At the end of the day, micro cap trades aren’t easy! No one refutes this. In order to be successful, you need a solid action plan that goes right alongside market movements. Charts are a big help, but your plan requires more than technical analysis. So why is it that so many traders are losing money in the markets? Here are 3 things that can help you tremendously when looking for good penny stocks to watch ^(http://www.ucontext.com/cbhop.php/4314/0/934f00ad10328998c4c6cb847c4af416/penny+stocks+to+watch) so you can avoid failure like many others.

The moment you begin, the number on signal to get in on is a company with a competitive edge on the market. This requires having built new deals with larger companies or brand new resources such as new factories or areas to gather raw materials. A core feature you should try to locate is a contract with a well known business when looking for this particular factor in a trade.

Next up, I recommend going into a penny stock that has a upward trend in earnings. If the stock has a downward or sideways trend in their profits, you can bet that the price of the stock itself will follow suit. The opposite, however, is just as true and when the penny stock you are trading has a positive earnings report, you can bet that it will show some gains if the trend continues.

Lastly, find yourself a chart reading that shows signs of movement upwards. If stock chart reading isn’t your strong suit, the majority of it consists of very simple to understand shapes such as the double bottom or ascending triangle. Both these particular patterns are commonly an indication that the market will drive price upwards so you can get profits more quickly and easily.

The cold hard truth is penny stock ^(http://www.ucontext.com/cbhop.php/4314/0/12a049e7f8d45ff10f8a65c974f1265d/penny+stock) trading can be a real test on mental capacity and endurance. Luckily enough, the right techniques for trading penny stocks ^(http://www.ucontext.com/cbhop.php/4314/0/12a049e7f8d45ff10f8a65c974f1265d/penny+stocks) will give you great wealth and freedom if you have the courage to take action! Take a look at a penny stock with these particular features and you will bring the cash home more regularly than in other situations.

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The market has resumed its daily uptrend and in the same move traded above the neckline of a weekly inverse head & shoulders (H&S). The target for the H&S would be the high for the year ^(http://www.ucontext.com/cbhop.php/4314/0/79d7cd45f4e2ee67bcd64ccf24ab42c4/high+for+the+year), while on the daily charts we have resistance from a pivot at S&P 1173, Nasdaq 2425. The Dow is also looking strong, while the Russell 2000 small cap index is lagging. The market strength comes along with weakness in the US dollar, pushed lower by statements from the Fed.

Despite the weakness in the dollar, crude oil has remained flat for several weeks, with reduced demand offsetting the weaker dollar. Gold, however, made new all time highs last week and agricultural products (DBA) continued the uptrend which started at the beginning of June. Unless we see a turn in the dollar or a dramatic (scary) rally in crude, look to buy pullbacks in the market as it moves back to the high for the year.

Gap Inc (GPS) is part of the very strong retail sector, and while it has not shown the strength of TJX or COST it has put in a second higher low on the daily chart and may be moving back into an uptrend. On Friday, GPS triggered a daily buy setup on solid volume after declining for 3 days on ligher volume. The technical entry would be above Friday’s high, with a stop under Thursday’s low, but a pullback on the 15min or 60 min chart could provide a much more favorable reward/risk ratio. First target would be $19.18, with potential to move up to $20.

After consolidating sideways into a short term daily uptrend line, Expedia (EXPE) broke out on Friday with an increase in volume, and made another new 52 week high (after making one the prior week). The next daily resistance dates back to late 2007, but a target could be set at $30.40, a measured move from $28 equal to the move from $26.53 to $28.90 leading into the daily consolidation. A long entry could be taken over $29.85 with a stop under $29.50 (from the 60 minute chart). The next target could be at $32.70, the next 2007 resistance level.

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The U.S. is not the only stock market ^(http://www.ucontext.com/cbhop.php/4314/0/f19b18f69dfcc10a12850cdfaf93a2b0/stock+market) around. There are other markets in other countries some large and some small. But all of them have opportunities. Without a doubt there are plenty of opportunities all over the world at any given time if you know where to look.

In the U.S. the Dow Jones is a good indicator of how strong the market is at a given time. Other countries will also have their own indexes. By looking and comparing different indexes you can see just how well other countries have done in relationship to one another.

If the U.S. market is volatile and not doing very well then you can always look at say the Chinese market to see how they are performing. Or you could go over and see how different European countries are doing. It is always good to know what is going on in other countries.

Why is this? Because markets do not always trend together. By finding the ones that are performing the best you can then find stocks in that country that are likely to do well and then set all of the odds in your favor.

Wouldn’t it be a nice idea to move from bulls market to bulls market ^(http://www.ucontext.com/cbhop.php/4314/0/bbb1da9a6bcbe57c4d3f06bc0e9065f2/bulls+market) no matter where they may be? Well if you are looking at other countries then it will be easier to do that because there are more opportunities out there. This is the general idea and it can work out pretty well.

