Stock Trading - How To Choose Stocks For Investment Trading
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Posts: 121,297
Joined: Mar 2014
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Post: #1
02-14-2018 04:39 AM

I have found that the very best stocks for share trading and day trading will be the stocks that constitute the S&P 500. The reason behind this is that the large Mutual Funds and large Institutional Buyers focus on these shares in their constant quest to beat the S&P 500. These stocks usually have complete performance and strong general strength to-the S&P 500 Index. Of the shares, I love to focus on those who come in the Nasdaq 100 Composite Index. It's the Nasdaq stocks that I like to deal the most because of their volatility of the stocks in the Nasdaq 100, I focus on those stocks that I that I like to refer to as 'trading where the motion is' stocks. These are stocks that show remarkable size in the number of shares being exchanged through the day, at the very least 1-5 million shares and preferably 20 million shares and more. My true preference is share volume of 30 million plus each day.

Additionally, the shares must have a big daily stock trading variety, which is the distinction between the high price and low price of that stock for the previous trading day, and plenty of volatility. I look for a trading range of a minimum of $2.00 per-share, but I really prefer those that are more unstable and have an everyday travelling range of $3.00 to $6.00 and more.

The reason for this is that I trade the long side, both both sides of industry and the small side on an intra-day basis. I've no interest in whether the inventory closed in positive, or negative property the prior day, in the same way long as the price and volume activity exist.

All I want is the price action, high-volume and the volatility. If I have these three materials, I know that they are either increasing, or decreasing and the major participants are very effective in that stock their weighting in that stock. Adding to and causing the cost and volume activity are what I call the 'accelerators', which are the push players, the pro-gram traders and the hedge funds who are looking to jump in before the mutual funds and front run the investment, either up, or down. That is if the action really heats up and you'll see 'climatic volume' where each stock trade is happening in less than a second. I've seen this many times every single day. It happens all the time.

Something that may not be clear to you on top is that what I have done when I pick stocks for stock trading is as my re-search department that I've used the major participants. Because most organizations are on the same page when it comes to the things they are buying and selling the money flow is extremely apparent. This shows up in the price action, the volatility, and volume for your shares in-play. It is very difficult for a herd of elephants to hide their foot prints in the mud.

Now with a list of stocks to trade. I then load these stocks in-to my 'trading and investing' watch record. Along with that watch list I have yet another watch list that contains every share in the Nasdaq 100. Seeing the quantity, value action, If the market opens I spend the first 5-minutes or therefore, and direction of the stocks in both watch lists.

I'm looking for certain styles to produce and if I see a pattern that I want to day trade, I'll pull the trigger and get the trade, both on the long side or the small side centered on what the stock (price action and size) inform me, what I see the market-makers performing on the Level II screen, and offered the stock is trading consistent with the information of the Nasdaq 100.

I will have a fairly limited defensive stop in position to safeguard me just in case I am wrong and took the trade too soon. I may attempt that industry a few times before I get the right access, every time going for a small drop. Nevertheless when I get the right access, there's plenty of money to be made, specially when you are in the right stock.

One of the things I like to do is to stick to the exact same stock, so long as it satisfies my stock trading needs. The same stock may be traded by me all week as along as it's doing for me and I'm making good successful deals with it. One of many benefits in doing this is the fact that you really get to know the inventory effectively, and how it trades.

To recap, I think the top stocks for trading are those stocks with very high rate and high volatility, high quantity and an excellent intra-day travelling range. When you have these qualities, you know the large institutions and the 'accelerators' take part in the stock.

For stock trading, you will require a direct access morning trading account from the stock trading agent that provides direct access stock trading software. This is a total must have for day trading. The software could have Level II, maps, technical signs, etc. Direct access implies that your buy and sell orders are sent straight to industry by you without using a middle man to position the orders for you..

The very first thing you should do before you even try stock trading, and this is even if you do have some experience, is to take a good day trading class so that you really understand how the business of stock trading works, what designs to find, how the markets function and how everything fits together. It'll be the best investment you ever make. If you don't eductae yourself - you've much better than a 90-days chance of failing.

* the words stock trading and day trading are compatible.

Good luck and good trading,

The Maverick

Larry Schade. Discover more about more information by browsing our fine article.

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