Day Trading Program Optimizes Your Trading, Removes Emotional Decisions

Many day traders approach Emini and Forex trading with the thought that most traders are going to lose. Successful day trading programs are built on the basis that in order to "win," you must perform differently than those who "lose." A successful approach to day trading is directly related to the individual's willingness to learn and study trends, ability to balance workloads and perform in a time-sensitive environment, and maintain realistic expectations. In day trading there are few guarantees, and those who guarantee your success are likely setting you up for their own benefit.

Although investments always contain risks, there are proven methodologies and programs that significanly cut these risks by eliminating human error. Quite often, you will make a decision based on emotions, whether you know it is the right choice or not. However, "hope" is never a safe bet no matter how strong your emotions are.

Trading Grail, a streamlined and intuitive day trading program, will help you manage your investments, identify Eminis and Forex trends, and guide you through investments using hard data and trend analyses. By eliminating the human factor, your comprehensive investment strategy will be optimized, and your risks greatly reduced. In fact, Trading Grail will show you exactly when to enter long and short-term positions on Eminis and Forex markets.Trading Grail is a proprietary set of indicators that tell you when conditions are prime for a move in either direction.

The problem with most

Day Trading Strategies

Day trading is an important element of online trading. Unlike people who invest in shares to increase their asset value and earn dividends, day traders attempt to earn profits every day. Day trading involves purchase and sales of shares several times by day traders in a day. The rule is to exploit different factors of the stock market for profit and exit the market before the day's closing.

Day traders employ different strategies. In fact, several online day traders have their own strategies. These strategies are classified into different groups. We will discuss some winning strategies in the following paragraphs.

If you are willing to get into day trade, you should find highly volatile stock. The more volatile a stock is, the more the movements it has: sale and purchase. If a particular is traded more, it offers better chance of making profits as its value fluctuates rapidly.

You should be able to identify when to enter the online day trading market and when to exit. In other words, you need to know the stock position at any given point of time during the trade. This knowledge can be obtained from the stock exchange upon payment of a nominal fee. Together with a software which accepts the real time feed, you will be able to identify when to purchase shares. You can keep a watch on stock fluctuation and exit as soon as its value reaches a preset value.

Talking about preset values, you should also plan for the percentage of profit and loss which you can handle. Ideally, you set profit level three times higher than the amount you can risk. Entry can be better defined if you set more than one condition. You enter the market only if all the conditions are met. Similarly, you need to identify the point at which you should exit. You can also set a target for the day and then exist the market for the rest of the day if you reach the target. Preparing entry and exit points in online trading helps you minimize loss. Some day traders continue trading even if the profit target is met. This tendency is better avoided. The practice of exiting the market as soon as the profit is met helps you maintain discipline.

It is recommended to create a stop loss point. This point should be defined prior to entering the trade and should not be dynamic. This strategy helps you reduce the amount you lose. People involved in online day trading can use real time software to prevent trading during loss. The exit point is fed into the system. As soon as the value falls to the stop-loss point, the software triggers a market order to exit the trading.

Also, day traders take care of their trading capital. This capital should be protected at all costs during online trading. It is the lifeline of your day trading. In short, traders should plan their entry and exit points, stop loss points, and percentage of profit and loss to be incurred for better day trading.

Online Paper Trading - Learning the Ropes of Online Paper Trading

Online paper trading involves the use of 'paper' or virtual money in your trading account. It is almost identical to live trading, except that your profits (and losses) do not involve any real money at all.

Why Paper Trade?

But why would people wish to trade using 'fake' money? After all, isn't the point of trading to make real money? At first glance, paper trading may seem to be pointless, but I'll soon explain why paper trading is an essential aspect of every successful trader's overall trading methodology.

The Point of Paper Trading

Paper trading allows beginner traders to practice entering and exiting into trades, which includes learning how to place stop loss orders as well as orders to take their profits. Without the ability to paper trade, new traders would be paying real cash for all the mistakes that they make when they first start out.

For example, a beginner trader may mistakenly click on the 'Sell' button instead of the 'Buy' button, causing him to lose hundreds of dollars in only a matter of minutes. With paper trading however, the beginner trader is able to learn from his mistakes without paying any real cash to learn from it. Paper trading is thus a great way for new traders to familiarize themselves with trading in the currency market. Once they have learnt the basics and can be consistently profitable in their paper trading, they can next move on to live trading to reap in real profits.

Paper Trading is not just for Beginners

It should also be known that experienced traders still practice some form of paper trading, even though they are already making a good living in trading with real money. They do this to test out the profitability of new trading strategies and are constantly working to improve and refine them, without having to pay any money to do so.

Stock Market Crash - How to Massively Profit While Everyone Else Panics!

Have you ever heard of a Stock Market Crash?

Do you know that is a whole bunch of baloney?

When you hear that phrase it makes you think that all the money in the Stock Market has just fallen into a big black hole doesn't it?

