Day trading is one of those pursuits that cannot be quantified into a perfect analytics style that anyone can accomplish. Understanding trends and being able to read charts is important, so you need to have a head for numbers, but you also need to be able to think in abstract terms.
You can make money by news trading, or jumping on stocks that could bounce on earnings reports or the United States job reports. But learning how to trade penny stocks is a different story.
Penny stocks trading is never easy
Penny stocks, as far as day traders are concerned, can run from $2 to $10. Investing in penny stocks in the hopes of landing a winning lottery ticket, so to speak, is not ideal. What you want to do is learn a strategy and craft your own technique for identifying the best stocks possible and jumping on them before they spike, in order to profit. It takes the right tools, a keen mind and hours of screentime to learn how to do it correctly.
That is why finding a day trading education site with the right set up to teach you these strategies is so vital.
Find the right mentors and instructors
You want to be able to journey on your road to freedom with the right way to do things. Jumping into the markets with no experience and learning as you go is a recipe for disaster. You end up losing a lot of money with that strategy. Taking the time and effort to learn from expert instructors will set you off on the right path, right away.
Finding a day trading education site is good because you can get a chance to join a chat room with other novice traders that are in the same boat as you. You can watch other traders share their screens and show you how to approach the market each day. Plus, being part of a like-minded community allows you swap tricks and tips with the other beginning traders. It is the community that will keep you going, even when the going gets rough.
Managing your risk factors
Trading penny stocks can be risky. So that is why you want to start out in a paper trading room, allowing yourself the latitude and room to make mistakes. When you are trading virtual currency in real-world market conditions, you are making a leap that allows you to test out the techniques you are learning about without risking real cash. It is the best of both worlds.
While penny stocks can seem like the Wild Wild West of the relatively staid and genteel financial world, there is opportunity to make money, as long as you can cut through the stock scams and the pump and dump schemes.
Beware of stocks that are pushed by the insiders in the financial media. They are using getting bad information. And penny stocks are full of companies that do not have the same financial disclosure requirements as bigger companies. So you have less to go on. And others will fill the information vacuum with less than reliable info.
Be careful when you are learning how to trade penny stocks and you will be able to come out ahead.