Best Trading Hacks for Beginners and Advance Trader | Haresh Patel

Best Trading Hacks for Beginners and Advance Trader

If you're starting in the stock market, so these hacks will help you build a solid foundation, manage risks, and increase your chances of success.

1. Start with a Demo or Paper Trading Account

• Why: Helps you practice without risking real money.
• Hack: Use it to test your strategies, understand market movements, and build confidence.

2. Follow the Rule of “1 to 2% Risk per Trade”

• Why: Protects your capital by limiting how much you can lose in a single trade.
• Hack: Calculate the amount of capital to risk (e.g., if you have ₹1,00,000, risk only ₹1,000–₹2,000 per trade).

3. Use the Power of Moving Averages

• Why: Simplifies market trends and helps identify entries/exits.
• Hack:
  • Use a 50 EMA for trend direction.
  • Combine with a shorter EMA (e.g., 9 EMA) for crossovers to confirm entries.

4. Always Check Volume

• Why: Price movement without volume often leads to false signals.
• Hack: Enter trades when the volume is higher than the last few candles (indicating strong momentum).

5. Start with Fewer Indicators

• Why: Too many indicators can confuse you.
• Hack:
  • Stick to 1–3 basic indicators like VWAP, RSI, and EMA.
  • Learn their behaviour and add complexity later.

6. Trade with the Trend

• Why: It's easier to make profits when you're trading in the direction of the market.
• Hack:
  • Uptrend: Buy on dips near support (e.g., EMA or VWAP).
  • Downtrend: Sell on pullbacks near resistance.

7. Avoid Trading in the First 15 Minutes

• Why: Markets are volatile at the open, and prices can be erratic.
• Hack: Wait for the initial volatility to settle and trade after identifying a clear trend.

8. Focus on High-Liquidity Stocks

• Why: Stocks with low liquidity can have unpredictable price movements.
• Hack: Stick to index-based stocks like Nifty 50, Bank Nifty, or blue-chip stocks for consistency.

9. Keep Emotions in Check

• Why: Emotional decisions can lead to overtrading and losses.
• Hack: Use stop-loss and take-profit orders to automate exits and avoid emotional decisions.

10. Learn Before You Earn

• Why: The more you learn, the fewer mistakes you'll make.
• Hack:
  • Follow trusted financial websites, YouTube channels, or trading mentors.
  • Read books like "Trading for a Living" by Dr. Alexander Elder.

11. Use a Journal to Track Trades

• Why: Reviewing your trades helps you learn from mistakes and refine strategies.
• Hack: Record:
  • Entry and exit points
  • Reasons for the trade
  • Outcome and learnings

12. Avoid Overleveraging

• Why: Leverage magnifies both gains and losses.
• Hack: Use leverage conservatively (e.g., 2x or 3x) until you are confident and experienced.

13. Understand Risk-to-Reward Ratio

• Why: A good R:R ensures you make more on winning trades than you lose on losing trades.
• Hack: Only take trades with at least a 1:2 risk-to-reward ratio.

14. Focus on 1–2 Markets Initially

• Why: Diversifying too early can dilute your focus and results.
• Hack: Start with a single index (e.g., Nifty or Bank Nifty) or a couple of large-cap stocks.

15. Avoid News-Based Trading

• Why: Market reaction to news can be unpredictable and cause sudden spikes.
• Hack: Wait for the news impact to settle before trading.

Just Quick Golden Rules for Beginners

• Cut Losses Quickly: Accept small losses and move on.
• Let Profits Run: Don’t exit winning trades too early.
• Stick to the Plan: Follow your strategy without impulsive decisions.