This is probably the easiest to understand and carry out and requires the least amount of preparation.
It’s as simple as having a mainline into the business news channels, understanding what news means for your particular stocks, and then getting in before anyone else.
Many day traders believe that the markets are cyclical, and what goes up must come down and vice versa.
So if they see a stock bottoming out, they will buy in to reap the next upswing benefit.
If you have carried out your research, you’ll know the underpriced companies based on their fundamentals. You’ll have a range of values that makes it attractive for your portfolio, and when it falls into that range, you buy.
Pattern trading is about playing human psychology. If traders see a stock constantly rising, they get nervous, and if they see it falling, they see a bargain in the offing.
This strategy has nothing to do with the stock’s value, but looks at the way the market is reacting.A technical indicator strategy looks at various aspects of stock performance and aims to buy in at the right sweet spot.