I have found that the most effective stocks for day trading and share 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 within their constant quest to beat the S&P 500. These stocks generally have strong general strength and absolute performance to the S&P 500 Index. Of the stocks, I like to focus on those who are in the Nasdaq 100 Composite Index. It's the Nasdaq stocks that I like to deal the most for their volatility of the stocks in the Nasdaq 100, I concentrate on these stocks that I that I like to refer to as 'trading where in fact the motion is' stocks. These are stocks that show great size in the amount of shares being traded during the day, a minimum of 1-5 million shares and preferably 20 million shares and more. My real desire is share amount of 30 million-plus every day.
In addition, the stocks should have a big daily stock trading range, which can be the difference between the high price and low price of that stock for the previous trading day, and a lot of volatility. To compare more, consider checking out: wholesale markus heitkoetter. I locate a trading range of at the least $2.00 per share, but I really prefer those that are more unstable and have a regular travelling range of $3.00 to more and $6.00.
The reason behind this is that I trade both sides of industry, both the long side and the short side on an intra-day basis. I have no interest in whether the inventory closed in positive, or negative territory the previous day, just as long as the volume and price activity is there.
All I want is the price action, high volume and the volatility. I know that they are either increasing, or decreasing and the major participants are very active in that stock their weighting in that stock, if I've these three elements. Increasing and contributing to the cost and volume action are what I call the 'accelerators', which are the push participants, the pro-gram merchants and the hedge funds who are trying to jump in before the mutual funds and front work the investment, either up, or down. This is if the action really heats up and you will see 'climatic size' where each stock business is occurring in under another. I have seen this often each day. It happens all the time.
One thing that might not be apparent to you at first glance is that what I have done when I pick stocks for trading is as my re-search department that I've used the key participants. Because most companies are on the same page in terms of what they are buying and selling the amount of money flow is very obvious. This appears in the volatility, the purchase price action, and volume for that stocks in play. It is very hard to get a herd of elephants to cover their foot prints in the mud.
Now having a possible list of stocks to trade. I then fill these shares into my 'trading' watch list. As well as that watch list I have another watch list that contains every stock in the Nasdaq 100. Seeing the volume, price action, If the market opens I spend the first 5-minutes or therefore, and direction of the stocks in both watch lists.
I'm searching for certain styles to build up and if I see a pattern that I want to day trade, I will pull the trigger and get the trade, both on the long side or the short side centered on what the stock (price action and size) tell me, what I see the market-makers doing on the Level II screen, and provided the stock is trading in line with the data of the Nasdaq 100.
I always have a reasonably small protective remain in place to guard me in-case I am wrong and took the business too quickly. I may possibly try that trade 2 or 3 times before I have the right access, each and every time taking a little drop. However when I get the right entry, there is plenty of money to be made, particularly when you're in-the right stock.
One of many things I like to do would be to stay with exactly the same stock, as long as it meets my stock trading needs. I may deal exactly the same stock all week as along as it is doing for me and I am making great worthwhile positions with it. Among the benefits in doing this is that you actually become familiar with the inventory well, and how it trades.
To repeat, I think the best stocks for stock trading are those stocks with very high rate and high volatility, high volume and a great intra-day travelling variety. When you have these features, you know the large institutions and the 'accelerators' take part in the stock.
For stock trading, you'll need a direct access morning trading account from the stock trading agent that gives direct access stock trading software. That is an absolute must have for day trading. The program can have Level II, maps, technical indications, etc. Direct access means that your buy and sell orders are sent straight to industry by you without using a man to position the orders for you..
The first thing you need to do before you even try stock trading, and this can be even if you do have some knowledge, would be to get an excellent day trading class to ensure that you really understand how the business of stock trading works, what patterns to consider, how the markets work and how everything fits together. It will be the best investment you ever make. If you do not eductae yourself - you have better-than a 90-mile possibility of failing.
* the language share trading and day trading are compatible.
Good luck and good trading,
The Maverick
Larry Schade.