Day Trading For Beginners

Submitted by Stock Market News on 6 May, 2011 - 17:30

Day trading strategies for beginners

Share trading is one of the most common ventures for beginners. However making money out of the stock market can be very difficult. Its a place where opportunities are grabbed and losers are taken advantage of. For any newbie, even for the pros, the stock market is a cut throat world. Fortunately there are day trading strategies that beginners can use.

Scalping – the main goal is for traders to buy a number of shares (anywhere from ten to a hundred) at the asking price and then sell them immediately for a few cents, either higher or lower. Traders who use this strategy believe that small gains are easier to bank than larger ones.

Fading - is an investment strategy that goes against the prevailing trend. The trader will sell when a price is up and then buy when its down. An example of this is when a trader buys when the price dips and sells when it rallies. Its highly volatile but provides potential for short term profit.

Daily Pivots – this strategy involves buying at LOD (low of the day) and selling at HOD (high of the day. Traders who use this method profit from the stock's volatility. The price target is based on a trend reversal.

Momentum - this trading strategy is based on news releases and strong trends based on volume. A trader will buy stocks based on news releases and ride the trend until a reversal. The price target is when the volume begins to decrease.

Choosing which strategy to go for will depend on your trading plan and risk profile. But no matter which you choose, it doesn't really matter as long as its profitable. Knowing what, who and why you are profitable are the key to making money.

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