctuation intervals of financial assets before even logging into its trading platform.
In summary, Stockcharts.com is:
- A tool that is easy to read and navigate,
- A curve showing the evolution of financial assets over the short and long term,
- An analytical tool that offers indicators that can be adjusted to the needs of each trader,
- A great way to get an overview on a financial asset.
Tool N°3: Finviz
Finviz is a tool that allows you to keep up to date with the latest financial market news and more specifically, the news on the market in which you wish to trade. This site offers you a global overview on the state of the various financial asset markets (health, pharmaceutical, automotive, etc.) and allows you to see the summary of each asset at a glance.
When you arrive on the home page, you will have access to a list of the markets and financial assets on which there have been the most gains during the day and the most losses. Finviz is useful when it comes to identifying which markets are worth considering before you even start looking into shares and financial assets. This considerably reduces the range of possibilities and therefore saves valuable time on the stock market.
Finviz also provides a list of all the news headlines for the day. In trading, you have to stay up to date with world news because it can have a drastic impact on the evolution of a share’s value and its volatility.
Finally, Finviz has an asset screener that you can use free of charge an that brings together all the shares that match your criteria and displays them to you in the form of side-by-side evolution curves. The benefit of this is that you can make a quick visual comparison without spending time looking at the details of each share.
In summary, Finviz is the tool par excellence for efficient trading and is an essential part of a daytrader’s day.
Tool N°4: FixyTrade
FixyTrade is a performance analysis platform that helps you grow as a trader and enables you to achieve better scores, improved performance and therefore bigger gains.
As a beginner, whether trading in general or daytrading specifically, FixyTrade uses different parameters and indicators to present you with an easy-to-read analysis of your performance on trading different shares and financial assets, all while enabling you to take a detailed look at one or more of these performances, establish comparison criteria and/or modify the time interval used.
In practical terms, FixyTrade is a learning tool that allows you to track the development of your performance on the market, which is essential if you want to understand your shortcomings and work on them. It also offers you the option of setting weekly or monthly goals, which will push you to invest in your training as a trader, all while receiving feedback on your actual level based on tangible and objective criteria.
This platform is aimed not only at beginners in trading, but also at traders who have lost their good reflexes and want to get back into the swing of things. It is a very useful tool for establishing trading strategies that work, testing them, and modifying them accordingly. It aims to improve how you think about your actions and assets whilst assessing your efficiency and the profitability of your actions.
In summary, FixyTrade is a platform that you should look into if you want to improve your skill level and join the big leagues. FixyTrade is proving to be one of the most useful learning tools.
You can test FixyTrade for free by clicking here.
Tool N°5: Thinkorswim platform
The last trading tool in our selection of the best daytrading tools is the thinkorswim platform. This platform allows you to trade live completely free of charge.
It provides access to an asset scanner. Of course you must remember that because it is a free platform, the tools offered by Thinkorswim will be limited in comparison to a paid platform.
However, what is available to you on their site is more than enough to get stared in daytrading, especially if you combine it with the various tools presented above.
But what we really want to talk to you about is its “on demand” option. This option allows you to analyse assets over a certain interval and to buy them at their value in the past by selecting the date and time you want to return to in order to retrieve shares at their previous values.
This is a very good exercise to help you learn how to manage the value of shares and better understand the returns on investment. By practicing with this tool, you will acquire the real skills that you will need in order to become a good trader, especially in the field of daytrading.