The Basics of Successful Stock Trading

5 Step Process to Find and Enter Stocks Successfully

If you are a new or beginning Retail Trader, there are many exciting new ways to find stocks quickly and easily. The goal needs to be to learn how to use your TC2000 charting software to maximize time and efforts, while generating the best list of stocks for potential trades for Swing Trading, Position Trading, or Day Trading. These are the most popular trading styles, and all begin by studying the stock chart.

Here is the list of how to find and enter stocks successfully in a 5 Step Process:

1. Use Stock Scans to find stocks to trade that fit YOUR criteria rather than using recommended stocks, or guru stock lists. Most of the time, recommended stocks get you very late into the trend. You want to find stocks that have high profit potential, rather than stocks the giant Buy Side Institutions are selling because the stock was recommended by a guru.

2. Use Candlestick Charts to analyze how far the stock will move based on your trading style entry, exit point gain potential, and risk tolerance.

3. Use Leading Hybrid Indicators that tell you that the giant Buy Side Institutions using Dark Pools have been buying the stock, even while the stock price has not moved up. High Frequency Traders chase the Dark Pool buying by the giant Buy Side Institutions. If you want to get in on big gains, you need to be in before the High Frequency Traders run up the stock price.

4. Determine the Risk of the trade, and whether it is within your risk tolerance. Oftentimes traders take losses because they are buying into a higher risk trade. It is NOT just whether the stock is going to run, BUT also how much risk you are taking. Stop losses are based on support and resistance, and not on percentages.

5. Determine how to Enter the Stock and when to Exit the Stock for the highest profit for that trade.

By understanding when to exit you can sell the stock at the right time, rather than seeing your profits disappear as the stock encounters profit taking.

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Trade Wisely,

Martha Stokes CMT

TechniTrader technical analysis using a FreeStockCharts chart, courtesy of Worden Bros. and FreeStockCharts.com

Chartered Market Technician
Instructor & Developer of TechniTrader Stock & Option Courses

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