What does it take to be successful as a day trader you ask? Well, it obviously takes some investment capital and a method of making the trades quickly, but this is easily accomplished via the Internet now. The real key to success is finding a method of picking the right stocks to invest in and getting your money invested at the right time, and that requires knowledge and timely information. The stock market moves up and down quickly and to take advantage of those movements you have to be prepared to act quickly when the opportunity arises. A few minutes can mean the difference between making a profit or taking a loss on your investment.

At this point you must be asking yourself, what does this guy have to gain from telling me how he invests in the stock market? Well, I don't have anything to gain directly from you investing as a day-trader unless I sell you stock I have at a profit. However, the more investors there are in a stock, the higher the stock generally rises in price, so it is in my best interest to promote stock investment, at least short term stock investments. To be absolutely candid, the stock market is quickly becoming a short term investment strategy, and I don't recommend that anyone hold a stock for months or years like was typically done in the pre-Internet era. Sure, it is still possible to gain 10, 20, or even 30% on some stocks in a long term investment, but why risk tying your money up for months or years when you can make the same kind of profit in a few minutes and keep your money more available and safer from market "crashes" in the form of cash 99% of the time? After suffering through the terrible stock market crash earlier this year and losing 60% of the profit I had made during the first three months of the year, I know I will NEVER go back to long term investing again!

To make a long day-trading story short, I have found by trial and error that the easiest way to dertermine which stocks to invest in is to watch the current market headline news. NEWS is what moves stocks up or down and you must act quickly when a stock makes a positive news announcement. This is easy to do if you follow one of the real-time news sites on the Internet like Market Watch. Simply keep a browser open to this site and watch the news releases each morning.

Next, when you see a good news release like a company buyout or an initial analyst rating of "strong buy" on a stock, get a quote on the current stock price and invest in the lower priced stocks (small/mid cap) because they are much more likely to rise a significant percent in price. A $1 rise in price is a 10% gain for a $10/share stock, but only a 1% gain for a $100/share stock.

Once you find a stock in the right price range, the next thing you must do is take a quick look at the stock's chart. IF the chart also indicates that the stock is ready to move up in price, THEN you make an investment. If the chart does not look good, then look for another stock to invest in that morning. How do you know what a good chart looks like? The easiest way for me to explain charts is to suggest you go to Stock Point after the market close and pull up the charts for all the stocks that showed significant gains that day. Take a look at the 30 day chart for each stock and include the Bollinger bands, Moving Average of Con/Div, and On Balance Volume lines for each one. It won't take you long to see the similarities and know what to look for in a chart.

That's all you need to know to pick a good stock! If you follow those steps and invest as quickly as possible after the news announcement, you WILL make a substantial profit day trading.

The last consideration is how many shares to buy. This is determined partially by how much money you have to invest. I recommend you start with at least $2000 (and $3-4000 is better). This will allow you to buy 400 shares of a $5 stock. It is pretty easy to make $.50/share on headline news stock increases so 400 shares will return a $200 profit (10% on your $2000 investment). If you buy 600-800 shares you can make $300-400 profit. There is a limit to the number of shares you can buy and sell of course, but the small time investor like myself has little to worry about when buying a stock that is trading a million shares or more per day. Some traders will buy and sell a stock 3 or 4 times in a day and work on profit margins as low as 1/16. Personally, I am happy making one trade each morning and trying to get the maximum profit from the difference between the daily high and low. Where else can you "work" an hour or so and make that kind of money?

If you have a computer and an internet connection and stock investing appeals to you, I urge you to take the time to investigate what I have shared. Then try a week of "dry-runs" pretending that you are investing before you actually open an account with a broker and start day-trading. When you feel comfortable and KNOW you can make a profit, then open an account with a discount broker and go for it! It's a very exciting way to start the day! Be well, and good luck!