Wednesday, January 11, 2006

TRADING STRATEGIES


Day trading strategies-
Small cap intraday range strategies- Requirements: Stock trades between $1-10. Avg. daily volume 500k+. Intraday price deviation from open must be an avg. of 5%+. The strategy is to know support and resistance zones which keep the trading range intact. You must place your trade on the side of the current trend. You must watch for news during the day. You must study the last sale screen for the previous couple of days to understand how the major players are trading the stock. Look for block trades that are keeping the stock down or driving the stock up. Know how the primary indices are trading. Scan the message boards and get the primary opinion from clearstation, stockta, and stock consultant. Make an estimated price entry, price objective, and a protective stop loss. Calculate the amount of equity you wish to risk and what the commissions will be. Be patient and execute with confidence. Buy into the stock in pieces, not all at once. If your initial guess was right, and your trade is following the trend, buy some more. As you start to reach your price objective, start to sell some of your holdings, and then when you have decided there is a reversal, sell what you have left.

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