Posted by forex at 8:12 AM
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1. Look for liquidity and volatility in a stock. Liquidity allows you to enter or exit a stock at a good price. Volatility gives you a feel for the expected daily price range. Research both these factors and develop your entry plan.
2. Research Intraday Candlesticks Charts so you can analyze the action of the price. Look specifically for the low price of the day, a spike in volume of traders and open orders. Your goal is to sell your stock when interest wanes.
3. Determine a Stop-Loss strategy for every stock you purchase. Set a price at which you are ready to sell your stock and also keep a mental note of when you might want to go out depending on the action. Don't forget to factor in commission fees and taxes.
4. Keep an eye out for Hole-in-the-Walls. This term is used to define the end of an upward or downward trend, potentially about to reverse. Hole-in-the-Walls are frequently good entry points for day trading.
5. Play with NASDAQ if you want to see more action. It tends to be more volatile than other markets, such as NYSE and AMEX.