Day trading in stocks has become a latest trend in marketing, as it allows traders to use the slight changes in the stock prices in a day to their benefits of making profits. Usually, stocks are bought and kept for weeks or months before sold into the market. But day trade gives giver income to traders. Although the profit is lucrative, day trade is connected to many risks, and it takes a good few years of experience to understand the tactics of it so as to maintain a consistent profit margin.
In order to select stocks today trade, these steps need to be followed:
- Make a price chart by collecting the data about price variations in one day. Make calculations on this chart periodically and calculate the changes in stock prices made daily.
- You can also prepare the charts with small periodical changes, like 5-10 minute changes in the stock prices. Hourly monitoring is easier for most people. By doing so, you will get a clear picture of the stock market changes.
- Next, a list should be made of the potential investment candidates. Search for stocks with high volume and large capitalization.
- Highlight the stocks in your chart so that you can observe its activities. Keep in mind that the stock with big highs and mall lows will give the more profit, although they appear to be risky.
- Check the stocks that will give a decent rate of return. These will be the most stable stocks as well. You will have a small list of candidates by now.
- Check the chart periodically again to perform the analysis. You will be able to select the stocks that have been narrowed out by calculating it twice.