Day Trading In Australia 2024

Online day trading in Australia has soared in popularity in recent years. Australian traders can easily find a great broker to speculate on the ASX200 (or any other stock index) or trade forex pairs like the AUD-USD. It’s never been a better time to get started with online trading in Australia, and in this tutorial we will explain everything aspiring traders need to know.

Top 3 Brokers in Australia

As of May 2024 we have reviewed over 450 brokers and have found these to be the top 3 best online brokers for Australian traders:

#1
Pepperstone
74-89 % of retail investor accounts lose money when trading CFDs
#2
IC Markets
#3
FXCC
Bonus
100% First Deposit Bonus Up To $2000

The best brokers in Australia

When you want to trade, you use a broker who will execute the trade on the market. The broker you choose is an important investment decision. Below are some points to look at when picking one:

Do your research and read our online broker reviews first. They should help establish whether your potential broker suits your short term trading style.

What Is Day Trading?

The definition of “day trading” is the buying and selling of a security in a single trading day. If you’re day trading online you will close out your position before the markets close for the day to finalise the trade result. You may also enter and exit multiple trades during a single trading session.

Brokers on occasion have different definitions for ‘active’ or day traders. Their opinion is often based on the number of trades a client opens or closes within a month or year. Some brands even refer to ‘hyper-active traders’ – a step beyond the ‘active trader’.

Day trading is normally done by using trading strategies to capitalise on small price movements in high-liquidity stocks or currencies.

The purpose of DayTrading.com is to give you an overview of day trading basics and what it takes for you to make it as a day trader.

From scalping a few pips profit in minutes on a forex trade, to trading news events on stocks or indices – we explain how.

day trader beginner or advanced

What Can Be Traded?

The most lucrative and popular day trading markets today are:

If you’re day trading the Australian Stock Exchange Index (ASX 200), you’ll be buying and selling the shares of companies, such as the WestPac and BHP.

In the day trading forex market, you’ll be trading currencies, such as the Aussie Dollar, U.S dollar and Euro. In the futures market, often based on commodities and indexes, you can trade anything from gold to cocoa.

Index funds frequently occur in financial advice these days, but are slow financial vehicles that make them unsuitable for daily trades. They have, however, been shown to be great for long-term investing plans.

Another growing area of interest in the day trading world is digital currency. Day trading with Bitcoin, LiteCoin, Ethereum and other altcoins currencies is an expanding business. With lots of volatility, potential eye-popping returns and an unpredictable future, day trading in cryptocurrency could be an exciting avenue to pursue.

Read more about different trading markets

Getting Started

Recent reports show a surge in the number of day trading beginners.

But unlike the short term trading of the past, today’s traders are smarter and better informed, in part due to trader academies, courses, and resources, including trading apps.

Daytrading.com exists to help novice traders get educated and avoid mistakes while learning how to day trade.

Day trading 101 – get to grips with trading stocks or forex live using a demo account first, they will give you invaluable trading tips.

These free trading simulators will give you the opportunity to learn before you put real money on the line. They also offer hands-on training in how to pick stocks.

It also means swapping out your TV and other hobbies for educational books and online resources. Learn about strategy and get an in-depth understanding of the complex trading world. DayTrading.com is the ideal beginners guide to day trading online.

Books for Beginners

Both books will provide you with the basic day trading rules to live by. You’ll also benefit from advice on stock picks, plus creative strategy ideas. As Benjamin Franklin highlighted, ‘an investment in knowledge pays the best interest’.

More on day trading books

Charts And Technical Analysis

Day trading chart patterns paint a clear picture of trading activity which helps you to decipher individuals’ motivations. They could highlight ASX 200 day trading signals for example, such as volatility, which may help you predict future price movements.

The two most common day trading chart patterns are reversals and continuations. Whilst the former indicates a trend will reverse once completed, the latter suggests the trend will continue to rise.

Understanding these trading patterns, as well as ‘triangles’, ‘head and shoulders’, ‘cup and handle’, ‘wedges’ and plenty more, will all make you better informed when it comes to employing your trading strategies.

Read the Guide to Day Trading Patterns.

Day Trading Strategies

Head over to websites like Reddit and you’ll see many trading dummies will often fall at the strategy hurdle, taking the first momentum examples they see and losing money left, right and centre.

Savvy traders will employ day trading strategies in forex, grain futures and anything else they’re trading in, to give them an edge over the market. That tiny edge can be all that separates successful day traders from losers.

There are a number of day trading techniques and strategies out there, but all will rely on accurate data, carefully laid out in charts and spreadsheets. Options include:

It is those who stick religiously to their short term trading strategies, rules and parameters that yield the best results. Too many minor losses add up over time.

Check your broker permits scalping or arbitrage before you trade.

Read the Guide to Day trading Strategies.

Day trading technical analysis and strategy

Trading Accounts

Part of your day trading setup will involve choosing a trading account. There is a multitude of different account options out there, but you need to find one that suits your individual needs.

The list of brokers in Australia has more detailed information on account options, such as day trading cash and margin accounts.

Terminology

Learn the trading lingo and vocabulary and you’ll unlock the door to a whole host of trading secrets. Below we have collated the essential basic jargon, to create an easy to understand day trading glossary.