But it can't just disappear, so where do you think it went?

It went out of the hands of those who didn't know what they were doing and into the hands of those who knew EXACTLY what they were doing!

Stock Options are a very powerful vehicle for making money in the stock market with a smaller amount of money than if you were to buy the actual stocks themselves.

And it's very hard to profit from a falling share price when you own the stock.

But if you owned a PUT OPTION over a falling stock it would GO UP IN VALUE as the stock price dropped!

Put Options give you the right to sell shares and as a stock price falls the put option will increase in value. This means you can use put options as insurance over shares you own to protect you from the brutality of a market crash.

However, Options Trading using Puts can rake in the profits for you in a very short period of time when the market is falling, allowing you to make money as income!

Let me explain...

What if the media had been spouting doom and gloom about a possible financial crisis and the banking sector was most certainly going to get hit hard as a result?

The Smart Options Trader would look at a big banking stock on their company stock chart and he might see unrest in the buyers and sellers. His analysis may tell him that the share price was likely to fall.

Let's say the price is trading at $ 55 and he buys an In The Money Put Option with one month till expiry. The option strike price is $ 56 and for this he pays $ 3 in premium.

The maximum he stands to lose is his $ 3 should the stock price rise above $ 56.

The following day the share price drops to $ 52 and the Put Option is now worth $ 6. The Smart Trader could sell his Put Option on the market today and realise a profit of $ 3 or he could hold the option a little longer for more profit if his analysis told him the price was likely to fall farther.

When you look back in history at the stock market, you will see that prices tend to go up slowly, but when they fall, they fall fast. In a stock market crash the prices fall suddenly, and with this comes an increase in volatility, resulting in high Put Option values.

As I said, the money falls into the hands of those who know exactly what they are doing, and Put options are the perfect vehicle for doing just that.

Common Pitfalls of Neophytes in Day Trading

Neophytes in day trading have common denominators that should be avoided. These denominators define them as traders initially but as they mature in the trade, they learn to strip themselves of these common personalities that are oftentimes unhelpful.

The Slacker, By definition, a slacker is a relaxed person, he does not take the business personally. He is contented in being a mediocre. He does not bother studying beforehand what the indicators are; he does not do his homework. He does not go over the past trading sessions to asses the changes that happened, the indicators that could have been helpful for his next trade, the chances on trading that he has missed. In short, he does not understand the behavior of the market and he does not mind. He is different from many other traders who dedicate all their waking hours to trading without counting the costs. A slacker does not have passion for this kind of work.

The Over traders, Scalping often appeals to novices because of the minimal risks on each trade and the opportunity that these give to practice trading muscles since each trade has a different behavior. However, scalping also lures traders to overtrading which has its inherent dangers like random choices of trades (remember that it helps to have a great deal of knowledge on one trade since it gives you a higher probability of profiting) and choosing too many trades that are too much to handle.

The Gold Rushers, These type of people believe that day trading could make them millionaires overnight. They believe in unrealistic promises that most promoters use to encourage people to participate in the trade.

The News Dependents, Most people think that the headlines provide all the information they need. What they do not realize is those commercial news channels have only one thing in mind- to make money out of delivering news to the people. They make trading news so trivial that many people react to them easily, sometimes with too much excitement. What these viewers do not realize is that by the time the news gets to them, the traders have already closed their positions and the climax of the trade is over. News channels and papers are fun to watch but they do not provide a great deal of information necessary for directing the trades.

The Trade Chasers, These are traders who lose trades and make up for them by panicking and chasing trades.

The All-Around Players, These are the people who adhere to the belief that knowing a little on each type of indicator is enough to make money on the trade. They are, basically the jacks of all trades, masters of none.

Stock Options Trading - How to Profit From Falling Stock Prices

When it comes to making money on the Stock Market you will find everyone has their own view on the best strategy to use.

One of the most common strategies to make money in the short term is to buy shares and sell them at a profit once the share price has risen.

This is called Stock Trading, and can be a very effective way to profit from shares.

However just lately we have been looking at a downward and quite volatile move in our markets.

Right now many traders are sitting back 'waiting for the market to get back to normal' before they begin to profit again, but who knows how long bear markets last?

And what are these traders going to do for CASH in the meantime?

I believe in trading a strategy that suits the direction of the market, not waiting for the market to eventually comply with the criteria of just one particular strategy.

While everyone else has been running the other way in the present market conditions, there are quite a few traders who have been making consistent profits.



How are they making money on falling stock prices?



Well there are several ways to achieve this, some more complicated and costly than others. The most affordable, easy to understand and easy to implement trading vehicle I have found that will help you make money on a falling stock is Put Options.

Put Options began many years ago as a hedging instrument. That is they were designed as an insurance instrument for shares.

Basically a Put Option is a contact that relates to a particular stock and gives you the right to sell that stock at a fixed price within a certain period of time. For this right we pay a premium.

