When you start out day trading, one of the first things that you need to learn is about finding stocks to trade. That is the first step to becoming a day trader that makes money and not one of the masses that lose money. More than 90% of day traders lose money. That is a fact.
But you don’t have to be one of them. The 10% of day traders that do turn a profit do it with smarts, technique and strategies taught to them by experts. And it all starts with finding penny stocks to trade and capitalizing on those hot stocks.
What is going to be key is a daily watch list. When you get involved with a day trading education site, you can get the benefits of a bevy of instructors that can teach you about momentum day trading strategies, how to spot gappers and more. But one of the most valuable aspects is being in a day trading chat room that offers a daily watch list.
Because following a daily watch list and interacting with veteran traders, in a chat room, is, especially for aspiring traders, a great way to get experience. You can see the stocks that are featured in the daily watch list, see the veterans take positions in the stocks and explain their positions and learn why and how those stocks make the daily watch list.
What you want to look for in a daily watch list is ideas beyond the typical penny stock lists of many other sites out there. You need to be looking at the market each day for opportunities to make 5-10% in profits and rack up more and more of those each day. That is how you end up with real profits at the end of the week. Building up small wins gradually, rather than taking long positions and hoping they pay off big.
And when you get very good at that, you can start looking at a gap & go strategy. That is where you see stocks that are trending up in the early morning before the opening bell, with prices above what they closed at yesterday.
You search for a catalyst in the news, like an earnings report, make sure the number of shares out on the market are low enough that they might all be traded that day and you take your position. That is a slightly higher level of strategy and one that you would wise to learn thoroughly before you begin to implement it.