As a Day Trader if you want to earn daily profits regularly you should follow certain stock selection Techniques determine the entry (Buy) price level and Exit (sell) price level of your recommended stocks in real time.

At the time of opening bell, if your recommended stocks opens above previous day’s close price, but below previous day’s intra day high price and today’s target price, It is a positive indication that the price has got potential to achieve today’s target price. So immediately, you should buy that stock, hold it until it achieves target, and exit from that stock after booking your profit. If your recommended stock opens above previous day’s close price, it clearly confirms the uptrend momentum. This confirmed momentum attracts buying interest and this buying interest increases the demand and pushes the price of this stock to further higher levels up to its target price or above target price. The investors who are holding this stock will not sell this stock due to confirmed growth momentum and wait till it reaches to further higher levels to book more profit. This decreases the supply of this stock and increases the imbalance between demand and supply. Due to this imbalance in demand and supply (with more demand and less supply) the price will definitely move in upward direction till it reaches target price or above target price. If the price of your recommended stock, after opening favorably starts falling from that level, you should wait till it took support and you should enter into that stock at lower levels to book profit later.

In this way in Profit Targets Technique, you should take decision depending upon the opening price of your recommended stocks. You can use this technique as your regular day trading technique on every day. In this technique depending upon the price action of your recommended stocks, you can earn 2 to 4 % of profits on every trade. In this technique, you will enter into stocks only on confirmation of growth momentum. Therefore, the success rate of this technique will be more when compared to other normal day trading techniques.

In Profit Targets Technique, the profits will come within short period. If your recommended stocks opens with favorable price for you to purchase, in most cases you can book your profit before 11.00 a.m., Generally in stock market, intra day high price or intra day low price will be registered before 11.00 a.m., So in the case if you buy stocks at opening bell you can exit near target price after booking your profit before 11.00 a.m., if the price of your recommended stock, after opening favorably starts falling from that level, you should wait till it took support and you should enter into that stock at lower levels to book profit later. If the price starts falling from opening price, you should catch up intra day low price before 11.00 a.m., and enter into that stock at lower levels to book profits later. If your profit targets recommended stocks starts moving in downwards direction after opening favorably, you should enter into that stock at lower limit of the day’s trading range by analyzing that stock using pivot points technique which I discussed in this site to catch up intra day low price before 11.00 a.m., either at pivot support level 1 or at pivot support level 2 on evidence of support.

Always be flexible to book profits and don’t be greedy, Booking profits at every point is very important in order to earning money consistently, also it is advisable to sit out when you are in doubt and not trading for a day rather than doing it and incurring loss.

Source:Srinu

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