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3 Tips To Successful Day Trading

Day trading isn’t rocket science but there are certain principles that should be followed in order to bring about success. The following three principles, if implemented can help the day trading professional successfully navigate a complicated career choice:

End your losses promptly: Take control of every condition confidently. If you note that losses are mounting, sell your stock immediately and leave the market.

Go with the marketplace: Deal in stocks that are in high demand instead of stocks that have little interest for buyers. Learn the market trend and flow with it.

Master your emotions: Act rationally and eschew rumors and do not act without thinking. When a loss does occur, examine what happened and apply what you have learned to your next trade.

When all three principles are put into place, then day trading success is sure to follow. Read on for an example of one such successful reaction to the market by a day trading professional we shall call Dave:

At 9:10 in the morning Dave pulled up information about a company he had been tracking for several months. Ganco Technologies was in the business of developing cutting edge medical products including a scanner that would be cheaper than an MRI. News of the pending product announcement had pushed stock up by 3 points in one week but an announcement of the new product was believed to be days away.

A couple of clicks of the mouse found David on a medical tech forum where the conversation centered around some buzz generated by the pending announcement of the new Ganco scanner. Dave determined that the buzz was genuine and decided to purchase 1000 shares at $82 a piece. Indeed, four hours later the announcement of the new scanner drove prices past $88 whereby Dave immediately sold what he had purchased earlier that day.

Dave did everything right with this transaction and had a nice profit of $6000 to show for it. True, the stock eventually closed up an additional 75 cents, but Dave new that it would eventually drop back either later that day or by the following week. Dave knew the market instinctively and acted accordingly. He did not let his emotions nor the fear of a possible drop in price influence him. Instead, Dave acted rationally and had a day trading profit to admire.

Day trading principles such as those outlined are essential toward bringing about success. Follow them in your day trading profession and you are certain to reap many profits.