Trading is inherently dangerous. Everyone knows that. We know that 90% of people who start to trade stocks eventually fail within the first year and most of their losses can be simply attributed to the fact that they didn’t follow any rules. They acted like gunsligners; randomly picking stocks with no systematic approach and hoping for...
Tag: beginner
What Is VWAP & How To Use When Trading
Volume Weighted Average Price (VWAP): A benchmark indicator that gives the average price a security has traded at throughout the day, based on both volume and price. VWAP is a very powerful indicator, and is in fact one of the only indicators that I use on my charts when I trade. If used correctly, it can...
Breakout Trading – Day Traders’ Dictionary
Breakout: A stock price moving above a defined level of resistance with increased volume. A breakout traders’ strategy is to initiate a long position after the stock price breaks above the resistance level. The key to trading breakouts is to focus on big, obvious chart breakouts (multi-day, multi-month, and multi-year work best, as well as...
Pattern Day Trader – Day Trading Dictionary
PDT Rule: Is a rule enforced by the Securities and Exchange Commission (SEC) that is given to traders who make four or more day trades in their margin account over a five-day period. A day trade is when you buy and sell a security within the same trading day. PDT Rule Mechanics Once your...
Swing Trading – Day Traders’ Dictionary
Swing Trading: A trading strategy where the trader attempts to profit from short term movements in a stock that may last anywhere from one day to a couple weeks in duration. Traders who swing trade are generally looking at the ‘bigger picture’ of the stock and tend to use critical levels of support and resistance,...
Bullish – Day Trading Dictionary
Bullish: A market mentality in which the investor believes prices will rise Investors who adopt a bull approach purchase securities under the assumption that they can sell them later at a higher price. Bulls are optimistic investors who are attempting to profit from the upward movement of stocks. NOTE: When a bullish investor enters a trade, they are considered...
My Top Setups for Trading Breakouts
Every Trader is looking for their A+ setup – the one that’ll increase their odds and make it possible to win most of their trades. The reality is, there’s no perfect setup. Sometimes things simply go wrong and there’s nothing you can do about that. But in an imperfect world, there are plenty of good...