You’re finally ready to trade. Your brokerage account is open and funded. Now it’s time for the real work: watching the markets and finding trades.
This is your opportunity to be a savvy trader and learn to put stock trading software like StocksToTrade (check out the 7-day, $7 trial) to good use. A great stock trading platform can make your trading day easier, helping you analyze stocks, enter trades, stay current with news, and more.
If you’re going to use a trading platform, do yourself a big favor and learn to do it right. Want some tips on how to best use your platform? We’ve got you covered. Here’s your guide to getting started.
What Is Online Stock Trading Software
Before we go any further, let’s be clear on what trading software is. Think of it as your command center as you go into daily battle in the market. Your trading software platform is your helm, where you make all your tactical decisions.
First, your trading software helps you find and research stocks and potential trades. Once you spot the trades you’re ready to pursue, you can then use the platform to set your entry and exit points.
You can execute your trade — enter and exit stocks — all with just a few clicks.
A good trading platform offers easy-to-read charts, news stories, powerful scanning options, and other top tools to help you stay nimble in the market.
Do you really need software? Let’s put it this way: Even the super-pro traders wouldn’t dream of trading without a solid platform. It’s that vital.
Ways to Trade Stocks Online
There are two ways to trade stocks online: the amateur way and the professional way.
If you go the amateur route, here’s what your days might look like …
You’ll log into your broker account through an internet browser, then click through a clunky website to find a stock price.
Big heads up here: The stock price on your broker website can be delayed by about 20 minutes.
And when it comes to trading, timing is everything. Also, you won’t have access to charts. And you won’t have up-to-date information or news on the stock.
You’re basically buying the stock on a hunch. And there’s a good chance that during the trading day you’ll see it go absolutely nowhere. Meanwhile, you’ll probably hear about some massive gainers that are up 20 or 30% on the day.
If you have no process to find the action or even what’s going on in the markets, you’re definitely an amateur — and your trading capital will ultimately take the hit.
Now let’s take a look at what it looks like to trade like a professional.
As a pro trader, you log into your state-of-the-art trading platform and scan for optimal trading setups. From there, you build a watchlist of your favorite stocks. Bam! You’re ready for the trading day.
Once the market opens, your trading platform alerts you to a news story on one of your watchlist stocks. You quickly assess the price action and see a great trade setup, and with a few clicks, you’re in the stock.
Let’s take this scenario a little further. Maybe you even make the gains you projected in your trading plan. Now that’s a killer trading day.
Here’s the thing: When you treat trading like a profession and use professional tools, you’re better equipped to find the market action. Sounds better than taking the amateur approach, right?
Stock Market Hours
When and where do traders find most of the stock market action?
If you’re located in the U.S., it’s during the daytime. The majority of stock trading in the U.S. happens on two exchanges: the Nasdaq and the New York Stock Exchange (NYSE). Both exchanges operate year-round, Monday through Friday (except U.S. holidays), with regular daily trading sessions between 9:30 a.m. and 4 p.m.
The daily session is where most traders focus. That’s where you’ll find the most volume.
Outside of these hours, you can still place trades in pre-market and after-hours sessions. Trading in these sessions can give you the opportunity to act in the event that a stock’s price will likely move the next day, due to the evening news, for example.
But be warned! Trading outside of regular market hours can be tricky. There’s generally far less liquidity, which can mean that it may harder to get a trade filled without knocking the price around. Make sure you know what you’re doing before you venture into the after-hours arena.
5 Ways to Use Stock Trading Software
Now we’re getting into the fun part: How to use your trading platform to find and monitor stocks every day.
Love a list? So do we. Here are five powerful ways to leverage trading software. Use these tips to bolster your trading skills and streamline your trading day. Let’s get to it!
#1 Use Scans and Charts
There are tons of stocks traded every day in the U.S. Your first goal: to locate the candidates that best fit your trading strategy.
