Sunday, April 23, 2006
Three Steps for consistently making money trading stocks
Step One) Determine which way the market will move and trade stocks in that same direction.
This will reduce your risk and give you a higher percentage of winning trades and reduce the loss on your losing trades. Most stocks follow the market. On up days most stocks have far less selling and more buying which causes them to go up. The reverse goes on down days. Our software has many tools for helping you gauge market direction.
Rules of Thumb
Rule 1) If above the pivot go long, if below go short. (Pivot point is horizontal white line).
Rule 2) If above the balance point line go long, if below go short. (Balance Point Line is yellow line and where market's average position is).
Example:
In the example below you can see the S&P 500 futures. This is one of the best overall market indexes and most stocks tend to follow its direction. In this example we have a few of our predictive tools - Balance Point Sectors, Pivot Points, Statistical Range, Squat Bar and Trend Reversal indicators.
First look at the pivot points, the white line is the average price of the previous day and the rule of thumb is to buy if the market is above and look for shorts below. The next step is to look at our Balance Point Line which is the average price that traders hold positions. This is one of the most useful tools and is a fantastic support/resistance level. If above the yellow line you should be long and below the yellow line short. If above the pivot point and balance point line your odds of success buying are dramatically increased. During times where the market is under the balance point and above the pivot use caution buying. Reverse for shorts.
Let's see how the above and our other tools worked in the chart below. The market was above the pivot all day and on three occasions pulled back to it and reversed. There were low risk stock buying opportunities at 9:45 am, 10:45 am, and 1:15 pm EST when the market pulled back and found support at the Pivot. This happens usually at least once each day and is a source of the lowest risk trades. Buy stocks when the market finds support at the pivot. If the market is below the pivot and rallys up to the pivot short stocks when the market finds resistance there. Using these TRADING ZONES can dramatically improve your trading results and end the confusion about which direction to trade.
http://www.topgunsoftware.com/stocktrading.html
This will reduce your risk and give you a higher percentage of winning trades and reduce the loss on your losing trades. Most stocks follow the market. On up days most stocks have far less selling and more buying which causes them to go up. The reverse goes on down days. Our software has many tools for helping you gauge market direction.
Rules of Thumb
Rule 1) If above the pivot go long, if below go short. (Pivot point is horizontal white line).
Rule 2) If above the balance point line go long, if below go short. (Balance Point Line is yellow line and where market's average position is).
Example:
In the example below you can see the S&P 500 futures. This is one of the best overall market indexes and most stocks tend to follow its direction. In this example we have a few of our predictive tools - Balance Point Sectors, Pivot Points, Statistical Range, Squat Bar and Trend Reversal indicators.
First look at the pivot points, the white line is the average price of the previous day and the rule of thumb is to buy if the market is above and look for shorts below. The next step is to look at our Balance Point Line which is the average price that traders hold positions. This is one of the most useful tools and is a fantastic support/resistance level. If above the yellow line you should be long and below the yellow line short. If above the pivot point and balance point line your odds of success buying are dramatically increased. During times where the market is under the balance point and above the pivot use caution buying. Reverse for shorts.
Let's see how the above and our other tools worked in the chart below. The market was above the pivot all day and on three occasions pulled back to it and reversed. There were low risk stock buying opportunities at 9:45 am, 10:45 am, and 1:15 pm EST when the market pulled back and found support at the Pivot. This happens usually at least once each day and is a source of the lowest risk trades. Buy stocks when the market finds support at the pivot. If the market is below the pivot and rallys up to the pivot short stocks when the market finds resistance there. Using these TRADING ZONES can dramatically improve your trading results and end the confusion about which direction to trade.
http://www.topgunsoftware.com/stocktrading.html
# posted by Cherie : 2:44 PM
