The Big One

I'll admit that it is not every day that an intraday trader will find that large winner. However, if you follow the right steps to prepare for trading every day, you will be more likely to find these opportunities when they arrive.

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Volatility Stops

As a trading instructor, I sometimes catch myself muttering in my sleep, "Make sure you set your stop on that trade!" Ok, so I may not actually do that. But I am saying it constantly in the classes I teach. It is the main thing we as traders can do to help prevent catastrophic losses in our accounts.

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Making the Trade

New traders often become confused when deciding what tools to use in order to analyze the markets and select trading opportunities. Looking at the selections available as well as the tools offered in today's advanced trading software, it is easy for one to become overwhelmed.

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Market Moves

Stocks that participate in the same trend direction as the broad market will move further and faster in their trend. Those which are moving in a trend that is counter to the market will have difficulty moving large distances and therefore, usually offer less profit potential

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Adding Water to the Tea Leaves

Last week, I responded to the claim that technical analysis was akin to reading tea leaves and held no place in proper financial analysis. Anyone who has used technical analysis knows the value of it in order to identify the most probable direction and timing of market moves. In the same spirit, I do not want to downplay the usefulness of fundamental analysis either.

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Reading the Tea Leaves

I struck up a conversation with the person who was seated next to me. It turns out that he worked for Lloyds TSB Bank. His initial comment to me when I told him I was a trader and used technical analysis for trading decisions was, "Oh, so you read tea leaves!"

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