Stock Trading Tips

Stock trading tips such as those detailed below are intended to improve your trading success by putting as many positive market factors in your favor as possible. Let's face it, it's a jungle out there-- even if you're trading top stock picks-- and you need to come prepared with your own highly-disciplined approach to trading stocks:

#1
Trade top quality stock picks made up of companies that have track records for sequential earnings increases, from quarter to quarter and year to year, like those regularly featured in Stock Confidential.

#2
Trade stocks that are being accumulated by institutional investors. Institutional investors such as mutual funds, banks, insurance companies, etc. drive the market--not you and I.

#3
Trade a manageable number of top stocks. Maybe only 4 or 5 top stock picks at a time.

#4
Unless you are a seasoned trader, select stocks which average at least 250,000 shares a day. Thinly traded stocks are much more volatile than more widely traded issues and can wreak emotional havoc on less experienced traders.

#5
Trade only during strong, confirmed market uptrends. Three quarters of all stocks, including top stock picks, tend to follow the fortunes of the overall market. The trend really is your friend!

#6
Trade during those periods when leading stocks are breaking out with regularity. Like so many "canaries in a coal mine," leading stocks tend to continually make new highs in strong markets, and are the first to struggle in weak markets. By the same token, high-quality, top stock picks are also among the first signals of a return to better market conditions when they form reversal patterns, then start to move back up again. Stock Confidential can help you spot these profitable buying opportunities.

#7
Trade stocks in sectors that are currently in favor. Sectors rotate in and out of favor, and the stocks within these sectors tend to move in tandem. Why try to second-guess when an out-of-favor sector will begin to attract renewed interest?

#8
Trade only stocks which have formed explosive chart patterns when they break through their buy points on strong, well above average volume. Stock Confidential's goal is to identify these buy points by finding what we believe to be the path of least resistance to potentially explosive upside moves.

#9
Pay close attention to news releases throughout the market day, and even after the trading day. These news releases, which include earnings reports, news bulletins, analyst upgrades or downgrades, insider trades etc. often have a powerful bearing on how your individual stocks will perform.

#10
Ignore opinion and "tips." There are a lot of self-appointed gurus on TV and elsewhere in the media, and they are often WRONG! Trust only in the facts and a top stock pick's price action as indicated by its chart.

#11
News rules! Pay close attention to scheduled economic reports. They are bellwethers as to the strength or weakness of the economy and the releases of these reports often have a dramatic affect on the market and ultimately, the stocks you trade.

#12
Pay close attention to the scheduled earnings release date for any stock you are holding and think long and hard before you decide to hold it through its earnings release. One alternative might be to sell a portion of your holdings to minimize the risk of an earnings disappointment.

#13
Decide in advance whether you're buying a stock for a long-term investment or a short-term trade and stick with that time frame. Don't execute a trade with the intention of pocketing a short-term windfall, and then suddenly decide to switch to a long-term buy & hold, or vice versa.

#14
Have an exit strategy in place before placing your trade, and stick to it.

#15
Use a real-time trading platform/charting service. This will enable you to gauge the strength of a stock or index's movements.

#16
Cut your losses and sell a stock if it drops 7 to 10% below your buy price.

Whether you're a seasoned trader, or just starting out, it's my hope that you will benefit from some of these trading tips. When you're ready to take your trading to the next level, here are some stock trading tips ebooks that might interest you.