Trading stocks for beginners
If you are serious about making and keeping money by trading stocks, then there are three things you need to do, and do well.
1.When to buy stocks
2.When to sell stocks
3.Build your own stock trade system
When to buy stocks
Stock market signals may not be red or green or any color at all, but they are there and are obvious to one who wants to learn. The one who wants to learn is the investor who wants to protect his capital from loss and to make enough money to retire in a comfortable life style.
The most obvious signal is the 200-day moving average. You can find one of the best market signals printed every day in the Investor’s Business Daily Mutual Fund Index. When the index is above the 200MA line you are in the green and should to be invested. When it is below the 200MA line you the red light is on and you want to be in a money market fund. When those signals flash and you learn to act you will become very wealthy over the next 10 to 20 years. You will not lose your money when the market is going down.
It you take the time to go back in history, say 20 years and treat the S&P500 Index as a dollar value you will quickly see that buying and selling on this simple method would have made you a ton of money. No, there is not very much trading involved. You will only be buying or selling about once each year. It will not take much of your time and you will sleep better, especially when the market is crashing and your money is safely tucked away.
When to sell stocks
Currently the green signal is on to be invested according to the IBD Mutual Fund Index. The red signal will come on that tells you it is time to sell when the index plunges below the 200MA line. Pay attention to the signals. You don’t want to lose everything.
Build your own stock trade system
Your choice of what method to enter and exit stocks plays a critical part in your stock market success.
A great trading system looks for low risk opportunities to enter a stock. Knowing at exactly what price signal to enter and when to exit – even if it is for a small loss – will keep your account growing. As long as you consistently follow the rules laid out by a well designed trading plan, you can count on steadily growing your trading account.
My favorite trading pattern does a great job of identifying stock likely to move rapidly in your favor.
There is no reason to be trading stocks that are not ready to deliver the biggest gains in the least amount of time.
If you are serious about taking your stock trading to a higher level, then read about this trading pattern.
William is an investment advisor and has been writing about objective, methodical
approaches to investing for over 10 years. He has helped hundreds of people make better
investment decisions. To find out more about his approach and his FREE Newsletter, please