So an example of hedging would be if you owned some shares that you paid $ 20 for and bought a put option for insurance. This would give you the right to sell your shares at any time (during the life of the option) for $ 20, even if the share price fell to just a few dollars.

So how do we Make Money as Income using Put Options?



The most common way is to trade the actual Put Option and NEVER buy or sell the stock. This is called Options Trading.

As the share price drops in value, the value of the Put Option actually INCREASES. So when Options Trading we want to buy puts on falling shares and sell them to another trader at a PROFIT.

Let's imagine that ABC shares are trading at $ 40 and our analysis tells us that the price may fall even lower.

We could buy an ABC $ 40 Put Option and for this we might pay $ 2.

We now have the right to sell those shares at any time before expiry of the option for $ 40. But we don't own the shares, nor are we interested in owning the shares.

Soon after we buy the option, the share price falls to $ 30. So if we wanted to, we could buy the shares now at the market price of $ 30 and sell them with our put option for $ 40 resulting in a $ 10 profit.

That sounds appealing?



To do this however, we would have to come up with the $ 30 each share to be able to buy them before we could get that $ 10 profit in our hot little hands. What if we don't have that kind of money to spare?

Here's the power!



Because the share price has fallen, our Put Option could now be worth $ 12. And because we only paid $ 2 for it initially, we are now looking at a $ 10 profit.

We would then sell the put option on the market for $ 12 and realize our $ 10 profit, and all we had to come up with to do this was the initial $ 2 we paid for the option contract.

This is called leverage and it is a very powerful way to make money from a smaller amount of money.

And the maximum amount we stand to lose if we get it wrong? Just the $ 2 we paid for our option in the first place.

Negative Aspects of Emotional Day Trading

It is oftentimes difficult to become rational when your emotions are on the line. If you are the type of day trader who shouts at your screen urging the market to move for you or shout out with joy when you begin to see your earnings, then it is time to asses yourself.

Emotions are out of the game when talking about this trade. You cannot be emotional when you are trading. Emotions are the downfall of most novice day traders. Why? Because it makes trading a lot more difficult to profit, to take risks and a lot more difficult to assess. Emotions would naturally cloud your judgment. It could push you to make decisions that you would otherwise not make if you are calm and rational. It will make you panic.

But there is more to trading than yelling at computer screens and irrational behaviors. Here are some of the main emotions that you should be on guard when you're in the business:

Fear

Fear is said to be an effective survival mechanism but only in its right quantity. Everything that goes beyond what is helpful will alter your behavior. It will put a stop to your decisions. It could paralyze you. As a trader, you should learn to asses your fears- do they help you or do they cripple your decisions?

The main fear that all traders have is that they will lose their accounts due to losing trades. This is rational fear and is highly possible. But one has to understand that he must sometimes make fearless decisions. To be able to minimize fear in the trade, you have to acknowledge that no one in the trade came in and went out without losing, and sometimes depleting, their accounts.

Greed

Most people, when they enter the trade, only have one thing in mind- walking out with some great amount in their hands. That's ok but when it starts to give you unrealistic expectations then it is time to stop for awhile and think- what is your idea of "earning"?

Greed is the direct opposite of fear. It makes someone take the decisions that he would not normally take or do the things that he would naturally be reluctant to do. Greed could make someone stick to a single position far longer than necessary or to randomly select trades which appear to be lucrative. But again, when used in the right quantities, greed could be a motivational factor.

Getting to Know the Fundamentals of Day Trading

What is day trading all about? Why is it one of the most common topics in the business world?

Day Trading Defined

Simply put, day trading is similar with that of the basic trading done on the stock market itself. The process involves the typical procedure of buying and then selling of options, stocks, futures, and currencies in the financial market. Its main goal is to generate profit as realized from the difference that lies between its selling and then buying prices. What makes day trading a standout from the rest of the common trading systems on the market is that the trade takes place in a span of twenty four hours amidst the opening and the closing of the bazaar. Anyhow, transactions are peculiarly carried on overnight.

A Bit of Historical Background

Originally, day trading was mainly accessible by the then limited financial firms like the banks. These financial companies were the sole institutions which had the access to the market data particularly to the exchanges wherein the stocks were mostly traded by interested firms. Yet, with the onset of several technological breakthroughs, the entire picture has dramatically changed. For now, even the individual traders can partake in the same trading field.

The Variety of Methods in Day Trading

There are two main varieties of trading and they are principally related to the trading style that a person opts to pursue. They are the short-term trading and the long-term trading methods.

Short-term trading involves the maintenance of the stock or options for a couple of seconds or minutes. Whereas with long-term trading, these assets are kept under the trader's custody for a more lengthy period that is usually for some hours up to a whole day.

The trading styles can likewise be categorized according to the proof of the direction which involves the actual price movement of the futures, the currencies, and the stocks. These styles are the counter-trend trades, the trend trades, and the ranging trades.