Most of the time the world’s markets actually move together. If something like the U.S. is falling then it is likely going to affect the rest of the world. But it does not always have to work out that way. There have been plenty of times when 1 country has seen a raging bulls market while another sees a falling market. But checking it out you know where the money is and were the best odds of success are.

Technology has made it easier then ever to invest into different countries and different stocks in those countries, so why not take advantage of it? If it has the potential to increase your stock returns it can be worth taking a look at.

For more on investing in other countries visit this Investing in Foreign Stocks ^(http://www.stocks-simplified.com/How-to-Buy-Foreign-Stocks.html) page and make sure to get this list of Foreign Stock Market Exchanges ^(http://www.stocks-simplified.com/Foreign-Stock-Exchanges.html) Also published at Benefits Of Looking At Foreign Stock Exchanges ^(http://www.uberarticles.com/home.php?id=1356160&p=56607).

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Day trading most commonly refers to the practice of buying and selling stocks during the day so that at the end of the day you don’t hold any shares overnight; you sell as many shares as you buy. You make money on the difference between the purchase and sales prices.

The main motivation for this style of trading is to make money every day so you don’t sit on the shares , plus of course you eliminate the risk that the shares go down in value overnight. the motivation of this style of trading is to reduce the risk of holding a position overnight where the open price may have significantly changed from the previous day’s closing price.

NASDAQ defined day trading by saying somebody is a Daytrader if he makes more than four buy and sell orders over a five-day period.

Prior to the year 2000 it was not uncommon for some of the most successful Daytraders to make more than a million dollars in a single day.

There were dozens of Daytrading Chatrooms where people were “told” what to buy and when to buy it. Some Chatrooms had more than 500 members.

And most Daytraders, it is estimated as high as 99%, lost their shirt. One of the reasons they lost their shirt is because they could trade on Margin.

Trading on Margin means that the brokerage firm which executes your trades will lend you up to 5 times your investment. So if you had $10,000 in your trading account you could in some cases trade with $50,000.

However, if you lost on your trades, repayment was due immediately.

Since the heady dot com days of the year 2000 DayTrading has gone out of style and out of range.

Most brokerage firms have gone under or have consolidated, and staff has been reduced in the remaining firms by about 80%.

Trades that used to cost $35 to execute can now be had for as low as $4.-

Initially it happened because President Bush talked the economy down and Mr Greenspan kept on raising the interest rate to such a level that all optimism disappeared from the Market.

Up until this time like clockwork 2 or 3 days a week there were Stocks, mainly Internet Stocks, that would rise more than 30% early in the morning and then fall the same amount five minutes before closing so people could take profit.

If you were on the ball you could make a lot of money as a DayTrader.

You could also lose a lot of money.

Those days no longer exist.

It is very rare to see stocks vary more than 30% in one day so the profit potential first of all is not as great, and the ability to catch a percentage of the increase in the price of a stock has also lessened.

One of the reasons also is that Internet Stocks which were totally overvalued are no longer overvalued and as a matter of fact have risen much less than any other type of Stock.

Another reason is that there are very few IPO’s and even Google’s IPO did not take off for quite some time.

If it was not for the spectacular performance of Google , Internet Stocks lost more than 8% in 2005.

Even Ebay lost more than a quarter of its value.

However, if you are shrewd, you can still make money as a DayTrader but it ain’t easy.

What do you think happens when a company invents a car that runs on water?

If you could get news about this company very early you could make a lot of money.

Not many people know that you can trade the NASDAQ Stock Market as early as 6 AM.

So if you are a Stock Market News Hound and like to get up really early in the morning and have nerves of steel you could buy the stock at 6 AM and sell it at 9.29 AM to everybody else starting a regular trading day.

This will not happen very often, the fact that there is spectacular news.

But if you are patient it may happen once a month.

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Well this is how things worked out.
I made a judgment on the majority of people voting against the incumbent
government. Which they did.
However the voting was so close the parliament was hung until an independent
voted with the present government. Even though the majority of votes went against
them they were re-installed.
This saw a temporary drop in the market because of the Labor Party policy of
a new mining tax. So a little bit of a reaction there.
I sold one of my experimental purchases at a small loss but kept the
other and now that all the hoo haa has settled down I am seeing a profit.
My conclusion here is that the majority of the market trades on sentiment not on
any facts or figures of individual companies. Making it a hit and miss
occupation at best.
The exception is, if you can do your homework and find a stock of value
while it is still in it’s infancy and hold it until the market trends upwards.
Check out the video in one of my previous posts (make you smile)
MR Ed.

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