Looking for the best day trading software for beginners? Unfortunately but not surprisingly, many new traders make the mistake of either signing up with the wrong broker or downloading the wrong software platform. Or worse yet, both. Each can be fatal mistakes to any trader, new or old. That’s not what’s best for you. So listen up! We want to steer you back on course. That’s why the importance of picking the right day trading software for beginners can’t be overstated.
Table of Contents
What Is the Best Day Trading Software for Beginners?
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- ThinkorSwim: great over trading platform and software tool to analyze stocks
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- Interactive Brokers: good overall trading platform for day trading & options
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- Tradingview: Awesome free charting platform
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- Investing.com – awesome free app with news, charts, data, economic calendar
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- FlowTrade – algo monitoring software for block trades, dark pools and algo buying
Day trading is overwhelming when you’re new. Just like anything else that involves your money or your time, it can feel like a mountain to climb. You’re getting in and out of trades pretty quickly. As a result, you have to to know when the moves are potentially coming.
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Potential Moves
Day trading software for beginners can be a tool to help you find potential moves to trade. Therefore, stock scanners and trading companies have a lot to offer.
Each trader’s style and strategies different. Therefore, what works for someone might not work for you. It might take some trial and error to find the perfect day trading software for beginners. Before you can use software however, you need to make sure you know how to trade. Our stock market courses teach you the ins and outs of trading.
The Most Important Features of a Trading Platform and Broker
As day traders, we need fast and flawless order execution platforms and brokers as our entry and exits are literally often only one or two seconds apart. And people often wonder how we do it so fast?
The answer is: cutting edge trading platforms with a direct-access broker at your fingertips. Before you run out and sign up with a brokerage firm and download the trading software, ensure it offers the following:
- Fast trade execution
- Hotkeys
- Smart route configurabilty
- Level 2 data
Don’t forget to check out our day trade watch list for stocks to trade.
Fast Trade Execution
Part of day trading software for beginners is finding the right platform to trade on. The most important characteristic of a trading platform for active day traders is the ability to get in and out of trades quickly.
Because in day trading you might hold your shares for very short times only. And sometimes a second more or less can cost you valuable cents (which multiplied with your share size can translate into $100’s of dollars).
You need to get a platform that (1) features hotkeys; so you don’t have to manually type in your price and share size before placing an order.
But can just push a predefined button and (2) is as closely linked to the market as possible. Check out our live trading rooms to see us talk day trading live.
Hot Keys
If your broker doesn’t use a platform or software that has hotkeys, you’re not going to get in and out of trades fast enough. You need quick execution with a fast order execution platform.
Which is why I highly recommend a good broker with a fast order execution platform like DAS TraderPro. Historically ThinkorSwim has had the reputation of slow executions and not a good platform for day traders.
However, the platform has Hotkeys and recently they have made considerable efforts to provide fast and seamless transactions. ThinkorSwim’s charting abilities are bar none.
The best day trading software for beginners doesn’t work if you can’t chart your stocks.
What Apps Do Day Traders Use?
Smart Route Configuration
Most beginner and intermediate traders tend to use the default standard electronic routing their brokerage firm offers. This may be fine for swing traders and passive investors but not for active day traders.
Because every broker has an internal default routing system you might have problems with liquidity. It’s recommended you get acclimated to manual routing if you’re using a direct access online broker.
Direct access routing puts you in control to get the best and quickest liquidity as well as earn potential commission rebates.
Take Interactive Brokers for example. They’ve created a “Smart Routing” system to provide traders with lightening fast execution speeds. Which means for you as the trader, the best fill on your option or stock with the goal of immediate execution.
Unfortunately, TD Ameritrade does not offer this direct access. That’s why we recommend to stick with their charting (Thinkorswim) but use a different broker for execution.
The bottom line means pay attention to how day trading software for beginners route trades.
Level 2 Data
Level 2 data essentially is the order book for NASDAQ stocks and can provide enormous insight into the price action of a stock. In simple terms, a level 2 window is split into two sections – the bid side and the ask side.
The bids, shown on the left, show the total number of shares that buyers want to purchase at a certain price. You’ll notice the bid side is arranged in descending order; the highest bids are on the top and the lower bids following immediately below.
Conversely, the “ask side,” is on the right. It shows you the total number of shares sellers wish to sell at the corresponding prices. Opposite of the bid, the ask side is arranged in ascending order with the lowest ask at the top with the higher prices below.
Since the Level 2 quotes update in real-time, it’ll help you determine the short term direction of a stock which can be extremely helpful. For example, a lot of orders being filled on the “ask” side might indicate the stock is heading higher in price.
Mainly because buyers are rushing to grab the available shares at higher prices. Conversely, if you have more orders being filled on the “bid” side, it may mean the stock is ready to fall because sellers are willing to dump their shares at lower prices.
With a subscription, you will have access to Level 2 data which can give you a detailed insight into what direction the stock is going to take. knowing exactly who has an interest in a stock can be extremely useful, especially to day trading.
Summary
Like most things in life, if you want the cream of the crop, you need to pay for it. This includes data fees, the software itself and the hardware (i.e. computer) that’s powerful enough to run the software.
Luckily, once you invest in the proper hardware the rest is easy. Personally, once I saved up for the best trading laptop I could afford, I was off to the races. Thinkorswim needs some decent power to work properly, so don’t skimp here. The same goes for your internet speed. DSL is not going to cut it!
If you need more help, take our day trading course.
