1. What is day trading?
1. Day trading is the act of buying an asset at a lower price and selling within the same trading day in hopes to make a profit on that asset. These assets can be stocks(WMT, APPL, ex), Cryptocurrencies ($LINK, $ETH, $BTC, ex), or even precious metals like gold or silver. No matter the asset the goal is, all the same, to buy low and sell for a profit.
(1) Example; Jimmy buys Ethereum($ETH) because he hears on the news that a major US bank will now use the token to pay international fees.
Jimmy buys 1 $ETH token at 3000 USD
Mass amounts of people rush to buy $ETH after hearing the announcement on the news
The price of $ETH shots up 20% making it worth 3600 USD
Jimmy sells $ETH and collects 20% profits on his initial investment.
(2) Example; Jimmy has been studying charts
Jimmy sees Chainlink($LINK) will start an uptrend
Jimmy uses his knowledge of the charts and buys 1 $LINK token for 30 USD
$LINK continues on an upward trend and shots up 33% in 4 hours and is now worth 39.9 USD
Jimmy sells and collects 33% profits on his initial investment.
These examples demonstrate two profitable and successful day trades. one showed day trading based on opinion or outside events and another day trade based on knowledge of trends and charts. Note that it could have been the other way around and Jimmy could have lost money.