If you want to learn to trade the forex or stock markets it takes discipline and patience. All beginning traders need to learn what the markets do and how news can effect the trends in the forex markets. You should understand that to be successful you need a trading plan and as much education that you can get before trying to trade these markets. You should look for all the knowledge and wisdom you can find from older experienced forex or stock traders. Preserving your capitol should be your first concern before entering a trade. By having experience you will gain an advantage over the new traders who trade without any discipline.

New forex traders that are not experienced can lose all their capitol in a short time. You need to learn what to do and when to make trades. There are not good trades to be made everyday so you need to learn patience and discipline in your trading. This is the mistake most new forex traders make. They take trades that are not good and end up losing money by trading out of boredom. It takes time to learn the markets and you need to set aside the time to learn. Charts and technical indicators are the most important things to learn first. Pick a couple indicators like the MACD or CCI and learn them inside and out.

Most forex and stock brokers have very good trading platforms that you can learn these types of indicators on. Take the time to learn when it is time to buy and when to preserve your trading capitol. How much time you spend is up to you but the more time spent learning how to trade the better. You need to understand the losses are part of trading the forex or stock market. Write down why you took a loss and learn from the experience. This is how you will become more profitable in your trading. Make sure to understand the use of stop losses and how to use a trailing stop which will lead to more profits.

It is totally stupid to try and start trading without some kind of trading plan. Learn what you need to do to make yourself successful and put it in your stock or forex plan and review it weekly. Adjust your trading plan as needed this will make you a better trader overall and keep emotions out of trading. Make sure to write down your successes and what made that trade earn money. This is key to continuing to have profitable trades. You should make sure that you work in percentages and not money. An example would be to try and make 2% on each trade and set your stop loss at 1%. If you are in the money move your trailing stop 2% at a time. This is all part of having a trading plan and preserving you money on each forex or stock trade.

Just having all the important qualities required to succeed as a day trader won't help; proper selection of stocks for day trading is equally important. Generally day traders fail because they don't select a proper stock for day trading.

Certain rules that can help you in selection of stock for day trading are discussed here. These rules can be digested quickly to help you avoid the biggest pitfalls in trading. These rules include:

• Trade liquid stocks
• Avoid unpredictable (chaotic) stocks
• Trade stocks with good correlation
• Move with the trend
• Research

Trade liquid stocks

If you are stock market day trading, you may have noticed that many individual stocks are not very liquid, at least not liquid enough for the kind of defensive day trading I do. To use my crucial rule, “every trade starts out as a scalp until proven otherwise,” you have to trade something that is extremely liquid, or slippage will ruin you. However, if you are interested in stock market day trading, there are some stocks that do have excellent liquidity.

The eminis are one of the most liquid markets in the world, with very little slippage.

It is often said that liquidity is like oxygen to traders; without it, they are dead. Thus liquidity is the first and most important rule while selecting a stock for day trading.

A liquid stock is one, which has a high average trading volumes, so that it can be bought or sold in sufficient quantities without causing much impact on the prices.

It is advisable to day trade strictly in liquid shares less liquid stocks helps a trader buy or sell large quantities of shares without any problem of there being no buyers or sellers. While it could be argued that illiquid volatility also creates opportunity through rapid price change, statistics prove that volatile shares move the most in the least amount of time. Therefore, most opportunity dissipates while downside risk looms.

However, this is not a hard and fast rule, as the amount of liquidity depends on the quality of your trade.

Suppose you buy few shares, say 50 to 100 shares, then shares with average trading volume of 50,000 to 75, 000 will suffice, whereas if you buy few hundred or thousand shares then you need a stock with average trading volume of few lakh shares.

Some of the examples most liquid stocks include Reliance Industries [Get Quote], SBI [Get Quote], Infosys [Get Quote], ONGC [Get Quote] etc.

2. Avoid unpredictable (chaotic) stocks

Generally it is seen that stocks that are trading with low average daily volumes or stocks where some big news is soon expected, tend to trade in a highly unpredictable manner. Sometimes even after an important announcement -- which may be either good or bad (like big order, good results, bad results, plant shutdown etc) -- the stock may trade in a chaotic manner. So it is advisable to avoid such chaotic stocks.

Some of the mid caps, and most of the small caps especially those in S, T and Z group are chaotic stocks; better not to trade them from intraday point of view. They also have very low volume thereby increasing their unpredictability.

3. Trade stocks with good correlation

It is advisable to trade in stocks that have more in correlation with major indices and sectors. That is if the index or a sector moves up the stocks belonging to that index or sector also moves up and vice versa.

Stocks that track and trade in correlation with the group (sector) to which they belong are more readable & reliable, so that if any good/bad news comes in, affecting the sector as a whole, then you can depend on the stock to move in the manner as the overall sector is expected to move.

For instance, if the Indian rupee strengthens against the US dollar then all IT companies depending on US markets get adversely affected.

A stronger rupee means these IT companies will earn less from their exports. Conversely rupee weakening against the dollar leads to increase in their export earnings.

Profitable stock traders and investors recognize that trading certain stocks with momentum is among the fastest & most effective ways to harvest BIG piles of cash in the stock market.

The problem is that if you don't know what stocks to look for and how to approach them while limiting your risk, you won't even get close to making some profits.

 You don't necessarily have to trade momentum hot stocks all the time, but You can learn how to take advantage of them when you encounter the best opportunities while at the same time limiting your risk.

 If You want to learn how to pick & trade stocks with momentum in a simple and effective way every week, GRAB our Stock Market Day Trading Course and discover what youve been missing.

With options trading, you have the opportunity to leverage a small amount of money into large gains. Or a complete loss.

Strategies for options trading are really no different than stock trading. There are many systems that are available which you can learn. Clicking around online, you can find many systems and training opportunities for trading options.

To trade options, you have to demonstrate to your broker that you know what you are doing. Trading options is considerably more risky than trading stocks even though the strategies are similar. One way to convince your broker that you are knowledgeable enough for options trading is to take an options trading course. You will need to research online to find the best course.

After you have been trained in the fundamentals, and the risk, of options trading, you can approach your broker and set up an options trading account. No you are ready to start trading. Well, yes and no.

The first thing that you need is a trading plan or system. Intuition and gut feel are not a system. They are a good way to lose your money. Speaking of losing money, only invest money that you can afford to lose -- completely. That is, accept that you can loose all of it. You need to come up with a trading system, whether you find one online for a price, or have created your own system through extensive study. Then all you have to do is trade the plan.

And you will probably fail. Most people cannot execute a trading plan. They allow there emotion to get in their way. The reality, is that there are a lot of different ways to make money trading options. A lot of trading plans work just fine, they have a positive expectation. What does not work fine is the trader. Trading mentality is the key to making consistent money trading options.

How do you get this trading mentality? With practice. Options trading practice can be expensive when you are using your own money. However, most online trading brokerages allow you to set up a paper trading account. Set the paper account up with a balance equal to your initial brokerage balance. Trade the system on your paper account until you feel you can work the system without emotion. Then use your real account.

Hopefully, by the time you have started to trade options with real money, you have worked the system enough to be confident in it. As soon as you are using real money, your emotions will kick into high gear. Only trade a portion of your account until you can get over it. Work the system. It is your friend. Your emotions are not.

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