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This Stock Trading Tutorial will show you how to trade stocks for double and triple digit gains!

 

You will find the secrets of successful trading in this trading tutorial.  Many believe that trading is about going for the "home run" stocks - the stocks that go from pennies to hundreds of dollars.  Not true.  Great trading results comes from following a plan that gives you a trading edge.

What follows is a blueprint for trading success.  Since you are part of a small group of intelligent people planning for success in the stock market, this stock trading tutorial will help you get the results you desire.

 

There is one type of stock most people fear.

Most people will have all the right reasons for not buying this type of stock.  And their logic is sound.  The justification for avoiding these stocks makes sense.

Have you ever wondered why the top professional athletes, or successful businessmen, or top-notch surgeons make the most money.  Because they are proven winners and will probably continue to produce the most points (athletes), make the most money (businessmen), or save the most lives (surgeons).

Who has the most chance of being the most valuable player: a previous Most Valuable Player winner or a rookie player?

The same rules apply in the stock market.  The stocks that tend to produce the biggest gains are the ones that have already done so.  Your success comes from finding those stocks, buying those stocks when the risk of losing is small, protecting yourself from huge losses, and managing the trade to extract the most profits possible.

And, yes, there is a way to make the double and triple digit gains.  Successful traders do so on a regular basis.

 

You are a successful trader.

Remember, successful traders make the choices that others are afraid to.  Picture yourself making this trade:

Your stock trading software has found a stock in late August 1999 that was more than quadrupled in less than six months.  There is no doubt in your mind that this stock is clearly a winner for the lucky people that bought this stock within the last six months.

 

stock market tutorial

 

Just because you have found a winning stock doesn't mean that you will buy the stock at any price.  No, you wait patiently for an opportunity to buy.  This opportunity shows up as a low risk, high probability of success pattern that you recognize.

You recognize the stock trading pattern because you have taken the time to understand what works and what doesn't work in the stock market.

Finally, your opportunity to buy happens on October 18th, 1999.  Normally, you would be a buyer, using a buy stop order, above the previous day's high.  Since not all brokers accept stop orders for this stock, MGIC, you place a market order to buy as the stock trades above the previous day's high.  Once you know your fill price, you immediately place a Good-Till-Cancel sell stop order with no limit below the previous day's low.

 

buy stop order

 

As often happens when you enter a stock as the price is rising, the stock continues to rise ... quickly.  Now you are in the enviable position of having a profitable position.

Then it becomes a matter of making sell stop adjustments.  For a strongly trending stock like Magic Software, your best course of action if to make adjustments as the stock makes a new high.  Each time that happens, move the sell stop order to just below the recent swing low.  Something like this ...

 

sell stop orders

 

In a matter of four months, you have yourself a true stock market winner.  A stock that has more than tripled in price from your entry to your exit.

 

The right tools and the right information bring you the right results.

Here's what you needed to make this trade a winner.

First, the stock was going up.  As obvious as that seems, it is probably the most important factor in determining the success of buying stocks with the expectation of profit.

Second, trading capital.  To put it bluntly, you need to have risk capital available to make any reasonable amount of money from trading stocks.

Third, a plan for protecting your trading capital once you have taken a position.  For you, this means using stop orders to protect from losing a significant portion of your account.  Also, only risk a small portion of your account on any one trade.  A good rule to follow is to risk no more than 3% of your account on any one trade.

Fourth, you must have a way of identifying the best stocks to trade.  You can rely on someone else; your broker, a friend, a chat site, to find the best stocks to trade.  Even better, is to have stock trading software find the stocks for you.

Fifth, an entry signal that is reliable and allows for small losses if wrong.  Using trading patterns that occur regularly and have a high success rate accomplishes just that.

 

This stock trading tutorial is finished, but you are just getting started.

This is where your results take off.  Go find the winning stocks!  Yes, it takes work on your part to find them then trade them.  You have the tools available ... sign up now for the Stock Trading Course which gives you five powerful patterns to look for.

 

 

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Dave

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*** Article by Dave Wooding of the Wooding Trading Company. Dave's site includes useful stock market trading information.  Visit http://www.woodingtrading.com for more FREE information about how the stock market works, trading tutorials and stock market education.  If you would like to receive information on a regular basis, simply sign up at http://www.woodingtrading.com/stock-market-newsletter.html

 

 

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