The most important thing you want to do is take trades that have a positive Risk to Reward. This means your risk (stop loss) shouldn't be more than your reward (target). You shouldn't play breakouts with smaller accounts and instead focus on
Getting trades with clear defined risk. Supply and Demand techniques are one to look into.
This is one of the most important techniques in trading/investing so do make sure to study it well.
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1. What is Supply & Demand?
Supply & Demand is a way to determine where there is strong buying/selling.
Supply & Demand's show imbalances in trades and illustrate where we can expect to see another bounce or sell off from previous action.
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It is pretty similar to a support and resistance level in that you are playing areas of buying/selling, but it includes a stronger sense of the moves and includes a wider range.
Here is a fairly simple way to understand Supply & Demand :
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1. What is an option?
An option contract is an agreement that gives the option holder the right to buy or sell the underlying asset at a certain date. Instead of buying the actual shares of a stock, you are buying a contract of 100 shares. This basically means that options
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contracts are just leveraged shares. For example, If I bought SPY shares @ $441 and they went up to $443 I would have made roughly 0.45% profit on my money. However, depending on the options contract I got it could have been anywhere from 50%-200% profit.
This is everything you will need to start as a new trader.
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Candlesticks
A candlestick shows the action between buyers and sellers. There are different types of candles that can help us best understand who is in control and predict the future trend. Here are just a few of the candlesticks :
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Support and Resistance
Support and Resistance are levels which show us where buyers and sellers will be looking to buy/sell depending on previous price action.
This chart shows a support level where we saw the stock bounce previously. We also see a resistance level