If you want to learn to trade there are various sources you can go to for advice. You can consult trading guides, websites or speak with your broker or trading company. If you do want to know the facts and learn to trade there are some basic pieces of advice that will serve all traders well.
Firstly, anyone who wants to learn to trade should familiarise themselves with the stock market charts. If you learn how to read these charts then your trading can benefit from the technical analysis. Reading charts is a lot simpler than many people think. You simply study the past trends and price activity and predict future results based on that. Anyone who wants to learn to trade stands a better chance of success if they put in the time to learn to read market data.
Another step you could take if you want to learn to trade is to get to grips with the concepts of support and resistance. These two factors indicate price continuation, stall or reversal. Support refers to the lowest value a stock has tended to have, and resistance the highest. So if a stock was at its lowest value, based on previous figures, you would perhaps expect it to go back to its highest value or resistance. If suddenly the stock went beyond that highest value, it would now have a higher support and you would expect new, higher resistance values. It is often good to monitor firms to get a good idea of how such concepts work in reality. Often, if a person wants to learn to trade, they can benefit from monitoring the market and keeping track with certain stocks, to see if, hypothetically, they had bought that stock, what would have happened.
If you want to learn to trade, you do need to be prepared to be disciplined with yourself. It is all too easy once you begun trading to start changing your mind about certain timescales and start changing tactics. This can result in costly mistakes and chaotic trading. It is far safer to have a set of systemic rules and strategies for how you will conduct your trading. If you planned to exit the market at a certain point, make sure you do leave at that point. Perhaps you have a rule that once a stock has dropped 10% in value you will sell it, if so, stick to that rule and don’t get tempted to hold onto stocks and just ‘wait and see’.
If you do want to learn to trade, the markets out there are full of choice and opportunities. There is a lot of potential profit to be made and once mastered, trading can be an exciting activity. However, those that try skip learning the basics of the market or who fail to do sufficient planning usually end up losing out. So, if you want to learn to trade the best advice we could offer is make sure you set yourself up for profits and not for losses.
Risk warning: Spreadbetting, CFD trading and Forex are leveraged. This means they can result in losses exceeding your original deposit. Ensure you understand the risks, seek independent financial advice if necessary. The value of shares and the income from them may go down as well as up. Nothing on this website constitutes a solicitation or recommendation to enter into any security or investment.