A World of Money at Your Fingertips
Having an online broker account can afford you a total sense of power. All of them offer the traditional personal help for a price. Some online brokerages will give out free advice, however, as always, the decision whether or not to trade is left totally at your discretion. For the novice, the easiest ways to get involved with on line trading is with stocks. As a beginner you must be made aware of the stock market vernacular. Day trading is trading that from the moment you take a position to the second the transaction is complete, only one trading day has elapsed. This may seem very obvious to most of us, however, there are so-called experts who lump all online traders into the bag of day trading. For the sophisticated observer it is plain to see the obvious differences. A day trader rides the rush of the asset, while a swing trader diagnosis the trends and holds onto it as long as the momentum last.
Anyone who is just getting their feet wet with online trading should begin as a swing trader. With the proper software you can swing trade while keeping your job or enjoying your retirement. Swing trading is traditionally considered a low risk venture, especially for those who trade the large cap stocks. But is there really such a thing as low risk in these volatile times? Some experts will tell you that swing trading only works in a stable market, where the prices don’t fluctuate, but I feel that if you are properly trained you can make money no matter what the market is doing. So how much investment capital should you have? To quote the investment companies disclosure, and I’m paraphrasing; “never invest more than you have to lose.”
It is important to set a limit on how much you plan on trading with, and the amount you are comfortable with losing. It is like gambling, make no mistake about it. However instead of just rolling the dice, putting your chips all on lucky 7, or hopelessly watching the little pea spin around, you can learn what is the equivalent of counting cards. For example, the term stop loss is one that you should know and understand its meaning before placing any position. It is the amount of money you are willing to bet that you are right about your decision to get in when you did. If you are long, than the stop loss is placed just under lows it has already reached. That way if the stock goes south your losses are kept at a minimum. There are three basis fundamentals, I believe that every foundation for sound trading should be built upon. Knowledge Training Software
Knowledge is Gained by Experience
Proper Training Will Lead to a Successful Experience
The only thing that separates an intelligent person from an expert is knowledge. Let us assume that you have some knowledge or you wouldn’t be researching the market. Any training you receive should be for technical analysis, or you are just wasting time and money. They are many facets to technical analysis, but the one I’d like to touch on briefly is candlestick charting. When I first started trading, it was the one part of training that is the easiest to comprehend. Don’t get me wrong. It takes a keen eye and patience to master it. For those of you not yet familiar with candlestick charting, I will try to give a brief but accurate explanation. The Chinese invented the market concept, and the Japanese perfected charting techniques with the use of the candlesticks. It is easy to understand this complex system, if we simply break it down to the ticks on the chart you follow every day. We know that the lower tick is where the stock opened and the higher is where it closed. Now if we made the two lines parallel and connected them, what would we have? A candle. However, during that movement, the stock might have gone lower or higher then where it opened or closed, so our candle has formed a tail and a wick. Is it starting to make a little sense to you? Can you see the advantage of knowing this information, for getting in and out, and setting a stop loss?
Your Software Platform Should Be Technically Sound
Four Ways to Ensure Profits
As far as software platforms, the following suggestions I strongly feel are necessary for any software to be useful.
1. It must be able to offer live streaming technical data. (Otherwise the program is merely educational)
2. The platform should defiantly include candlestick charting.
3. Visually it has to be large enough for all the data to be seen easily. (Many of the online brokerage’s technical data are too small to be useful)
4. It must be cost effective. (Most good systems can be purchased for between one and two hundred dollars)
I don’t profess to being an expert, but I do know of some. I obviously don’t have the time to go into all the details now, but at my site Market Mentalist you will find all you need to know about investing online. There is access to some of the top trading systems available including software, books, newsletters, and Forums. Whether you are an inquisitive novice or a seasoned pro Market Mentalist offers the online investment resource you just might be seeking.
