I’ve been getting a lot of e-mails regarding “What should I do when I want to begin investing or trading?” and its one that can be answered in many different ways. Everyone has there different types of ways of learning, and thoughts on what to do in the beginning stages, but here are my thoughts:
- Read Read Read! I hated reading before I began trading and spark noted everything for English class! The market today is news driven, what is going on in Switzerland with gold, Will OPEC cut production of oil to bring prices up? And various other questions. Now while some may say it doesn’t apply to a day trader, especially a penny stock trader, thats where your wrong. The market is forward looking, in bottom plays, over extended charts, etc. You need to be up on current news with gold for instance, if your holding a small cap gold stock and gold is falling further that’ll result in your stock going down. Reading general market headlines is a great first step to getting into the trading world.
- Find a few well known stocks to follow, what this will do is enable you to connect the headlines to the effects on the stocks your following. You cannot expect to dive into trading and not know what the Dow Jones is. Following some well known stocks help you understand the basic movements of a stock, how long they’ll run/fall, etc. They can be any sort of stocks that you like, AAPL, VZ, MSFT, etc. It doesn’t matter which, find 3-5 stocks and follow them along with their headlines.
- Begin looking at charts! stockcharts.com has excellent charts, and there are various books out there to teach you how to read candlestick charts, moving averages, etc. Charts are the essential part of a stock traders education. I look at hundreds of charts a week and analyze them to see if it is following my strategy and something that is a profitable trade. But the real way to learn charts is to sign up for Investors Corner here and use “IGPROMO” to get a discount on your membership! Read my in depth penny stock bible that takes you from “What Is A Stock” to technical indicators, then you can grab popcorn and watch live trades, trade analysis, trading tips, and more!
I hope I was able to answer some of the questions other teens, and adults have been asking! Get your feet wet with the stock market world and discovery some of the amazing possibilities it holds!