Day Trading Penny Stock Tips

Day trading can be just as fun as going to the horse track, and it can be just as costly or just as profitable. Like at the track, people have their own rituals when it comes to making picks.

Set Up Your Environment

Yahoo Finance has effective portfolio management tools that are available for free. You can set alerts and do research. Big Charts has the best free market charting software online. In the next section, you'll see how pivotal the charts are in day trading. TD Ameritrade can be used for trade execution as well as research.

The Charts and Execution

Day trading is a risk, but start out by looking for volatile stocks. The ones that are high today, low tomorrow, high the next day and low the next day are worth tracking. You want to buy low, set your alerts in Yahoo and wait. As soon as you get an alert that your stock has risen, jump into TD Ameritrade and sell. You can also set up TD Ameritrade to sell at certain numbers automatically.

Conclusion

It's not a fool-proof plan, but the good thing about trading in penny stocks is that you tend to only throw pennies at them. At any given time, I never have more than $1,000 floating around in penny stocks waiting for something to hit. I've had some big gains using this strategy and it's fun. I prefer it over the race track any day.