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Importance of Stop Loss in Stock investing.

Importance of Stop Loss in Stock investing. - 
               stock investing In the Stock market nobody their, whose all trade goes positive and as specially in day trading. To control your risk and loss stop loss is a very important factor. For successful day trading strategy you need to Stop losses means cut your loss, cut looser and let winner run. It’s a very important factor for successful Stock trading or Stock investing in the Stock market.

Generally majority people not easily able to find suitable stop loss. What is the best stop loss point for day trading as well as long investment,


my answer is simple, buy only when Stock price comes in demand zone and sell it in supply zone, and keep the lowest point of demand zone means strong support as a stop loss for long position.

Because once Stock goes below the strong support (demand zone), it means due to some reason supply increased then demand and exceeded then demand so price gone down and as per supply and demand theory when supply and demand becomes imbalance there is a big price movement, and if supply is more then demand, price goes down, and when demand is higher then supply then price goes higher. When you buying in strong demand zone and in case price goes below that then why you want to hold that position? Just cut it, and prepare for another because as per theory that price goes more down at lest up to the next strong support. That the reason smart investor or day trader strictly follows their stop loss.

Suppose you not cut your position when supply exceeded demand, lately what happed price goes more down and your emotion comes in picture and medias bombarding create one Psychology, prices goes more down, due to emotion you comes under pressure and finally you come out with big loss. So it’s a much better to loose less then lot.

Now you know the importance of stop loss in your day trading or Stock trading strategy. If you don't want to loose lot of money or stuck then you need to decide your stop loss before to buy or day trade. Without stop loss Never go for any investing or day trading including penny Stock trading.

Especially when you trading short, stop loss are a necessity, because in short sell there are no limit for loss, it just like “driving car without break“, you need to cover your risk, or profit and to control our risk we have only one tool stop loss. For successful day trading | Stock investing Stop loss is a key.

Remember before to buy any Stock, ETF, Option, Future or even penny Stock first find out important support and resistance, do enough research, decide stop loss, decide exit point after that go for Stock trading investing, this also best practice for day trading.


Related Reading

What is Day Trading?
How to start Day Trading?
What to trade in day trading?
What is best time to buy | sell for day trading?
How to find out Stock market trend for day trading?
How to find out Support | resistance for day trading or Stock trading?
How many Stock I can buy for day trading?
Is there any restriction from Stock Exchange for day trading?
 
 
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