Most active traders base their analysis process on stock price charts, searching for their favorite patterns. These patterns can give insight into how a stock might move in the near future. It helps you set your entry point, exit point, and stop-loss.
Once you’re comfortable analyzing charts, it’s time to use your platform’s stock scanner tool, which helps you find trade opportunities. You simply enter your trading criteria and — boom! — the scanner returns a list of stocks that fit your criteria or setup.
Let’s take a closer look at how to use scanners.
How to Use Stock Trading Scanners
A well-designed stock scanner can help you reduce your analysis time in a big way. It’s a fantastic tool for traders of all experience levels. Unless you’re into making things unnecessarily hard on yourself, use a scanner.
A good scanner allows you to quickly search for a variety of criteria: your favorite chart patterns, large percent moves, high-impact news stories, and much more.
After setting your criteria, your scanner returns a list of high-potential stocks. The next step is to dive deep into those stocks and research them thoroughly. Then, pick your favorite candidates (start with a few) to watch closely once the market opens.
The StocksToTrade scanner showing biggest percentage gainers $20 and under. (Source:StocksToTrade.com)
How to Use Stock Trading Charts
Rule #1: Never underestimate the power of stock charts!
We recommend that you keep your charting process simple. Many top traders often look for super basic patterns and price action.
What do we mean by basic patterns? We’re talking about simple support and resistance, swing-highs and swing-lows, and clear trends. You can maybe even go a tad fancier, with a head-and-shoulders pattern, for example.
It’s important to put in the time to find your favorite chart setups. Then study as many charts as you can, looking for those patterns. Analyze and study the patterns until they’re second nature.
Your goal is to be a master of a few setups, not a novice in hundreds of different setups.
#2 Monitor the Action
OK, your pre-market analysis is complete. You’re ready to focus on a handful of promising stocks thanks to your scanner and charting platform …
Now it’s time to watch the market action in real time.
Word to the wise: Once the market opens, things can move at a rapid and hectic pace. Be prepared.
Here are two powerful ways to use your trading platform throughout the day …
Keep an Eye on News
When a stock makes a sudden move, it’s likely due to new information or what’s called a news catalyst. That catalyst can be a company announcement, an interview with the CEO, new government regulations, or economic news.
This is exactly why you need to stay on the news alert. Sudden moves can lead to trading opportunities, or they can tank what was a promising trade.
Opt for trading software with a news scanner to track stories related to the stocks on your watchlist. The StocksToTrade platform makes scanning for news a breeze. Try a 7-day trial for just $7.
Use Streaming Data
When you get stock price quotes for free, you’re often getting delayed data. And there’s no guarantee that the price won’t move in that 20-minute lag. For a longer-term trader, that lag may not make much of a difference …
But if you’re day trading, you need to know where the price is at all times. That means you need access to streaming data. Streaming data is just a term for current, up-to-the-second price quotes.
Knowing where the true price is at all times allows you to enter and exit trades the second you see your setup. Without a live price, you can miss a trade.
No one wants to miss out on trades. Choose a trading platform that includes streaming data before you place your first trade.
#3 Participate in Stock Trading Software Chats
Trading can be a lonely endeavor … sitting at a computer all day, watching tickers, and wading through the emotional highs and lows.
It may feel lonely, but it doesn’t have to be that way!
Join a trading chat room to discuss and share information with traders who know and live this same experience every day.
There’s no shortage of chat rooms, so it’s important to find one with serious traders who trade similar stocks and strategies as you. For instance, if you’re trading penny stocks, veteran trader and teacher Tim Sykes runs a chat room that might feel like home to you.
A well-rounded chat room should be part education and part support network. Find one with the right fit for your trading style to help make your trading journey more educational and enjoyable and far less lonely.
#4 Attend Stock Trading Webinars
Great traders constantly work at developing their trading skills.
A great way to get up-to-date training on what’s working right now is by attending trading webinars.
Trading webinars are online seminar-style training events, where an instructor provides lessons and offers discussions on a range of trading topics.
