Sam; Re >> 8. Which brings me to the most important rule: be PATIENT.<<
Nice trick with taht putting the most important rule last will likely
cause it to be remembered first.
--------------
To All, I can see Sam is as seasoned as I am so this is
for less seasoned traders.
If your rather new to short term or daytrading think about learning
to trade something that won't eat your lunch, true it won't make you rich either but it's good to go slow at first.
I suggest the DIA, SPY, MDY, or QQQ.
After you are successful with one or all of them for a extended
period of trades..then consider the hotter stuff.
Learning the tricks and traps can be costly, "real" Trading seldom
will be as good as you can do on paper..
At least with the above you have diversity toning down the
volatility , and they are fairly well pegged to the respective
indexes, this lets you get use to
Rule
# 2. Get a sense of the general market's movement for the day. Watch the bond yield and the foreign markets and get a good read on the "perception" of the market in general. As well as the perception towards your stocks and their sector.
Often stocks follow a daily pattern in a particular market environment (i.e. gap and trap,
etc...). Don't fight the pattern. No one wants to sit on a losing position all day long.
-----------------------------
With most individual stocks having a feel for the over all market is
an important aspect of trading, as the general tide tends to float
all boats so by trading on the indexes for a bit you develop
that skill. Mistakes here can often be forgiving in nature
or at least not as painful as getting trapped in a 10 or 20 pt
Gap. If you can't trade the indexes as a winner,
then don't trade individual stocks.
-----------------------------
My last rule, Never short & Never Never play options not
even on the indexes until you are a seasoned winner at
basic trades.
Getting to cocky too fast will teach you the hard way
about the wisdom in the above.
Don't forget Sams Rule #8
Jim
PS
I am fairly seasoned and since the onset of the QQQ, taht
has become and remains my most favorite trade.
|
