It is a well known fact that nobody can predict the future trend of the market. Based on information, facts, fundamental analysis and technical analysis we can make a informed guess on what can be the future trend of the market. This kind of a guessing works better when the trading is for a long term period. It is verify difficult to predict if say you execute a trade at 9am and plan to exit the trade by earning a profit at 10am. Even seasoned players in the stock markets prefer trades where they can hold on for a longer period and wait for the prices to move in the expected direction.

If you are looking at short term trading or day trading then you have to follow the market continuously and sit in front of the computer screen. This is not possible for everyone to do. Secondly, if you are a new entrant who has just entered the field of stock trading then I would strongly advise you not to do day trading or short term trading immediately. Wait for sometime. Gain experience. Understand the market movements. Understand how professionals trade. Most important, try to learn about yourself. Trading is a highly personal business, a trader should never allow emotions to take over while trading.

Experienced and professional investors rely, to some extent, on market timing for their success. They base their trading decisions on fundamental analysis of the markets, technical analysis of individual companies, personal intuition, or all of the above, their ultimate success is on account of the right trades they made at the right time. They follow the strategy of holding for extended periods of time and are based on buy-and-hold investment strategies. You can also try this strategy. It works well for new entrants as well as hardened players of the stock market.

Remember, for a trader his most valuable asset is his trading capital. The most important rule for him is to “Preserve his capital”. To preserve his capital there are many rules, for both short term trading and long term trading. More than anything else a trader should have a trading plan. The plan should be, preferably, a tested plan. A plan can be tested by back testing. You take the data for the past couple of months and run it thru your plan. If it gives you a sizeable profit or a return that is as per your plan then you can confidently apply this plan for your trading. Plan’s should not be considered as sacred documents that cannot be changed. You have to keep watching the markets, your performance and any changes that are happening in the trading environment. Based on this you should keep updating and changing your strategies and your plans.

Have you thought over why so many stock traders fail and only a few keep winning. These winners not only preserve their capital but also make a sizeable profit regularly. It is because many stock traders do not follow the rules. Successful stock traders cut their losses short and move on to the next trade. Also they hold no grudges against any one, neither the market nor themselves. Losers hold on to falling stocks mostly because of psychological issues until making a rational decision has long since gone from their control. You need strong inner strengths to become a winner in the stock market. It is not difficult. All that you need is discipline and a trading plan to follow. Forget your ego and follow your trading plan in an objective manner and become one of the few successful traders.