Stock Trading Information

A day trading is simply a transaction where you buy shares of stock and sell them to make profit within minutes or hours. Day traders from all over the world look for volatile stocks so they can make profit. Each day companies release news, earning reports, or other catalysts such successful late stage trial which bring interests of retails traders to take trades on the stock. A day trader is not a long-term investor rather he is a trader who buy and sells stock within a short period of time. Day traders understand the risk and rewards when trades with volatile stocks.

 Analyze Risk and Reward

As a day trader you must know your risk and reward. Most of the day traders blow up their accounts due to lack of risk management. They do not understand when to get in and out from the trade. Unfortunately, new traders lose their money day after day not knowing how to manage risk. For instance, they risk $100 to make $50 or risk $500 to make $250. This is one of the biggest reasons day traders lose money. They do not understand risk management. We will teach you how to manage your risk when you take trade and become profitable.

 Proper Stock Selection

Stocks do not move by itself. It is the people who move the stocks. When it comes to trade, a day trader must know which stock to trade. Your job is to find what other traders or mobs will do today. Even though day traders know how to manage their risk but if they do not trade the right stocks, they will lose money. Every day you will see some stocks move 20% to 100% or even more. Each morning I find these stocks before they make big move. As a day trader your job is to catch a fraction of that move and make money.

 Going Into Trade

Before getting into trade, a day trader always must consult with the chart. A good chart pattern is required for day trading. A day trader must know the chart pattern such as bull flag, support and resistance along with other traditional patterns. You need to know your stop loss that is when to exit. You just cannot blindly enter into a trade and do not know when to get out. This is recipe for disaster. If there is no good stock to trade, do not trade on that day. You do not have to trade every day. Do not chase it. You will have another chance.

 Win Big and Lose Small

There are four outcomes from day trade, big or small win, and big or small loss. You need to cut your loss small, and run big. The secret of winning big for a day trader is being disciplined. Do not allow emotions take control of your mind. If you are emotional, you will blow up your day trading account. As a day trader my goal is to generate consistent income of $1K per week. I usually trade when I see proper setup.