there Thousands of shares That you can trade in the financial market. In the United States, the number of publicly traded shares has risen to more than 4,000. Globally, there are more than 10,000 shares.
As such, for a trader, it is relatively difficult to find the best stocks to trade. And therefore, Most of the traders use the stock watchlist To determine the best stocks to trade.
Here are some tips for using a good stock watchlist and making more profits.
What is a watch list?
A stock watchlist is a group of stocks that a trader and investor focus on in a particular period. For example, a trader can create a watch list by Choose a number of companies who – which They are interested in it.
Another type of watch list is the one made up of Companies experiencing secondary movements In the market. In most cases, this watch list consists of companies that have the potential to make big strides When the market opens.
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A good day trading watchlist should always have a list of companies And the reasons for that They see strong moves. At DTTW™, we have one of the best free watchlists (Via TraderTv LiveIt is sent every morning before the market opens.
One of the reasons this watchlist is so popular is that it Provides accurate and well thought out reasons Why do stocks show strong moves?
Another reason is that it is Followed by a live trading sessionOur experienced traders execute trades right in front of the camera.
Tips for using the stock watchlist
You can sign up for a watch list and read what’s being reported, but that’s definitely not the best way to take advantage of this information or get into a deal.
How do we do that then? There are some simple steps to follow to increase the effectiveness of our selection and avoid opening a position for the wrong reasons.
Find the reasons for the movements
One of the most important tips for using a stock watchlist is Find the reason The stock goes up or down. Luckily, In most cases, these triggers are easy to find. For example, you can just do a Google search and find the reasons to move. Some of the most important motivators are:
- earnings In most cases, companies that publish their quarterly results tend to show significant moves before the market opens.
- change management Sometimes a change of company management can lead to big moves.
- Investigation When a company is investigated by a major regulator such as the Federal Trade Commission, it can lead to a steep decline. Private investigations such as a short report can lead to a stock dump.
- court victory Sometimes a court win can lead to big moves in the stock.
- FDA approval A biopharmaceutical company could see big moves when a drug in the pipeline is approved by the Food and Drug Administration.
A good example of a watch list is shown in the chart below. As shown, Huadi International is the biggest winner, with a 90% gain. A quick Google search shows that the stock popped up after the company posted strong results.
In addition to Google search, you can use Tools like Webul and Yahoo Finance To find out the reasons for the rise of the stock.
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Knowing why a stock goes up or down can help you a lot with that Determine whether it will continue to move in that direction or collapse. For example, a stock that rises sharply after a merger and acquisition deal may have little upside in the future.
Determine support and resistance levels
Another important tip for using the watchlist is to identify support and resistance levels. a the support known as A floor where the arrow struggles to move down while resistance It is a level where he struggles to move up.
Most traders use these levels to determine whether to buy or sell an asset Where to place stop loss and take profit.
One way to do this analysis is through Using multi time frame analysis. This is a type of analysis where the trader looks at key levels across different time frames. This level will help you know if you want to buy the asset or sell it.
It also identifies points of support and resistance, Always include the concept of volume in it. In most cases, a major movement that is not supported by volume tends to cause a significant reversal.
keep it simple
Always keep your watch list as simple as possible. For example, instead of following hundreds of companies, Just put a watch list with no more than 10 companies And we analyze it.
Focusing on too many companies often leads to confusion. Also, it will make the trading process long and complicated.
Additionally, as a merchant, Don’t want to know too much about the company. This means that you should not do a lot of basic analysis on it like doing assessments and analyzing competitors. These in-depth analyzes are only important for investors who focus on long-term holdings.
While that, as a traderyou should always Focus on the main details like trading the sounda key Support and resistance levelsand the the reason for price movement. With this information, it is relatively easy to open and close trades.
Use TraderTV
Finally, we highly recommend including your trading watchlist with TraderTV. TraderTV is one of the Most Active YouTube Channels In the industry with more than 300 thousand subscribers.
It is a useful channel where members of the DTTW™ trading floor discuss the main issues of the day and then carry out trades live.
this channel Perfect for both novice and experienced traders. Beginners will learn more about how to trade while experienced traders will get new trading ideas.
Summary
In this article, we took a look at what a trading watchlist is and outlined some popular strategies to use. We have also highlighted some of the top reasons why you should use TraderTV in your trading activities.