With the trend trades, the day traders purchase when the actual price of the stock swells and then sell it to some interested parties when the prices fall. Needless to say, trading is based on the movement or the direction of the prices.

On the other hand, with counter trades, the day traders go along with the sideways movement of the prices and they go back to and fro in line with the two available prices.

Moreover, a day trader may employ any of these styles or combine them all.

Day trading is complicated by nature. Getting a brush through of its fundamentals will significantly rescue you from the potential downfalls.

How to Identify the Indicators For Good Trading

If you have not learned your lesson in day trading yet, now is the right time to do so. The professional day traders are equipped with their very own strategies. Most traders look forward to positive results.

After all, who wants to end up on the losing end? For sure, it is not you. When you invest your money, it is your instinct that tells you that you certainly expect something in return. So, whether you will prefer the swing trading, basic trading, or online trading, it is significant that you have something to follow as your guide. The stock market can be uncertain and the role of your strategies will play its role here.

Since the Forex currency marketplace is basically liquid, you can adopt the same strategies from time to time. For you to become a successful day trader, you need to ensure that you have all of the needed discipline and dedication. Yes, there are many times that you will be threatened with losing in the trading system but it is important that you can handle such challenges. Do not worry because tomorrow is yet another day to trade. Your mindset must be to go towards what is positive.

If there is the absence of a certain plan of action on your part, then you will rarely succeed in your business venture. There are several good benefits attached to day trading but you can't take hold of these if you will not push your luck to its maximum and employ certain strategies to become successful in pursuing with the system.

Also, you need to take enough time to research on and familiarize the profile of the trading market that you plan to venture in. Each of the various markets has its own characteristics. As the trader, you must be keen in observing the indicators that will give you the clue as to whether the market is in a good shape or not. Other tips for a successful result in day trading are as follows:

Do not solely focus on the possibility of profit gains. Not all transactions in the stock market can be converted into profits.

Be patient and motivated. Your profits can't be made overnight. You need time to adjust too.

Be aware of the risks to face. Day trading is a risky thing to venture into. Hence, you should learn how to accept potential loses.

Being involved in day trading is a big step towards winning or losing.

If you don't want to end up with the latter, better yet gear up your skills in identifying the indicators.

High Probability Trading System

Lesson 1

Successfull Day Trader

Day Trading Definition

Day trading by definition means that you end each day flat, meaning you go home without any open positions at the end of the trading session.

If you are to succeed at the day trading business, you have to run it like one. At the end of the trading day you take no position home overnight. By adhering to this discipline you avoid the overnight risks.

Day trading is limited by time and the average range of the currency, but you will be in better position to control your risk and the size of your losses. This is the key part of the "traders equation".

The average size of a day trader's profit will be smaller than that of a short-term position trader because of time and range. Day traders will be stopped out much quicker than position traders due to daily market noise such as programs and announcements from brokerage firms and the companies themselves.

The most important thing you must manage as a day trader is the size of your loss. Secondly you must manage a winning trade to maximize the profit on each trade. Your motto will become "make a point - lose a quarter". And you want to do this as many times as you can.

"Day Traders Equation"

Max % of profitable trades + Max profit per trade - Small losses x Multiple trades = 's SUCCESSFUL DAY TRADER

Maximum % of Profitable Trades

Day traders in an effort to keep losses small will get stopped out often and this makes it hard to maintain a high percentage of profitable trades. Our trading plan is to select the most promising opportunities; that is the currency which is most likely to move in the direction of the trend with maximum range.

In order to accomplish this you will select from the strongest currencies that have pulled back from their swing point highs or are coming out of consolidation in the direction of the trend (sells reversed).

Maximum Profit Per Trade

The currencies we look for must have room to run which means an average daily range of two points or more. When you enter the trade a good portion of the range should be available for profit.

Most traders have a tendency to take profits prematurely as they get nervous when a currency makes its normal pull back. You haven't traded if you haven't experienced taking a quick point profit and then watched the stock run another 1-1/2 points. You probably sat there frozen, unable to pull the trigger again as the stock made new highs. Managing your trade to higher profit levels after normal pullbacks is harder than it seems.

Small Losses

This is the part of the equation where you have the most control. If you can manage your losses, the profits will have a higher likelihood of happening even with average currency selection. It takes discipline and the proper mental attitude to determine your stop levels and execute the stop as planned.

The next most important thing to keeping your losses small is you don't have to wait until your stop loss point is hit before you exit a trade. When you enter a trade the market must prove to you the trade is correct by turning profitable within a short period of time. If the currency or the market dynamics change after your entry and appear negative, just get out of your position. Don't wait for the market to collect your $300 by taking out your stop.

Lesson 2

Choosing A Time Frame

Become Obsessed with One Area of Focus.

Discipline yourself to focus.

If you are going to be a forex trader for a living, then it makes sense - with respect to your currency trading, to focus on a currency pair, a system for trading that pair, and a time frame for watching that pair. If you focus on one currency pair to start, you can become as much of an expert as possible in that one area.

