Every successful QQQQ trader uses charts and technical analysis to determine of the market is trending or in consolidation. Then he or she chooses the appropriate trading strategy that suits the current market considtion. You can learn to perfect your timing of QQQQ trades by studying the charts and strategies.
How do I learn Technical Analysis? What should I not do?
There are several myths about trading stocks.
The truth about trading is this. What you need to make money is to concentrate, and gain experience in one or two instruments. That way, you would know the past behavior, and key levels that were significant. You can be profitable by trading just one stock, the QQQQ for example. Profitable trading of QQQQ is easier because it is a very liquid market
Myth Number 2:
"It is easier to make money by buying dips and selling rallies."
Indeed, you will make money if you had bought the dip prior to the rally, and vice-versa. But consider what would happen if the market continues to go lower after you had bought a stock. When would you know you made an incorrect trading decision? Many traders see a stock declining by a few dollars and think it is time to buy because they have seen a dip. This approach could work some of the times, but most of the time one would end up losing.
Myth Number 3:
"If the economic news is good, it is time to buy."
This is a short cut to disaster. Professional traders often buy in anticipation of news, and when the news is actually out, they get out of that trade, exactly when the novice wants to buy!
Myth Number 4:
"Averaging a position is a good way to reduce your holding cost."
Sure, if you are an investor who is committed to a position, then averaging is a great way to be ahead. But if you are a trader, then you are in an entirely different ball game. You can't keep adding to a losing position and hope it will turn out to be ok in a few days. The question is when will I know if a trade is bad? Technical analysis will give you some good clues.
Myth Number 5:
"You have to be trading daily, or regularly to make money."
This is another big mistake. You don't have to be in the market all the time to make money. Trading should not be an obsession for you. You should be patient for the right level to get into a trade. Otherwise, you will end up trading your emotions. In these pages, CraftyStox will give you invaluable clues. In the examples you see in these pages you will learn about timing your trade in the market, how to place your stop-loss order and what your exit strategy should be. Thus, you will be able to assess if the risk-reward trade off is good for you. And the best news is that this intelligence is available for you for free.
"Supports and resistances are only good while they hold."
This is only partially true.
But profitable trading is possible with
the help of charts.