Not everyone is cut out to be a day trader in the foreign-exchange markets. That’s because a true day trader enters and exits trades within a day’s time. A day trader VERY rarely holds a position for several days.

I meet many newbie currency traders who want to become day traders. But just like many people would love to race cars or model professionally, you need certain prerequisites to be a day trader.

Day traders are also strictly technical traders. They love charts. That’s because there’s really nothing fundamentally that moves currencies over 30 minutes to an hour or so periods. It takes time for fundamentals to affect currencies. And time is exactly what day traders DON’T have. So they’re all about the indicators, short-term timeframe charts like the five minute and 15 minute timeframes.

Day traders may trade fundamental news announcements but they’re only looking for the short-term pops that react to the news. They’re not looking for news items that will affect the long-term fundamentals of a currency.

You have to know that when you enter into the day trading arena. That takes incredible skill, and not everyone can learn to do it. In fact, most people can’t. However, if that’s your long-term ambitions, it doesn’t mean you can’t go for it. But I compare it to becoming a pro athlete, rock star or professional actor. People jump into those amazing careers everyday, even if it’s not a huge amount of the population.

If you want to hop into the arena with the day traders, please take my advice — only use capital that you can afford to lose.

Otherwise, follow the intermediate to long-term trends in the foreign-exchange market. Leave the day trading to the professionals…who don’t have another day job.