Becoming obsessed with one area of focus means that you set aside time every day to test 50 historical trades. And that you only watch one currency pair to start. And that you only watch one time frame. And you become an expert in that system, on that one currency pair, in that one time frame. If you look at 1,000 trades with those parameters, you are going to become an expert.

If you become an expert, you are going to trade profitably.

Different Trends on Different Time Frames

The EUR/USD can be trending upwards on the daily chart, but on the 5 minute, it can be trending downward.

Think about it for a moment - if you have a long term, daily, dominant move upwards on the EUR/USD, it's possible that in the shorter term we could see a movement in the opposite direction. So remember, if you want to be a trend trader, you can choose to follow the trend on a variety of different time frames.

If you have a full time job, you might look at trends on the daily and weekly charts. These trends take much longer to start and finish - but they are worth a lot of pips - even more than 1,000 pips.

If you are able to trade during the day, you might look at the very short term charts. I have been testing a new trend following system that works even on the 1 minute charts.

The point is that each time frame can have its own trend.

Trend Trading Requires Courage & Money Smarts

If you want to become a trend-trader, you are going for the big moves. You are NOT going to be trying to get 10 pips on each trade.

You're going to want to get 50 to 500, and maybe even many more pips, when you are trend trading.

To do this you are going to have to commit yourself to a patient process of waiting for a trend to develop, and then to stay in your trades.

A Very High Probability Forex System

To be consistently profitable in trading any type of market, you absolutely must have two key ingredients: proper money management, and a high probability setup. In order to find out a high probability trade setup, you must carefully study the market you wish to trade in the time frames that you wish to trade it. This may involve such things as forward testing via paper trading or using small leverage, and/or backtesting; which can be done manually or automatically by coding the strategy in a trading platform that allows backtesting such as Tradestation or Meta Trader.

When you have found a highly probable trading strategy to trade by utilizing forward testing and backtesting, you must make sure that enough setups occur around the time that you are available to trade them in order to consistently extract profits from the market. If you don't find that enough setups occur when you're available to trade, try finding another strategy to trade.

The next step in trading is to follow a strict money management policy. For example: you may want to risk only 2% of your entire account size on a single trade. The higher the probability of the trade being profitable, the more you might want to consider risking on the setup. If a trade setup tests to have a probable outcome of only 60%, risk a very small portion of your account size per trade. On the other hand, if a setup tests to be 80% or higher profitable, you may want to consider risking up to 5% of your total account size.

If you work full time, and tend to be extremely busy, the good news is that there is a highly probable trading strategy that takes place in the Forex market usually once a week that tends to be around 94% profitable.

Online Trading Accounts - What Are the Benefits of Online Trading Accounts?

With the advancement of internet technology, more and more people around the world are gaining access to a high-speed internet connection via their computers. This makes online trading an increasingly popular activity among traders, and more people than ever are looking for online trading accounts to start trading with.

Benefit #1 Of Online Trading Accounts - Control

Perhaps the biggest benefit of gaining access to an online trading account is that you as a trader can be more in control of your trades. Most online trading accounts come with a free trading platform for you to look at the live market price charts. You can thus be able to execute your own trades via your computer (or trading terminal) without having to call your broker to do it for you. This is especially important if you are a scalper in the Forex market where your trades are entered into and exited in a manner of minutes. You wouldn't want to be calling your broker every 5 minutes when you wish to exit or enter into a trade, right?

Having an online trading account also enables you to have access to your specific account details, such as your available margin and your account balance. Since you can have instant access to these figures, you can constantly adopt your trade strategy according to the changing circumstances of your account. For example, if you notice that you are using up too much of your trading margin too quickly, you may want to tighten your trade criteria and only enter into trades with the highest winning probabilities while discarding those with a lower winning probability.

Benefit #2 Of Online Trading Accounts - Comfort And Convenience

With an online trading account, you can trade in the comfort of your own home without having to put up with all the noise and distractions in the trading pits. It will be easier for you to focus on your market analysis and trading decisions when you are in a comfortable and quiet environment.

Ten Trading Tips to Contemplate

Entry Strategy is important for making profits and minimizing risk. Knowing when you are going to buy a share will always give you an advantage because, if you buy under the right conditions, then you will have less to lose than if you buy at the very top of the market.

Exit Strategy means having a plan for either taking profits or minimizing losses. No exit strategy means more losses.

Taking Profits is about having a business plan that enables you to make a living from the share market. Businesses make profits for their owners to spend on their lifestyle. Share traders work for themselves and need to make profits to survive. Regularly taking profits on the share market is how traders make their money. Other people will leave their money in a share stock for years and, in some cases, they will see a reasonable return, but more often than not, the majority of people wished they had of sold their shares when they were at their previous highs.

