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Top 50 Day Trading Do

http://www.stocksystempro.com/ Stock System Pro - Options and Stock Trading System - Learn how to trade like a pro in stocks and options with step-by-step videos guide. Over 24 hours of videos content! Make money trading even if the economy is in bad shape! Trading is no longer risky with this complete course. http://www.stocksystempro.com/ stock trading system http://www.stocksystempro.com/

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266 views13 pages

Top 50 Day Trading Do

http://www.stocksystempro.com/ Stock System Pro - Options and Stock Trading System - Learn how to trade like a pro in stocks and options with step-by-step videos guide. Over 24 hours of videos content! Make money trading even if the economy is in bad shape! Trading is no longer risky with this complete course. http://www.stocksystempro.com/ stock trading system http://www.stocksystempro.com/

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xbox360gurl70s
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Top 50 Day Trading Do’s and

Don’ts

Day Trading Do’s and Don’ts -


stock trading system

Day trading profitably over a series of


years is probably the most difficult
vocation anyone can attempt. The
odds of being a consistently profitable
day trader are enormously against the
average person. The main reason for
the difficulty in achieving consistent
profitability is the work and discipline
involved in the effort of day trading,
along with a dollop of luck along the
way. Even so, given all that, an outlier
event can ruin the day trader if he/she
is not on the job the moment the
outlier is made known to the market!
All good day traders are disciplined,
intelligent, and emotionally mature
individuals. They are excellent risk
managers. They manage time well
too. The following list has been
compiled over a period of 35 years
spent observing the stock and options
markets, as well as trading them. This
list is dynamic, as I add to it when the
addition has passed the test of time
and is known by me to be efficacious.

1)If immediately after a trade


execution the trade works
dramatically in your favor, you
actually waited too long to execute it.

2)You will know almost always in the


moment right after you initiate a trade
whether or not it will be profitable.

3)If you “know” something, odds


greatly favor that thousands of others
also “know” it.
Day Trading Do’s and Don’ts -
stock trading system

4)If at first you are a successful trader


with never having initial setbacks, the
odds greatly favor that you will suffer
more so than the normal trader who
has not been so fortunate. You could
even “blow out” your account if not
careful with your newfound success.

5)Breakouts take their sweet time


becoming cyclical.

6)Cyclical periods for stocks far


outlast breakout periods for them.

7) If it seems too good to be true, it


isn't.
8)Always position trade options “delta
neutral”.

9)100% invested is akin to the “I’m all


in” mentality, which eventually leads
to “I’m all out” of money. Thus, keep
some cash available at all times.

10)Call options inordinate volume of


at least an increase of a few hundred
percent of normal daily activity over a
few consecutive days is a signal of a
possible takeover in play.

11)Takeover activity in call options


involves far more

volume for out of the money calls


than in the money or at the money
calls. Leverage and greed are the
causes.
12)Large put activity can be bullish IF
you know that the put buyers are also
buying the underlying stock! Thus the
puts were merely a hedge to a long
stock position play. This combination
is a synthetic call (i.e., long stock and
long the stock's puts.).

13)Improvement in earnings in one


quarter leads to the same for the next
quarter. The odds of such are quite
high.

14)The market will always need touts.


Touts lead the sheep to slaughter.

15)If a popular tout tells you


something, that news is entrenched in
the market.

16)The more popular the tout or guru,


the less probability of their
recommended play turning out
profitable for you.

17)Professional traders have very


small egos. Touts and gurus do not.

18)Rumors have some fact in them,


the question being how much fact.

19)If rumors are driving a stock up or


down, and in spite of the rumor's
denial by those who should know if
those rumors are true or not, And the
stock continues to react to the
rumors, go in the direction of the
rumors!

20)Denial is the first step on the road


to panic.

21)Always trade hedged. Do not let


“one grenade” blow up your account
by shooting for the moon with that
play!

22)Getting caught being short a stock


rumored and acting like a takeover
will teach you a valuable lesson and
might wipe you out!

23)Do not give unsolicited advice to


any other trader.

24)Do not make known to other


traders your positions and biases
unless they sincerely need to know.

25) Abnormal pops or flops in a stock


without a reaction by their options to
that unusual, sudden move, suggest
those moves will be ephemeral.

26)Fade the ephemeral moves of #25


(buy that dip or short that pop!).
27)Do not sell calls to get short or sell
puts to get long. Buy calls to get long
and buy puts to get short.

28)A buy/write is 99.999% equivalent


to the sale of a shorted put, all things
being equal (strike and expiration
month the same.). For proof do the
math.

29)Periods of “rotation” tend to end


when seasonal add periods (new
money coming into the market) begin.

30)Things change.

31)Things stay the same.

32)Know the differences between #30


and #31.
33)Be proactive but control losses by
always having a “cut bait” dollar
amount for every trade.

34 Position trade in 3’s by dividing


your money going into the trade

by 3, entering each third of the


allotted funds as the stock fluctuates.

35)Never trade relatives’ money or a


friend's money.

36)Read stock market history books.


Not THAT much has changed!

37)When the dust settles, the


fundamentals rule the day. Charts
can only take you for a ride to that
“day's” end.
38)All bull runs end in euphoria and
bear runs end in despair—and not a
moment before!

39)There are no rich “cabdrivers”,


unless they inherit it. Fade “their”
advice, especially if it comes to you
unsolicited.

40)Even a mushroom cloud begins as


a puff of smoke. Be wary of quiet
selling.

41)In a stiff breeze even a turkey can


fly. Thus, do not short a stock just
because it is “flying”.

42)Odds greatly favor that a stock


that breaks down below 4 will trade at
2 before it trades at 6.
43)Odds greatly favor a stock that
trades up through 2 will eventually
trade at 4.

44)You have NOT seen it all! I once


watched in awe as a 2 dollar stock
blasted off to $28 in a month (in
1975), doing so while at the very
same time the company was filing for
bankruptcy! The cause for this
weirdness was that over 110% of the
floating stock somehow was sold
short! Once word got out about the
plight of the shorts, all hell broke
loose and buyers raised their offering
prices really high! A few weeks later,
after that all time short squeeze, the
stock went to zero.

45)Making money in the stock market


is akin to war. Trading is your tactical
movements while proper money
management is your overall strategy.
No war or battle ever went according
to plan. Always be prepared to adjust
to the unexpected as well as the
certain collateral damage.

46)Never stay in a trade where you


are “riding the tiger” (which implies
that should you get off that tiger, the
tiger will eat you!). Thus do not add
good money to a position which was
NOT planned to be used in the trade.

47)All stock market cycles end in high


emotion. To measure that emotion,
use the Standard and Poor’s short
term oscillator. A minus 4 or higher is
reading an oversold condition and a
positive 4 or higher is reading an
overbought condition. The stock
market always, eventually, reverts to
the mean, or fulcrum.
48)The stock market rises akin to
walking up a flight of stairs, and falls
akin to slipping on a banana peel on
those same stairs.

49)The stock market tends to move in


a series of 3's.

50)When the dust settles, the


fundamentals rule.

Learn more about this author, Skip


Raschke.

Day Trading Do’s and Don’ts -


stock trading system

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