If you are, how much is the minimum should I use? What books did you read? What did you do? Are there any mentors I can learn from? I want to take care of my family, especially my parents who are retired.
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This can work – it depends on how much attention you’re willing to devote to it. I have found that any time I take my attention off of the market for a few hours or a few days, I’m punished by an opportunistic turn that I missed. This is not a maybe – it will happen if you’re not at your desk. And when I focus 9:15 through 4:15, I perform, with a couple hours homework a night.
The books recommended by others here are great. It’s hard to advise you further not knowing how much you do/don’t know about the market. The paper trading practice sites are an essential. Try those out in earnest and you’ll save yourself from unnecessary mistakes later when errors cost real money.
I find that it’s important to do a few things:
1. Chart the S&P for uptrends and downtrends – when you see an established trend the market will tend to move that way, and stay within the down slope and up slope "channel" in its daily activity for multiple days. This gives you added confidence as to when to "buy", when to "add to" your position, and when to cash out. When a stock busts out up or down that can be the opportunity to get in or out (depending on direction) of a given index, ETF, or stock. This will also help you stabilize your stock monitoring because you will focus on the stocks at present which are near "support (floor)" or ceiling (resistance)" positions. To help me do this, I’ve found it is incredibly valuable to have a second computer screen (I use two PCs because I’m mobile when I want to be) with several key screens of data/chart references.
One screen has no more than 6 stocks I’m watching that day, with charts on each screen.
One screen has all major sectors’ charts on it – by sector fund (USO, OIH, etc.)
One screen has 52 week uptrending stocks I’m monitoring for pullbacks
Other screens are categoric (e.g., AG companies)
2. Using other resources such as the 52 week high stocks (WSJ, YahooFinance, Google Finance, etc.), and Top 100 (IBD.com) are also opportunities to check for trends, and determine whether to jump on this momentum during a given day, or to wait for a pullback and get in before a multi-day upswing for a multi-day "swing" trade. If you put in the time, you will identify pending breakouts.
3. Listen to Fast Money to pick up on hot trends and expert interviews that can indicate stocks to watch since they have such a wide audience.
4. Keep track of volume levels and beware of low volume days.
5. Track sector movement and rotations. Institutional buyers will dictate what will move, whether it "makes sense" to you or not.
6. Listen to Art Cashen (sp?) – every morning about 9:15 AM EST before the market opens. His insights are usually good indicators to align with or watch for. Good pulse on the market.
7. Know that a margin account can be traded every day with no interest if you don’t carry it over night. Non-margin accounts will have a 3 day carry cycle until you can reinvest the funds.
Best wishes for success. Cramer can be a goof on some topics, but knowing what he’s tracking can also give you one or two key stocks to watch for the next day if conditions align to support those stocks. His trading rules lists are very good.
There are many people making money from stock, especially day trading.
If you’re going to be a decent day trader, $50,000 (in cash or market value) would be about the minimum to start with.
There’s no mentors out there, so you should try to get a job in the trading department of a brokerage firm, or start by being a clerk on the floor of an exchange. Clerking (working on the floor) you’ll learn fast, and the hard way.
Books to read
What Works on Wall Street by James O’Shaunessey, Beating the Street by Peter Lynch
One Up on Wall Street by Peter Lynch
Trading For A Living by Alexander Elder
Mastering the Trade” by John Caster
How to Make Money in Stocks” by William O’Neil
The Disciplined Trader by Mark Douglas
Get into the habit of making daily visits to some websites like Yahoo Finance and especially MSN Money.
Following the strategy lab analysts to get a feel for what the pro’s are doing and why. This site has some basic information for beginners. If any site offers free information, take it.
Other website that can provide instructions and help with procedures and terminology are Investopedia.com, Stock Charts.com, investorshub.com; and 1source4stocks.com
Visit some of the more professional websites like Zacks.com, Smart Money, Schaeffers.com, Trading Trend, Trading Markets, these website will have advertisers who are worth looking into also.
And remember, if they offer free information, get it.
Good luck on your education into the world of trading
Ok. this is a difficult question to answer, considering your financial situation. It seems that you are day-trading for the sake of income, which is not a smart idea. The reason is is two-fold. Most importantly, there is a law by the Securities Exchange Commission (the SEC) that all day-traders must have at least 25,000 dollars of equity (cash value) in their account. so you cannot day-trade under that amount. the second reason is that day-trading requires constant attention because you are looking at swings and ups-and-downs in short periods of time.
With regard to learning how to day-trade there are many different ways advocated in doing so. one such method is called technical analasys. this is analasys of charts of stocks with the objective of spotting a trend or a pattern which indicates a certain direction the stock will move in. Technical analasys is difficult and time-consuming. StockTA.com can help out with this, but research should be used to assist in your stock picks
Another way of day-trading is trading blue-chip stocks which are less volatile and therefore your risk of losing money is lessened, but on the other hand, so is your chance of reward.
I had started out the year day-trading volatile penny stocks. I went up 25% on my portfolio, and shortly thereafter took a dive. i am now down over 30%.
Everyone is so pessimistic about the stock market right now, so I take it to mean that now is the best time to invest (and yes, since that initial drop in January, I have been doing well in the stock market). I would not recommend day trading though until you really know what you are doing.
1. You should invest only what you are able to lose.
2. I would read only books written by well-respected investors like Warren Buffett or Peter Lynch. Beware of books written by unproven investors or people who promise that you’ll get rich quick. The stock market is not a very good place to get rich quick.
3. Check out Motley Fool – http://www.fool.com/ – for a lot of free information and advice about investing. I am subscribed to their Stock Advisor newsletter, which I am very happy with.
4. Set up some pretend portfolios on Yahoo! Finance – http://finance.yahoo.com/ – to get the hang of what works and what doesn’t before you put real money in.
*. If you’re still interested in day trading, look into Technical Analysis – http://en.wikipedia.org/wiki/Technical_Analysis . However, technical analysis has never worked well for me.
Good luck!