How do I make money trading?

Day/swing trading is a skill that is perfected over time.  During your journey, will continue to grow and learn new things as you go along.  You will make money and you will lose money, but your losses can be minimized by making sure you have a trade plan and stick to it. 

I would suggest trading stocks in between $0.01 – $5 with at least $300k in trading volume.  High liquidity make is easier to enter and exit the trades.  Also, there are sub-penny stocks in between $0.0001 – $0.0099 that can be traded as well but this will depend on your broker.          

Trade on your own terms

There are several free and paid tools out there that you can use to get the ball rolling, but the two most important tools I use are below. 

Finviz.com Scanner – They have a free scanner that you can use to find stocks based on specific criteria such as price, sector, industry, and volume.  Please note that using the service as a free or registered member, there will be limitations on the features offered but you can sign up as an Elite member and unlock all of the features.  I provided the chart comparison of all of the features included for each member level below, but the free member version should be good enough for finding stocks to trade.

Finviz pricing and features
FINVIZ*Elite pricing

Stockcharts.com – They offer a free charting tool that you can use to spot a stock trend.  Please note that using the service as a free member, there will be limitations on the features offered but you can sign up as a paid member.  There are four service levels available.  I provided the chart comparison of all of the features included for each service level below.

Stockcharts pricing and features

Scanz – Is a “all in one” market scanning platform for day traders and swing traders.  It provides real-time data and news.  Your broker provides the same real-time data and news,  but from my experience it does not work as well.  The real-time news feed displayed for stocks are posted instantly on scanz where as on other broker platforms, it’s either delayed or not displayed at all.  This gives you a huge advantage when looking for stocks to trade and getting in before the run up.  Please note that this is paid service, but it a great tool to have in your toolbox since it is very affordable. They do offer a free 7-day trial to test it out the service which is good.  I provided the services offered along with the features included for each and the pricing below.

Scanz pricing and features

I would recommend to not use too many technical indicators when charting stocks.  I listed the common technical indicators and overlays that I use along with the value/parameter setting for each one below.  All of the definitions were pulled from Wikipedia.  If you would like a in depth understanding of how each indicator works, you can click on the link of each one to get a full overview. 

  1. Moving average convergence/divergence (MACD)is a trading indicator used in technical analysis of stock prices, created by Gerald Appel in the late 1970s.[1] It is designed to reveal changes in the strength, direction, momentum, and duration of a trend in a stock’s price.  The most commonly used values/parameters are 12,26,9 but I use 6,13,5.  If you prefer to listen to the audio of the definition and look at pictured examples, you can click here
  • Relative strength index (RSI) – is a technical indicator used in the analysis of financial markets. It is intended to chart the current and historical strength or weakness of a stock or market based on the closing prices of a recent trading period. The indicator should not be confused with relative strength.  The most commonly used value/parameter is 14 but I use 10.  If you prefer to listen to the audio of the definition and look at pictured examples, you can click here.
  • Volume-weighted average price (VWAP) – is the ratio of the value traded to total volume traded over a particular time horizon (usually one day). It is a measure of the average price at which a stock is traded over the trading horizon.  If you prefer to listen to the audio of the definition and look at pictured examples, you can click here.
  • Simple Moving Average (SMA) – is the unweighted mean of the previous n data. However, in science and engineering, the mean is normally taken from an equal number of data on either side of a central value.  If you prefer to listen to the audio of the definition and look at pictured examples, you can click here.

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