How To Choose A Daytrading Market

by Manny Backus, Day Trading Strategy Expert

Almost all platforms interact with the best price.  Whether it is the NYSE, ARCA, NASDAQ, AMEX, or Dow Jones Index; most day traders have a tendency to work within each of these branches and develop an affinity for certain stocks and sectors.  They read and gain expertise in that field in order to learn what makes those stocks move.
In addition to the aforementioned day trading markets there is the Forex market which deals exclusively with currency.  Day traders choose different markets based on their experience, personality, the manner in which they trade, and the trading system used.

Pick up any newspaper or periodical such as Barron’s and you will find all the latest information on day trading markets and the stocks within each market.  Barron’s also has an online site which has daily stats as seen on this graphic:

As you can see from the above chart, the first item is the Dow Jones Industrial Average.  The Dow Jones Industrial Average Index is an average amount of actively traded blue chip stocks, which are mostly industrials.  It is the most widely recognized component showing the closing stock prices on a given day as well as the second number which signifies how much the stocks rose in general.  If the stocks had taken a bit of a tumble, the 119.01 in the chart would be listed in red.

NASDAQ is well known for its penny stocks or more commonly referred to as over-the-counter stocks.  These stocks incorporate the following sectors: technology, housing, financials, health, transportation, and so on.

ARCA or Exchange Traded Fund refers to those stocks which can be bought or sold throughout a day, thus day traders may use the ARCA Tech 100 ETF.  The buying or selling, the price of stocks will fluctuate during the day and will denote the changing prices of the index as well as taking into account any brokerage charges that may be incurred for placing the trade.

The New York Stock Exchange or NYSE is housed in New York.  It is the home of the big board where literally thousands of companies are listed on this exchange.

The American Stock Exchange or AMEX is the second largest exchange in the United States.  Amex has been on the leading edge of exchanges worldwide, especially in technology as it relates to the trading floor.

Another day trading market is known as the Index. This is a market indicator, akin to NASDAQ or Dow Jones, and represents a measure of a combined group of stocks.

So too, the graph above shows S&P 500.  S&P or Standard & Poor is a well known company which rates stocks and bonds in order of their investment risk.  They assess industrial stocks, transportation stocks, financial stocks, and public utilities (the total of all adds up to 500 stocks) as an indicator of changes in the market.

In addition, you will notice on the graph Barron’s 400 stock prices at the close of a particular day as well.  These are Barron’s company index which lists all of the companies they have written about in their magazine as well as online.  You can easily check the companies on their site as well.

Therefore, day traders have at their disposal many day trading markets and may utilize one or all when conducting transactions.  It all depends on their preference, how long they have been following certain sectors of a stock, and their experience and knowledge of the company or companies involved.

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