Minimizing Losses is as essential to survival on the share market as taking profits is essential. Cutting losses quickly means that you are not financially and emotionally damaged from a huge loss. A series of large losses can blow your bank or even bankrupt you, whereas a few profitable trades quickly cover a series of small losses.

Key Indicators are the only tools that you need to use to trade successfully. Trading is easier than people realize. For the Technical Analyst, there is no need to be studying reports and having to have an ear glued to the news. Simply using about half a dozen basis indicators is sufficient to be successful as trader. In fact, the fewer the better.

Basic Patterns help you understand how simple the market is to read. There are excellent formations like a double bottom and an inverted head and shoulders, which are very reliable and other formations within a trending market, like triangles and pennants that confirm the trend.

General Trends give an idea of what is happening in the market. Some stocks will buck the trend, but most will not. What happens to these stocks forms the trend. Because of this is it profitable to trade the indices.

Small Caps are known as the lower end of town, and this is where some very good value trades can be made, because they have greater a chance for growth.

Large Caps can be safe investments, but often they are slow movers. Exceptions are when there is a mining boom and large mining companies are growing or some other industry is experiencing phenomenal growth. Meanwhile the other industries might be lagging for years and the companies fully capitalized or over capitalized. Unless you are using options, it is best to keep away from large caps, if you are looking to make serious money.

Trading Options provide excellent leverage on large caps. This is the way to make money on these stocks. Owning a share might cost you $40.00, but the option may be obtained for only $1.00. If the share moves up $4.00 and you sell the share, you will make very little because you will have to pay brokerage of the total value of the share and not the $400 profit on the 100 shares sold. On 100 options you would make 300% profit and only have to pay a small amount on each option purchased. The difference in outlay and profit is enormous.

Successful Trading Tips

Before the tips lets quickly look at some 'truths' about the forex trading.

Forex is not a 'get rich quick' business. This is one of the reasons 95% of traders lose their money.


It is different from gambling.


It can be learned and the best way to learn is by someone who is already trading and by books.


It is not an investment where money works for you; you need to trade personally.


Losses in forex trade are inevitable but they can be managed, minimized and still have a positive net figure at the end of the day.


There is no 100% accuracy in analysis because the market is dynamic.


Forex trading robots are not perfect.


Fundamental news move prices.

Now, let's see some of the useful tips that will enable us become successful traders:

1. Do not enter a trade without planning for the trade.


2. Do not stop learning and educating yourself about the trade.


3. Do not risk more than 3% of your total equity.


4. Do not trade without your stop loss and take profit orders in place. It is dangerous..


5. Learn how to use trailing stop in platforms that allow it.


6. Avoid greed and fear in all circumstances. Be patient and disciplined.


7. Learn and use momentum indicators at all times.


8. Keep your eyes fixed on major news release whether you trade with them or not.


9. Define your trading pattern. Are you a position or day trader? Do you trade with trend or range?


10. Always stay out of the market when you are in doubt.


11. Know when to exit your trade.


12. Do not open too many trades.


13. Always demo any new strategy before trading live.


14. Never rely solely on trading software; you are in control of your trade.


15. Consistently test a strategy for at least two weeks on different pairs before giving up on it.


16. Do not enter a trade based on intuition.


17. Do not increase your lot size after making a loss with the hope of recovery the loss immediately.


18. Try not trade very often.


19. Always run assessment of your trades over a specific period of time.


20. You need God in your trading career.

Forex Signals in Day Trading

In the last few years, trading with forex signals has become a popular game for the currency traders. Most of the forex signal systems used in this regard do not define the type of trading and the time frame used to trade. This a a poor strategy. First thing is to define your goals and set a specific time frame. I find it useful to follow one or two time frames. A daily time frame and a shorter 30 minute time frame to see what the forex signals are generating. If both a aligned, it is considered a good signal.

The 30 minute charts will however provide the forex signal earlier than the daily time frame. Again this will depend on your goals and also your account size. The smaller account holders are forced to trade shorter time frame which is also possible. The best thing is watch the market as a whole and see what the outcome of the forex signals have been in the last few days. Ask yourself a question by looking at the charts. If I had a long position in the markets according to the forex signals on the charts I am looking at, would I be a winner or should I be on the short size?

This question alone can give you immense insight into what is happening in the markets at the current time. Go with the flow, you will have a better trading life. Try this and compare it with the other forex signals you have been using.

The Joy Of Trading!

Lee Iacocca, best known for his revival of the Chrysler Corporation in the 1980s, once said, "In times of great stress or adversity, it's always best to keep busy, to plow your anger and your energy into something positive." As a trader, you know that there are good days and bad days in the market. Sometimes you wake up and you are excited to start the day, trading plan in hand, and ready for the challenges ahead. Other days, you may be in a bad mood, for whatever reason, and feel upset or frustrated. When this happens, Iacocca is right on - turn your energy into something positive.

