Day Trading Tools – Introduction
To be successful in any field, you need a number of day trading tools which help you make good decisions. As a graphic designer, you need tools such as Adobe Photoshop. As a search engine optimization expert, you need tools such as Google Analytics. As a project manager, you need tools like Asana.
In trading, you need a number of day trading tools which will help you make the best decisions to enter or exit the trades. These trading tools need to be accurate which is achieved through backtesting. They also need to be affordable to the traders. In this article, I will highlight five important day trading tools that are freely available in the internet. These trading tools are free and can save you a lot of time.
#1 – Oanda Currency Correlation
Correlation is a very important day trading tool for traders who use arbitrage and hedging techniques. The idea of this technique is to buy and sell instruments that move either in the opposite or in the similar direction. To identify these instruments, you need to calculate their correlation. Correlation is a complex mathematical calculation that can take a trader a lot of time. It involves finding the data and entering it in Excel or SPSS and then calculating. Worse is that it changes with time. This is where the Oanda Currency Correlation tool comes in. All you have to do is to visit the website and check out the correlations.
#2 – Fibonacci Calculators
The concept of Fibonacci retracement is very common among technical traders. Traders use Fibonacci retracement to identify support and resistance points. When the chart hits the support, the traders know that it is the time to buy and when it hits the resistance they know it’s the time to sell. Calculating the Fibonacci sequence is a relatively complex mathematics. Therefore, innovative Fibonacci calculators have been developed. All you need to enter is the high and low positions and then the calculator will work out the levels for you. A simple calculator can be found here.
#3 – Pip Value Calculator
A pip is the smallest value a currency can move. Understanding how to calculate the value of a pip is very complicated. Moreover, you don’t need to do the calculation because you can find a calculator to help you achieve this. In a pip value calculator, all you need to do is enter the currency pair you want to calculate, the position size, ask price, and value in US dollar. After this, the value of the pip will be produced. A pip value calculator can be found here.
#4 – Pivot Point Calculator
This is a tool used mostly by technical traders. As a technical trader, you need to be at a good position to identify the pivot point. This pivot point will help you identify the support and resistance points. For starters, identifying these pivot points can be a really difficult thing. That’s where the pivot point calculator comes in. This calculator helps a person identify all the pivot points by just entering the high, low, and close prices. An example of a pivot point calculator can be found here.
#5 – Drag and Drop Quant Tools
Quant trading involves coming up with a software or algorithm to help you open or close the positions. To be a pro in quantitative analysis, you need to be extremely good at software development languages such as MATLAB. Unfortunately, many traders don’t have these skills. Therefore, many brokers such as FXPRO have developed a platform that allows anyone to create his own algorithms by dragging and dropping the day trading tools. This enables anyone without any experience to come up with algorithmic day trading tools that are of the best quality.
Day Trading Tools – Useful Links
- Find more day trading tools on AdvisoryHQ