Four Short Term Trading Strategies That Work

Strategy is key when it comes to short term trading

. Many investors dream of achieving success with short term trading strategies, but few succeed.

This is where strategy comes into play - how will you enter and exit a short term trade? Think of it as a game of chess - one move forward, one back - with actual monetary reward at the checkmate.

Here are a few short term trading strategies that have been proven to work.

Trend trading -- This type of trading is a little bit uncommon in the world of short term trading strategies, but trend trading happens when an investor buys a stock after it has established a trend of extremely high highs and better-than-average lows. The investor's strategy is then to stay with that stock until the trend is over, then selling as quickly as possible.

Counter-trend trading - Most counter-trend trading strategies look for potential reversals in market trends. This strategy is very short-term in nature and involves purchasing stock when prices are low and selling when they're high. Unlike trend trading, counter trend trading is more popular with short term traders and works best for those who work around large, core trades because gains are usually quite low.

Pullback trading - This strategy involves buying a stock when it's been weak for a short time and then selling that same stock when it's temporarily strong. Pullback trading is considered a short term form of reversion trading. Investors look for stocks that been inflated beyond their normal levels and buy them until they level out again.

Breakout trading - This strategy is great for investors who can act fast. The goal is to buy up stocks that move up suddenly when prices have been flat or stalling. When a breakout stock is in a downward shift, it's called a "breakdown".

Perhaps the best strategy when it comes to short term trading is simply discipline. Create your own rules and stick to them, know when and how to sell a trade when it goes bad, have patience when it comes to the best time to work a strategy, and you'll be ahead of most people who attempt short term investing. Just as it would in any other area of your life, discipline takes time and patience to master. However, if it's the only short term trading strategy you try, it will be worth it!

Copyright (c) 2010 John Howell

by: John Howell

POST COMMENT

Excellent Info - 2 Amazing Strategies To Prolong Ejaculation - She Will Think You'Re A Sexual Superman! Free Traffic Generation Method: Linking Strategies Starcraft 2 Strategies - Key Strategy in Winning the Zerg Campaign Starcraft 2 Strategies - The Zerg Campaign StarCraft 2 Strategies - The Terran Campaign Craft 2 Strategies - Key Strategies For Terrans Vs Protoss War Starcraft 2 Strategies - Quick Strategies For Zergs, Protoss, and Terrans Starcraft 2 Marine Guide - Build Orders, Strategies, Counters, Rushes And More For Marines In SC2 Starcraft 2 Marauder Guide - The Best Strategies, Counters, Rushes And Build Orders For Marauders In SC2 Starcraft 2 Ghost Guide - The Best Strategies, Counters, Rushes And Build Orders For Ghosts In SC2 Starcraft 2 Hellion Guide - The Best Strategies, Counters, Rushes And Build Orders For Hellion In Sc2 Starcraft 2 Thor Guide - The Best Strategies, Counters, Rushes And Build Orders For Thor In SC2 Starcraft 2 Siege Tank Guide - The Best Strategies, Counters, Rushes And Build Orders For Siege Tanks In SC2