General

Charts, Graphs, Patterns & Strategy

If you stumble across a word or phrase that leaves you scratching your head, refer back to this day trading dictionary and chances are you’ll get a quick and easy explanation.

Read the glossary for definitions of many more words and concepts.

Day Trading vs The Alternatives

Yes, you have day trading, but with options like swing trading, traditional investing and automation – how do you know which one to use?

Day trading vs long-term investing are two very different games. They require totally different strategies and mindsets. Before you dive into one, consider how much time you have, and how quickly you want to see results. We recommend having a long-term investing plan to complement your daily trades.

winning trader day trading for a living

Day Trading Full Time

So you want to trade full time from home and have an independent trading lifestyle?

If so, you should know that turning part time trading into a full time endeavour requires specialist tools and equipment to give you the necessary edge. You also have to be disciplined, patient and treat it like any skilled undertaking.

Analytical Software

Whilst it may come with a hefty price tag, day traders who rely on technical indicators will rely more on software than on news. Whether you use Windows or Mac, the right trading software will have:

Psychology

If you’re trading as a career you have to master your emotions. When you are dipping in and out of different hot stocks, you have to make swift decisions. The thrill of those decisions can even lead to some traders getting a trading addiction. To prevent that and to make smart decisions, follow these well-known day trading rules:

Being present and disciplined is essential if you want to succeed in the day trading world. Recognising your own psychological pitfalls and separating your emotions is imperative.

Read the Guide to Making a Living on Day Trading.

Education

DayTrading.com exists because we could not find a reliable day trading school, university, academy, or institute that runs classes where you can get an all-inclusive day trading education. This site should be your main guide when learning how to day trade, but of course there are other resources out there to complement the material:

For the right amount of money, you could even get your very own day trading mentor, who will be there to coach you every step of the way. Opt for the learning tools that best suit your individual needs, and remember, knowledge is power.

7 Secrets To Success

Whether you’re looking for jobs you can do from home, or you want to start day trading as a hobby, follow these seven essentials.

1. Setting up

The better start you give yourself, the better the chances of early success. That means when you’re sat at your desk, staring at your monitors with hands dancing across your keyboard, you’re looking at the best sources of information. That means having the best trading platform for your Mac or PC laptop/desktop, having a fast and reliable asset scanner and live stream, and software that won’t crash at a pivotal moment.

2. Keep it simple

This is especially important at the beginning. You might be interested in ASX 200, mutual funds, bond futures, Nasdaq, Nasdaq futures, blue-chip stocks, equities, or the Dax 40, but to start with focus on only one. Get good at forecasting one market/security before you branch out. The other markets will wait for you.

3. Be realistic

The movies may have made it look easy, but don’t be fooled. Even the day trading gurus in college put in the hours. You won’t be invited to join that hedge fund after reading just one Bitcoin guide. You need to order those trading books from Amazon, download that spy pdf guide, and learn how it all works.

4. Risk management

This is one of the most important lessons you can learn. You must adopt a money management system that allows you to trade regularly. Is day trading really worth it if you’ll be broke by the end of the first month?

History has shown that many successful traders never risk more than 1% of their account balance on a single trade. So, if you had $25000 in your account, you’d only risk $250 on a single trade. Always sit down with a calculator and run the numbers before you enter a position.

5. Keep a record

One of the day trading fundamentals is to keep a tracking spreadsheet with detailed earnings reports. If you can quickly look back and see where you went wrong, you can identify gaps and address any pitfalls, minimising losses next time.

6. Timing

Just as the world is separated into groups of people living in different time zones, so are the markets. If you start trading on the CAC 40 at 11:00 in Perth or Melbourne, you might find you’ve missed the best entry signals of the day already, minimising your potential end of day profit. So, if you want to be at the top, you may have to seriously adjust your working hours.

7. Sensible decision making

When you start day trading you’ll have a host of difficult decisions to make. Should you be using TradingView, Robinhood or etrade? What about day trading on Coinbase? Do you have the right desk setup? Where can you find an excel template? How do you set up a watch list? The meaning of all these questions and much more is explained in detail across the comprehensive pages on this website.

You can also find more detailed and comprehensive lessons in our top tips.

Taxes

The tax situation for day traders is entirely dependent on in which country the trader is “tax resident”. Furthermore, a popular asset such as Bitcoin is so new that tax laws have not yet fully caught up – is it a currency or a commodity?

How you will be taxed can also depend on your individual circumstances. For example, authorities look at activities from 3 different angles:

Due to the fluctuations in day trading activity, you could fall into any three categories over the course of a couple of years. Although you don’t need a license, it’s important you rigorously monitor your trades, seek tax advice, and stay within laws and regulations when filing your tax returns.

Read the Guide to Day Trading Taxes in Australia for more comprehensive information on tax rules and reporting.

How Much Money Will You Make?

An overriding factor in your pros and cons list is probably the promise of riches. We’ve all heard stories of day trading millionaires from Brisbane (or wherever) who started trading with just 1000 dollars, but soon hit the jackpot and mastered the markets. Whilst, of course, they do exist, the reality is, earnings can vary hugely.

Making a go of day trading will depend on your commitment, your discipline, and your strategy. All of which you can find detailed information on across this website.

The real day trading question then, does it really work? If you’re willing to invest the time and energy, then for you, it could well do.