That something positive can be an appreciation of the complex, exciting markets themselves. Some might even call them beautiful. Yet, to truly recognize the value of the markets, you need to step back, take a deep breath, and look at the markets from the "outside in." Being a trader is one of the most enthralling jobs in the world! Where else do you plan, anticipate, and find solutions to problems - all day, every day? What other role requires the search for a winning financial strategy, often without a lot of time to think! Mostly, trading is a creative role. It truly is an art. No two traders approach their job and the markets the same. Your intuition leads the way, and by remaining open and perceptive, you will not only appreciate the market, but will excel in your job. .It's like finding the beauty in the beast!

Whether you are a waiter, teacher, or trader - when you are having a bad day, you are stuck in a "doing" mode - trying to be active but frustrated that you just cannot seem to get anything done. You are stuck, and without a focus on moving from "doing" to "being," you will not be able to break out of your bad mood. Is it time to give up? Not at all! Rather than feel the weight of your world on your shoulders, take a deep breath. Don't force yourself to trade. Instead, spend the time learning about how you become a better trader. Research how successful traders have become that way. Study the markets. Once you have focused your energy elsewhere, you will see that your creative juices will start flowing again. Then - and only then - begin trading again. It's a good bet that you're "doing" mode will be back on track. You'll see trading in a whole new light!

In the mean time, Good Luck on your journey to success...

OR if you would like to immensely improve your trading and investing results, check out

Stock Market Research Tool

Quit wasting countless hours researching dozens of stocks to decide which ones to invest in. There are hundreds of thousands of stocks available through the stock exchange and thus it can be an overwhelming and time-consuming process to have to narrow down your choices to the ones that you believe will yield the greatest return on your investment.

Regardless of whether you are looking to invest for the long term or you are trying to make a living as a day trader, it is imperative that you have an effective system to quickly identify which stocks are likely to go up and which ones are likely to go down. A stock market research tool which provides accurate, real-time data, analyzes stocks' past performance, and issues forecasts of stocks' future performance, is something that you simply cannot do without.

It is highly recommended that you leverage the resources of stock market research computer software to facilitate your research, and to help you decide which stocks you should purchase. A truly robust stock market research tool (one that is capable of performing millions of calculations every second) ought to be able to analyze the past performance of hundreds of thousands of stocks and extrapolate the future growth or decline of each stock.

While neither computers nor human beings can predict the future, computers can process data exponentially faster than we can. Using their processing power, they can perform all of the financial computations against all of the data that is tracked for stocks on the market. They can even make "predictions" based on extrapolations of data from stocks' previous performance.

Get Out Of That Trading Rut!

Ever muttered these words? "I haven't made enough winning trades. "What am I going to do?" "I'll never be successful." Well, if you have, you're not alone. It's usually followed by "But I don't know to do differently." To quote writer Molly Ivins, "The first rule of holes: when you're in one, stop digging."

If you're a new trader, it's normal - and natural - to feel like you're in a hole. It can cause feelings of panic - and we've all been there. Of course, it's human nature to think about the past and worry about the future. But the more you resist this urge, the less distracted you'll be about achieving trading success. As you spend your time focusing on your future plans, analyzing current market conditions, honing your trading skills, and deciding how to approach your next trade, the more successful you will undoubtedly be.

But seasoned traders have a trick. They take their trades one at a time, and view each trade as a completely new opportunity. It's called "compartmentalizing your trades" and by focusing on your immediate experience, you'll increase your energy and remain optimistic about each trade you make.

To successfully compartmentalize, envision a different "mental compartment." Then, as you begin to initiate each trade, start fresh. Don't worry about how the last trade fared or how defeated you might feel if this one is made at a loss. Rather, focus every bit of your energy on the "here and now" - this immediate experience. Then, implement your trading plan with a calm and relaxed attitude.

If you've ever played sports, you know how important it is to be "in the zone." The game of golf is a great example. Golfers who excel don't think about the last hole or their current score. They focus on the present by analyzing the course and the traps ahead and determine what they need to do to accomplish the immediate goal. Then, they move to the next hole, approaching it with the same energy and renewed focus.

Now, let's be realistic. You do need to carefully manage risk and it's hard not to remember past failures. But what good does that do, really? If you must worry about the future, do it away from work and not while you need to have your focus at its optimum level.

The mental strategy of trading is different for each trader. There's no right or wrong. There's no best way and your success will depend upon your creativity and individual approach to each trade. But if you treat each trade as its own entity, you will be more successful than if you let each previous trade weigh on your current task.

Seasoned traders think positively, as if anything is possible. The next trade may be a winner or it may be a loser. Whatever the outcome, they celebrate their victory, take the loss in stride, and move on. And, in the end, they are profitable.

In the meantime, Good Luck on your journey to success...

If you would like to immensely improve your trading and investing results, check out

What Is A Market Maker?

A market maker is a stock brokerage firm, which is a member of FINRA (Financial Industry Regulatory Authority), formerly known as the NASD (National Association of Securities Dealers).

