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eBooks
Day Trading Techniques
Day trading is a risky
job if you enter into market and place order without any research. One can make
or loose money in a day.
A Day trader should be absolutely clear about
the amount of work, discipline, his risk appetite research, knowledge and sheer
luck that is required to be Successful.
Day Trading Techniques
for Individuals ( Must Follow )
I will Trade small.
I will not Trade without stoploss.
I will win and walk out.
Techniques
1. Trend following
Trend following, a strategy used in all trading time frames, assumes that stocks
which have been rising steadily will continue to rise, and vice versa. The trend
follower buys a stock which has been rising, or short-sells a falling stock, in
the expectation that the trend will continue.
2. Playing News
Playing news is primarily the realm of the day trader. The basic strategy is to
buy a stock which has just announced good news, or short-sell on bad news. Such
events provide enormous volatility in a stock and therefore the greatest chance
for quick profits (or losses).
3. Range Trading
A range trader watches a stock that has been rising off a support price and
falling off a resistance price. That is, every time the stock hits a high, it
falls back to the low, and vice versa. Such a stock is said to be "trading in a
range". The range trader therefore buys the stock at or near the low price, and
sells (and possibly short sells) at the high.
4. Technical analysis
A method of evaluating securities, stocks, bonds, forex, futures, options,
indexes, currencies and commodities. or any item that has a price and a market
by analyzing statistics generated by market activity, such as past prices and
volume. Technical analysts do not attempt to measure a security's intrinsic
value, but instead use charts to identify patterns that can suggest future
activity.
Technical analysts believe that the historical performance of stocks and markets
are indications of future performance.
In a shopping mall, a fundamental analyst would go to each store, study the
product that was being sold, and then decide whether to buy it or not. By
contrast, a technical analyst would sit on a bench in the mall and watch people
go into the stores. Disregarding the intrinsic value of the products in the
store, his or her decision would be based on the patterns or activity of people
going into each store.
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