الجمعة، سبتمبر 25، 2009

Swing Trading Vs Day Trading

Be honest, now. Back in '99 when seemingly every waiter and grocery-
store clerk had a stock portfolio, did you get rich day trading? Back
in those good old days there was plenty of talk about making money day
trading, but how many people do you know who actually accomplished it?
One look at a 10 year Nasdaq chart leaves no doubt that some people
did get rich on the way up'and a few of them probably had the good
sense to get out before it was too late. But most people 'played' the
market'and lost'through mindless buying of mutual funds, and by
accepting worthless corporate stock options in lieu of actual pay.
Fast forward to 2007. The Dow is at its historic high and the Nasdaq
is roaring back to life. It doesn't take a genius to realize that now
is the time to think about trading again. But truth be told, most
people will not take the initiative to make their own trading
decisions. Most people will get burned all over again.
To really profit from the coming bull market you must commit yourself
to making your own trading decisions. Don't trust your broker, your
boss, or your brother-in-law. Only by assuming responsibility for your
financial future can you expect to achieve success; nobody is in a
hurry to do it for you.
Most people who do decide to trade on their own hook will naturally
think of day trading. And you can bet when the bull market takes off
plenty of pundits and gurus will be urging you to day trade. But for
most people day trading isn't a viable option, either because they
can't afford to sit in front of a computer screen all day, or because
they have enough common sense to realize day trading is a lethal game.
So how can you profitably trade?
The answer for many people is swing trading. Swing trading is the
practice of holding stock positions (long or short) for a few days to
a few weeks. You don't need to sit in front of your computer all day
with your finger on the panic button, and you don't have to play cat
and mouse with market makers looking to hang your scalp on their wall.
The typical moves made by a stock during a swing play will dwarf the
tweenies that day traders salivate over, and with sensible use of stop
orders you won't need to lose sleep at night fretting about the risk.
Day trading is a little like the World Series of Poker. Do you think
you could sit down with Greg Raymer or Chris Moneymaker and beat them
at a hand of No Limit Texas Hold 'em? When you day trade you're taking
the same chance. The people on the other side of your trades are
professional market makers. What the stock will do in the next day,
week or year may be beyond the control of any one person, but what
happens in the next 15 seconds depends entirely on the decisions of
individual traders. Your loss is their immediate gain, and these guys
(and gals) have been doing this for a long time. Even the most
perfectly formed setup quickly turns into a sucker-play because these
professionals know the newbies will take the bait. In the world of day
trading, the losers get their hat handed to them in short order.
With swing trading you get the same fair chance as everyone else,
institutional traders and individuals alike. As long as you trade
stocks with a reasonable amount of volume, you can rest assured that
no one trader, or even a group working in unison (which would be
illegal, to boot) has the resources to bully the market. Setting your
stop 5% below your entry point virtually guarantees that you won't get
scalped (it doesn't guarantee the stock won't move 5% against you, but
if it does it won't be because one trader decided to scalp you). And
the profit potential for a well played swing trade could be 10% in a
few days, or maybe 20-30% in a few weeks. Of course, it takes
knowledge and experience to identify the right trades, but your
chances of success are just as good as any Wall Street trader if
you're willing to take the time to 'plan your trade and trade your
plan.'
Truly outstanding bull markets only come along a few times in a
lifetime. Swing trading gives you a realistic chance of profiting from
those great bull markets. You already missed the last one in '99.
Don't miss out on this chance. Now is the time to start studying up on
swing trading so you'll be ready.

The Big 3 Of Profitable Trading And Simply No Way To Fail: http://eminits.key.to/

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