Market makers quote buy and sell prices for financial commodities, making a profit on the difference between the bid and the offer spread. The market maker gets compensated for providing liquidity in the market. A market maker is also involved with rule 15c211, in that a 15c211 is filed for a market maker to trade any given security.

When you buy or sell a stock or place an order with your broker, the transaction takes place within seconds. The process is quite simple for the buyer or seller, but the action takes place behind the scenes where the market makers line up the buyer with the seller and vice versa.

Without a market maker, it's very unlikely that you will be able to find a buyer or a seller for an exact number of shares at any given time. The market maker will buy a large number of shares from a seller, even when they don't have another buyer lined up. By doing this, they take on a huge risk. If the value of the stock falls while the stock is in their hands, they could lose a significant amount of money.

To prevent this from happening, market makers maintain a spread on every stock they buy. There may only be a $0.05 difference between the ask price (the price they buy it for) and the bid price (the price they offer to sell it for).

They sell to and buy from their clients in foreign markets, where most deal are done over-the-counter. By providing extra liquidity, this reduces the cost of transactions for clients and makes the trades worthwhile. If not for the market maker, they would have to accept a low price for the stock or not be able to trade it at all.

In the US, the AMEX and NYSE have a single exchange member, also known as a stock "specialist", who acts as the market maker for a given security. The specialist provides a required amount of liquidity to the market, prevents excess volatility, and takes the other side of trades when there are buy and sell imbalances in customer orders. Therefore the specialist is privy to trade execution advantages.

On the NASDAQ and other US exchanges, there are many competing market makers in any given security. They are obligated to buy and sell at prices matching their displayed bids and offers, and do not receive the advantages of a specialist.

Proponents of the official market maker system believe that market makers add to the liquidity of the stock and commodities markets by taking assuming risk and taking short or long positions, to hopefully turn a profit. On the London Stock Exchange, market makers can always buy and sell stock. Each stock always has at least two market makers that are obliged to deal.

Trading Goals - You Gotta Have Them!

Johann Wolfgang von Goethe once said, "Treat a man as he is and he will remain so. Treat a man the way he can be and ought to be, and he will become as he can be and should be." This from an 18th century leader who influenced music, drama, poetry and philosophy and whose focus on evolutionary ideas even inspired Charles Darwin...obviously Goethe was someone who set high expectations of himself and those around him!

As a trader, you should wake up every morning thinking like Goethe. Expect phenomenal results from yourself and you will receive them, but only if you have taken the time to lay out exactly what you expect of your trades, and are clear about what level of performance you will (and won't) accept. Setting clear and specific goals is perhaps the most important thing you can do to insure a high level of trading performance.

Everyone wants, and needs, to clearly understand how they will know if their work has been a success. Otherwise, what's the point? If you don't carefully layout your financial goals, what motivation do you have to put forth the day-to-day efforts that are required of your role?

You've no doubt heard that goals should be S.M.A.R.T.:


Specific


Measurable


Attainable


Realistic


Timely

When creating goals, type them up on your computer so you can easily update them. Do not put unrealistic deadlines on your goals and dreams. Some of your goals might be ongoing with no deadline; other simple type goals will have deadlines. For example, the goal of having a home on a lake might take some years to achieve, but can begin with the goal of becoming a successful day trader.

Then, create daily tasks to get you started on your overall objectives. A daily plan of attack helps you work your plan every single day. Focus and review each day to make sure you progressed.

But it's not that simple. The key to achieving your goals is taking your time and being careful to do all that is necessary to get to the end result.

Most importantly: Never give up! Where there is a will, there's a way!

In the mean time, Good Luck on your journey to success...

If you would like to immensely improve your trading and investing results, check out

Qstick - Technical Indicator

Overview - Qstick


The Qstick indicator was developed by Tushar Chande, in order to determine the strength or weakness of a security over 'x" period of time. The Qstick indicator represents the moving average of the difference between the opening and closing prices of a security. A positive value means the security has had more up days over "x" period, while a negative value means the security has had more down days over "x" period.

Trading Rules - Qstick


The Qstick like many other technical indicators provides a number of trading signals based on the values of the readings and divergences. Below are three basic rules for trading with the Qstick.

Crossovers


The Qstick oscillates above and below the 0 line. A very basic trading principle is to buy a security on a cross up over the 0 line and to sell the security on a cross down through the 0 line. This technique will work well in sideways markets as the security is more likely to adhere to support and resistance levels.

Extreme Levels


The Qstick also provides extreme readings that can often call market tops and bottoms. The Qstick value has no upper or lower limits, so traders will have to look at previous tops and bottoms in the indicator when going counter to impulsive moves.

Divergence


The last trading rule for the Qstick indicator is to look for divergences between the price of the security and the indicator. So, traders will want to purchase the security if the Qstick value is increasing and the price is moving down. Conversely, traders will want to sell when the Qstick value is falling and the price is rising.