6 Rules For Traders

Rule #1. USE TECHNICAL ANALYSIS: Trust the chart, forget the news. If something's cooking for a stock you have a better a chance of finding out, if you used Technical Analysis than if you tried to follow the news. News tells you what has already happened, charts tell you what will happen.

Rule #2. Discipline: Don't start buying because that's what everyone's doing, make your own decisions. Study the charts, consult a chartist and buy or sell only when you should. Try to keep the herd mentality in check.

Rule #3. Never go against the markets: Let the markets tell you where to go. If the markets are rallying be a bull if they are turn southwards, be prepared to turn on a dime!

Rule #4. Close a loosing position quickly: Don't let your losses mount. If you see the markets don't agree with you square off your positions ASAP.

Rule #5. Time is the money: Always know what time frame you are investing for. If you plan to make a quick buck off a penny stock while its going up, don't stay wedded to it long after the party is over.

Rule #6. Never bite more than you can chew: Remember to keep a cap on how much you will buy. Allocate an amount for trading and stick to it.