 01/11/2021 What to Do Before Every Trade ✔️ Why you need a thoughtful approach to every single trade... ✔️ There are thousands of stocks to trade — find out how to know which ones to watch... ✔️ And how an everyday trader like you can level up in the markets with mentorship and twice-daily webinars...  Before you ever place a trade, you need to do a few specific things.
Sponsored Ad  1. Build a Focus List
You can't trade everything. Nor can you be up to speed on every hot trend in the market.
So don't try to be. Instead, create a focus list of the absolute best stocks with the highest reward/risk ratio.
Your list doesn't need to be excessively long either. My current focus list that I share with all my students only has eight stocks on it.
There are more than 7,500 stocks listed on NYSE and Nasdaq combined. No human can keep up with all of them.
The market's extremely bullish at the moment, and lots of stocks are rising. Keep your focus on only the cream of the crop.
Most people want to focus on big names like Apple Inc. (NASDAQ: AAPL) and Amazon.com, Inc. (NASDAQ: AMZN)...
But not me … I'm a trophy hunter. I want the big winners. Many of the stocks I traded in 2020 had huge gains.*
I like to trade stocks like Applied UV, Inc. (NASDAQ: AUVI), which doubled in only a few hours. Or there's Beam Global (NASDAQ: BEEM) that spiked more than 650% over the course of three months.
Use your focus list to narrow your options. Then make notes about each stock on your list. What's the sector, the float? Is it above or below the 50-day moving average?
Picking the right stocks is only the beginning. You need to know how and when to trade them. 2. Plan Your Entry — Never Chase
As I mentioned, we're in a bull market. There are plenty of stocks that are on the move.
There's also a lot of degenerate gamblers in the market — tons of new traders who have no idea what they're doing.
They get FOMO (fear of missing out) and end up driving insane price spikes. Don't get caught up in the hype.
When you see a stock spiking, it's probably best to let it go. Never chase a stock. You want to buy before there's a big rush for shares or not at all.
The best traders sell into big spikes — they don't buy into them. Focus on the risk you're taking versus the potential reward.
I stick to the stocks with at least three times more potential reward than risk. But with the market the way it is, I've been finding stocks with five to one or more.
Don't risk $1 to make $1. Self-sufficient traders don't go after coin flips. Instead, self-sufficient traders go after the high-reward, low-risk plays.
It's all about the odds.
I think it's better to miss a trade altogether than come in too late. There will always be another trade. Don't get FOMO and let your emotions make the decisions for you.
Focus on getting the best odds for your money. Sponsored Ad "Here's An Incredible Opportunity toWork With a Top Swing Trader…" (This is designed for my most select group of readers)  There are a few openings in my Inner Circle.
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3. Make an Exit Plan
Traders aren't investors, and swing trading isn't holding and hoping. As a swing trader, I rarely hold a trade for more than a few months. The average hold time is about three to four weeks.
Don't get too hung up on the exact timing, though. The most important part of exiting your trades is doing it at the right price point. Some trades could be over in a day, others might take six months or more.
It's tough to tell how long a trade might take when you get in. Always have an exit plan, but don't get impatient.
You need to have a plan to be right and a plan to be wrong.
First, make a plan to be wrong and set a stop. A stop, or stop-loss, is the price where you know you're wrong. If the stock hits this level, you cut your losses and get out of the trade.
The stop is the risk level I've referenced several times today. You need to have a set risk level planned out ahead of time. Don't wait until you get into the trade to make an exit plan.
You need to plan your stop before you ever place the first buy order.
And never move your stop lower to keep yourself in a trade. You can always rebuy later.
It's OK to move your stop higher when the trade is working. That leads me to everyone's favorite part of trading — taking profits.
Just like you need a stop, you need to have a profit target planned out before you trade. This price should be three to 10 times away from your entry than your stop.
Remember, trading is risky. It's all about the odds. Don't take a big risk for small gains. Instead, look for opportunities to take a small risk for big profits.
When your profit target is met, take profits. You should be cashing out 25% to 75% of your position when your profit target gets hit. It's OK to hold some in case the price keeps climbing. Just be sure to move your stop up to protect your gains.
Limit your downside. The most important skill a trader can learn is risk management. Sponsored Ad Editor Note: Below is an important message from one of our highly valued sponsors. We receive compensation when you visit them through our links and/or purchase a product from them. Please read through their disclosures and privacy statements carefully.  Prepare, Prepare, Prepare
Trading is a profession that few ever master. The process isn't overly complicated, but still, it's incredibly challenging to become a skilled self-sufficient trader.
Focus on what you can control and make a plan to handle the things you can't.
Build a focus list. Make sure your entries are controlled and never chase a stock.
And always plan your exits ahead of time. Don't let a losing trade bankrupt you, and don't let a winner turn into a loser.
Cut your losers short and let your winners run.
Prepare now,
Paul Scolardi Editor, Swing Trade Millionaires
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*Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here.
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