Part II - Tips on Making Money Trading Like a Pro

This video shows a simple entry and exit method for swing traders. This strategy can be used in day trading. 5 minute candle will be used instead of daily candles.

Continuing from Part I...

Introduction
The greatest thing about virtual trading is that you cannot loose any money. It is a good place to develop and practice your trading skills and master your craft. To do so tips are very useful. Compare the "10 Golden Trading Rules" in the video in Part I with the tips shared in this blog and make your choice based on your style or method of trading.

Tips 6 - 10

Tip 6. Select or develop an entry and exit strategy which must include stop loss. The chart formations in the previous link can be used in any type of trading. Take your profits, you may reenter a trade if need be. You can't go broke taking profits. But, greedy pigs get fat first and are then slaughtered. There are many trading systems, but you have to choose one you are comfortable with according to your risk tolerance. To succeed in a system you must follow it 100%, and be consistent. Document and learn from your mistakes. You do not have to win a virtual competition to be a successful trader, but use it to help you get better at trading.

Tip 7. You need time to trade. The best time are from 9:35 am to 10:35+ am; and from 2:45 pm to 3:45+ pm. The “+” sign means you are in a trade that is working for you. A few stocks at 9:00 am and after 3:45 pm may explode or gap up or gap down. Sometimes, during the middle period of the day a few stocks may also drop like a rock or go up like a rocket. If you can catch any of these at the right time you will make huge profits in a very, very short time.

Tip 8. Every expert trader needs a reliable scanner or some other method to prepare a list of stocks to trade. A good scanner will inform you about stocks that fit your trading criteria. To get a quick list of stocks to trade, visit the profile of the leading traders in this month official competition at howthemarketworks.com. Create a watch list with these stock symbols and monitor them daily.

Tip 9. Another day trader suggestion is to be focused like a laser beam. Trade only one stock at a time. Buy long or sell short the maximum amount of shares as per your capital balance (in reality trade the maximum according to your brokerage commission/volume agreement). Once you understands the movement of a particular stock you may be able to buy long and sell short this stock at the appropriate time. You will be able to make profitable trades better than 70% of the time if you are aggressive and almost 90% if you are conservative.

Tip 10. Some traders say you need to know the the market sentiment, but I say you need to know the psychology of the trade and what the indicators represent. Obviously, as a new trader if you select a stock to buy long and the market is going up at that time you will have a good chance of making a profitable trade; and vice versa if you sell short. However, as a you get good at this, you will be able to buy long even on a day when the market is down. For example, in my $5,000 virtual portfolio, New 1 Percenters-Jan I only did a few short trades on the 31st of the month and I won that contest with huge gains. In that month I made at least one trade every day.

Finally, if you are a new trader and you move from being a long term or swing trader to a day trader and you implement the above tips you will have a good chance to increase your profits. Also, even if you are an experienced trader, you can use the above to help fine tune your trading and be more efficient in your trading, and be good enough to compete with Mr. Burns in the virtual competition. If you have any difficulties with any of the trading terms used; feel free to research the terms at www.investopedia.com or in Google type for example - “define: scalper” without the quotation marks.

All the best in your trading!

Caution
According to the Federal Trade Commission, 'How-To' Products Promise Extravagant Profits, Few Risks, While North American Securities Administrators Association Says 70% of Day Traders Lose Money. Please visit the FTC at the link above. The information provided on this site is for educational purposes only and does not give trading, investment, tax, or legal advice. The information presented here is not specific to any individual's personal circumstances. Because of the nature of financial leverage and the rapid returns that are possible, day trading can be either extremely profitable or extremely unprofitable, and high-risk profile traders can generate either huge percentage returns or huge percentage losses. Anyone who chooses to use the information here in real trading does so at their own risk and will be responsible for their gains as well as their losses.