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Online Trades

Online Trades in the Stock Market

When placing online trades in the stock market you will be happy to know that you have many options available at your disposal. Many feel that trading stock online is not as hard as some make it out to be. The hardest part for the most part is working up the courage to make your first trade! You determine your risk tolerance and implement trading strategies that are a good fit. Many people love the idea of stock trading online themselves rather than going through an online stock broker. It gives them a sense of control and the hands-on approach to controlling their own assets.

While you can earn a great return on investment investors must be sure that they invest in themselves first. While trading stocks online it is as easy as click of a button, but so is losing your hard earned money! Investors must invest in themselves through education, by taking an online stock trading course, reading lots of books about the stock market, and they must also paper trade first to ensure that their trading strategies and stock trading plan work. Successful investors will tell you that paper trading is a must before investing real money. Start out with moderate investments first, and then work your way up as you begin to see yourself succeed. 

There are numerous advantages to placing online trades. For starters, it is a fully automated process that does not require you to go through a stock broker. You also have access to advanced trading tools through your online trading system, real-time market data, and the ability to trade multiple markets! Obviously, since you do not have to go through a broker, you also have faster trade execution that is vital to intraday trading. Additionally the rates are cheaper for those that pay commission rates based on bulk trading. As you can see there are many advantages.

Keep in mind however that there of course are disadvantages as well. Placing online trades requires that you fulfill account minimum in your trading account per the requirements of your brokerage firm. Also you run the risk of losing money if there is a technical issue with your trading software or if there is a problem with your internet connection. Lastly, you have to be aware if your firm charges an inactivity fee.

It is the opinion of many traders that online stock trading advantages far outweigh the risks. Again, each stock trader must be sure to invest in themselves first, practice online paper trading, and stick to their trading plan. The stock market is a great place to make money and with the proper education and discipline traders can make a very nice profit.

Market Direction: There have been some extremely strong gains made in this market over the past few weeks. Which sectors should have been anticipated to move well during that time frame? There was no way to project which sectors would be showing the best strength. That is a function of candlestick signals. They are the graphic depiction of the accumulative knowledge of everybody buying and selling. These market conditions do not provide historical data that would foretell what sectors were perceived as  strong buys. Candlestick signals revealed which sectors the big money was coming back into.

Having that visual knowledge allows for taking advantage of some extremely big profits over the past few weeks. Putting these gains into our accounts was nothing more than analyzing what the signals were revealing. It demonstrated the Shipping stocks, oil stocks, and the mining and steel stocks were indicating very strong buy signals. Why was the strength coming into those sectors? That we may not know, but we do not have to know. The basis for making profits in the stock market is identifying which stocks are being bought aggressively.

We may not have the research capabilities to identify which sectors or stocks will be moving, but we can identify the results of others that have researched which sectors should be moving. The major advantage candlestick signals produce is revealing where money is moving to now. That greatly diminishes having money committed to areas where somebody anticipates profits in the future. Acting upon price movements that are occurring now greatly enhances a portfolio returns. You do not lose the time your money is sitting in a non-moving stock/sector and sitting with the risk of that sector never moving or possibly going lower.


The Dow has run into resistance at the 50 day moving average. It backed off from that level on Tuesday. It did not show any aggressive selling on Wednesday but then started to break down again in Thursday's trading. The failure to show strength on Thursday allowed for taking profits. Does this mean the uptrend is over? Definitely not, but after making returns of 20%, 30%, or greater, there is nothing wrong with putting some of those profits into your own account when the current market conditions show a high probability of pulling back. That pullback could be for two days or two weeks. Why risk being fully exposed to the market!


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Good investing,

The Candlestick Forum Team

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