With StocksToTrade Pro, lead trainer Tim Bohen offers real-time guidance to the STT Pro community with twice daily training webinars. Participants can ask him questions, see what’s on his trading agenda, and learn how he adapts his trading strategies to current market conditions. It’s like working in an office with a veteran trader!
STT Pro members can also attend weekly structured training sessions for the latest and greatest strategy secrets.
If you’re looking for high-level interaction and support from a veteran trader, check out StocksToTrade Pro.
#5 Use Paper Trading Software
Maybe you want to trade, but you’re not quite confident in your trading strategy yet. Good news: You can still gain real-time experience by paper trading.
Paper trading is where you go through all the motions of trading, without risking any capital. It’s a great way to test out and evaluate your trading research and strategies. You make the exact same buying and selling decisions and record everything that happens, but you don’t actually make the trade.
Once you feel comfortable with your paper trading experience (and record), start the transition to making live trades.
How to Use Stock Trading Simulators
Here’s the thing with paper trading: You want it to feel like you’re really trading. That way, when you start trading live, your trading actions and decisions will feel familiar.
You need to experience the entire process of paper trading several times. Once you have a decent sample of paper trades, maybe 20 or more, the next step is to analyze your trades.
Look for trends that result in losing trades, and look for trends that resulted in wins, even if they were small. Your goal is to maximize your strengths and cut your losses. Take what you learn and build it into your strategy. Paper trading is all about developing your skills, refining your strategy, and getting better.
Now, it may be called paper trading, but that doesn’t mean you have to do it on paper …
The StocksToTrade platform includes paper trading capabilities. You click the exact same “buy” and “sell” buttons and look at the same charts and tickers as if you were trading live. Grab a 7-day trial today!
Using a scanner is the first step in having the computer do the heavy lifting for you. If you’re ready to ramp it up and use more computing power, check out algorithmic trading.
Algorithmic trading involves inputting your entire trading strategy into your trading platform — your entry, exit, and trade-management criteria.
It’s basically breaking down your strategy into a mathematical equation so that the software can understand it. That may sound complicated, but it’s not that hard.
On the StocksToTrade platform, we offer members the use of our Oracle algorithm.
Oracle is a sophisticated algorithm that we developed through heavy and thorough research of our favorite trade setups.
Oracle displays potential long and short trading opportunities in real time, giving our members key levels at which to find trades. This is a powerful tool for any trader who’s short on time but wants to be active in the markets.
See how you can harness high-tech trading prowess of Oracle — check out a trial now.
Take Advantage of StocksToTrade Features
Yes, the markets are highly competitive, but that doesn’t mean there aren’t opportunities for traders of all experience levels. Keep up with the competition: Use great technology like StocksToTrade.
Here’s a small sample of the robust features you’ll find:
- Highly customizable charting features for a clean, elegant view of market action.
- A massive and growing library of technical indicators.
- Real-time scanning abilities to track market hype — news stories, SEC filings, Twitter, and more.
- The ability to view nearly every stock traded in the U.S., including pink sheets and OTC markets.
- And many more premium features to help you create strong trading plans and find the best potential stocks to trade.
All of these features come in a simple, easy-to-use package to help make your trading day stress-free and streamlined.
Check out the platform now to see just how enjoyable your trading day can be!
Using trading software intelligently is one of the most fundamental and straightforward steps on your trading trek.
There are seemingly endless functions you can run on a trading platform — it can be overwhelming for the newbie trader. But stick with it and give it time. Follow the steps in this post until you feel comfortable with every aspect of the software and trading.
If you ever find yourself stuck in a trading rut, go back to the basics. Come back to this article and walk through the steps. Practice, practice, practice. Never stop learning.
Now it’s time to load up that platform and make it happen!
If you don’t have a platform yet, we invite you to check out StocksToTrade now. Grab a 7-day trial for $7 to see how easy the trading process can be!