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Today, the surge in stock prices has made the trade market flourish with amazing results. With the rising and falling prices of stock in an instance, the stock trade market has made it crucial for all traders to be vigilant with each trade. Timing, along with the market knowledge of the stocks, is the most important aspect in stock trade. Thus, in order to be successful in trading stocks, it is imperative that you know which stocks to trade and at what time. Timely decision making is important when it comes to stock trading.
Selecting the right stocks for the trade can be difficult, especially if you’re new to the market. Stock selection does not depend on the popularity of a company or a brand name. The market variables change every day and to make the best out of your trade, you need to do a thorough analysis of the market. This can be challenging, but in order to make the right decision, you need to select the right time to start your trade. The best time to start off is early in the morning. Stock trading is similar to entering a battle and remember, nobody enters a battle unprepared! So, start preparing early and do a thorough analysis of the stock market in the morning.
Let us have a look at some techniques that will help you make the right decision:
Pre-Market analysis is Important:
In your pre-market analysis, look for stocks with value worth what you’re willing to spend. Volume is important, so look for stocks that are heavy in volume. Filter out stocks that trade thinly by checking the average volume for 30 days. Check the analysis for future market value of the stocks for picking the best ones out the list.
Dig Deeper into The Right Market:
Now, with your best selected stocks, do a clean trade off with high volume stocks and set your minimum value of the volume you want to trade, like 50,000 shares per 5-minute bar. This is what most of the traders will have their eyes on! You can also look for other loop holes or opportunities in the market that other traders don’t see by doing a much thorough analysis.
Define the Sectors and Domains:
Define your own sectors or domains you have a much deeper knowledge in, which can help you picking the right stocks. You can also use your previous experience in setting new boundaries or in enhancing your trading skills. The best way to improve your dealings is to focus on a single or at most 2 stocks for trade. Select them on the basis of popularity and or your previous experience.
Follow these simple guidelines to venture into the world of stock trade with ease.
Disclaimer: Please do not make any financial decision solely on the basis of information provided above. The views and ideas expressed in this article are solely of author and do not necessarily reflect ideas in general.