5 Ways to Use a Stock Market Chat Room
A Stock Market Chat Room can be a great asset especially if they come equipped with profitable traders, live scanners and breaking news feeds. However, they can be your worst nightmare if you aren’t smart about how to properly use them. In fact, I feel 90% of day traders fail because they automatically assume that a chat room service will hold their hands and feed them as they trade. That style of thinking is a pure recipe for failure. On the flip side, there aren’t a lot of chat room moderators who constantly warn their subscribers of the traps of trading either. This duel symbiotic and dysfunctional relationship goes on so much to the point that I was compelled to write this post. So, if you are interested in joining a service but are confused about how to properly use one then bookmark this post because it will help guide you to do so the right way.
Warning – Before diving head first into stock trading you must be educated on certain topics of the stock market. You must know basic concepts, support and resistance, charting, risk management, strategy criteria, scanning and psychological control. These all get developed along your stock market journey but before testing out your strategies that you think will work for You, you should only paper trade the ideas before placing real money on the line or trade a few shares (25-50 shares) of real money until you build up a strong foundation for trading. One of the biggest traps is making money from a bad behavioral pattern or by mistake which will teach you to do the same bad behavior again and again.
Build Your Watch List
Stock market chat rooms are great for building watch lists but you MUST NOT FOLLOW someone’s trade alerts. As you are learning to trade you will be tempted to wait for your stock market guru to buy and sell so you can buy and sell after them. FIGHT THAT URGE! Let me say that again. FIGHT THAT URGE! You will lose. Rather than following someone into the trade, learn the reasons for their thought process and points of interest in the trade. I would find out what their buy points, exit points, scaling out points and bail out points are and why. Then study that. I would also find out or confirm what the resistance and support areas are so you can map out those points of interest on your chart as well. Then when you are ready to trade have a go at it with those points of reference to guide you but do not and I repeat DO NOT FOLLOW!
You can check out my daily watchlist.
Tip – If you are not sure what to do then don’t trade. There will be another trade waiting for you right around the corner.
Learn From Chat Members
Find 3 or 4 of the most consistently profitable traders in the stock market chat room of your choice and with care and ease try to pick their brains. Notice how I said the most consistently profitable and not most profitable. There is a huge difference. If you look for the heavy hitters of the chat room you better believe everyone and their mother is going to be up their asses asking them a ton of questions. Don’t add to their headache by asking the same 5000 questions they receive daily. Google, Bing and Yahoo can go a long way and won’t waste anyone’s time. Also, remember to find those who’s strategy you are trying to master so you can learn from that formula. Profits can come immediately but consistency takes time.
Tip – Kindness breeds kindness. Send those who help you often a thank you email or even a $5 gift card to their favorite coffee shop. 🙂
Avoid Those Who Distract
Knowing how to use a stock market chat room also means knowing who and what to avoid. If you find people constantly posting their gains you will focus on the money and fall into one of the 10 day trading distractions. Those distractions will inevitably hurt your building and learning journey. Money is such an emotional topic and day trading can be extremely emotional. If you add emotion to an already emotional business you could possibly make some very serious day trading mistakes. Also stay away from traders who trade too much, don’t have a clear strategy and those who post random thoughts. It’s ok to have friends in chat but you are building the business of You and not a social gathering.
Tip – Find those distractions in your trading journey and rid yourself of them immediately.
Ask The Moderators
Not long ago a chat member in the Warrior Trading chat room said to me they didn’t want to bother the moderators by asking them questions because they thought they were busy. On the contrary, ask ask ask. Then when you are done asking ask some more. A great stock market chat room is going to have moderators who answer your questions. If they don’t you should seriously reevaluate why you are there. Now on the flip side don’t be a lazy chat room subscriber like I discuss in this post. Before asking a question ask yourself can I Google this and get the answer myself. If it’s yes than don’t waste everyone’s time. Your ultimate goal is to be able to be fully independent so start by knowing when to ask and when to find it yourself.
Tip – Unless it’s an emergency, don’t ask questions 5 minutes before the market opens. In fact, wait until the market slows down before asking questions.
Find The Free Stuff
I found out about so many free tools like this one here from being in a stock market chat room. Finfiz, free charting websites and Think or Swim’s level 2 are just to name a few. Sometimes it’s tough to determine what is good and what is not but if you ask the moderators from my suggestion above you will filter out the free that could be more costly than you ever imagined. Also some moderators like Mike and Ed from Warrior Trading do watch list building and nightly recap videos that are absolutely 100% free. Use them.
Tip – Free for a limited time is a marketing ploy. Look for the free stuff that can help you cut costs and save money as you learn.
There are hundreds and maybe even thousands of stock market chat rooms in the world that it will be hard to decide which one to choose from. I highly suggest you take the free trial offer that most of them have and see if it’s a good fit for you. If they don’t have a free trial then sign up for a month and test out the waters with no long term commitment. Don’t be lured in by marketing ploys of “sign up now and save 50%”. Those sales never really end as they are strategies to get you to act quickly. Take your time and gather as much information as you can. You might find that you have to go through 1 stock market chat room after another before you find the one that fits your trading style and that is perfectly ok.
Some of the links in this post are from my sponsors. I thought you should know because honesty is better then sugarcoated bullsh*t.