Day trading definition refers to the practice of buying and selling a financial instrument within the same trading day, with the goal of capturing...

Day trading definition refers to the practice of buying and selling a financial instrument within the same trading day, with the goal of capturing short-term price moves. Unlike swing or position trading, day traders close all positions before the market closes to avoid overnight risk. This style is common in stocks, forex, futures, and crypto, and it relies on speed, discipline, and a repeatable strategy. Traders often use real-time charts, Level II quotes, and news feeds to spot momentum, breakouts, and mean-reversion opportunities. Risk management is central: tight stop-losses, position sizing, and clear rules help limit downside. In the U.S., pattern day trader rules require at least $25,000 in a margin account if you execute frequent day trades. While day trading can be exciting and potentially profitable, it also carries substantial risk and is not suitable for everyone. Understanding the day trading definition helps you set realistic expectations, choose appropriate tools, and build a learning plan before placing your first trade.

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