Before we can sum up what tax loss selling means lets first clear up some facts about taxes relating to stock trading particularly.

Whether you close your stock position at a gain or loss it has an effect on your yearly tax returns. Obviously the quicker you make money, the higher taxes are. This is commonly referred to as short-term capital gains tax.

There are a couple varying terms, but on average a gain is considered short-term if it was made in less than 6 months to a year.

Just like businesses can write-off expenses or losses, so can individual traders. Using this method many traders use their losses to offset taxes for any gains. While the country files there tax returns in August, capital gains are calculated through the previous December 31, which is why you may see unnormal or unwarranted selling around November and December.

Sell your losers and take your losses now – that is tax-loss selling in a nutshell.

A good way to capitalize on tax loss selling is by shorting stocks; however, it can be risky. Although you shouldn’t put too much emphasis on tax loss selling when considering to take part of a stock, there are a couple factors you can look for when searching for companies that could fall victim to tax-loss selling.

1. Look for stocks that traded well above their current price for much of the year. Check out the daily volume and see if the high-price period corresponds with high volume too. That means a lot of folks bought the stock at much higher prices than now. They may sell it for the tax loss before December 31.

2. Look for companies with large floats, i.e. a lot of shares available for the public to trade. This is a good rule for short-selling in general. Stocks with small floats (less than 5 million shares) can be hard to borrow and short to begin with. If they are already heavily shorted, the chances are greater you could get caught in a “squeeze” as the price runs up and shorts are forced to cover at desperation prices.

Using the above factors along with other criteria you would normally look for when finding shorting candidates, hopefully next year you can take advantage of tax loss selling rather than just taking part in it.

Learn more tax tricks and tips for stock traders.

According to Morningstar, investing in commodities has seen the best results when the investor is limited and diversified. Specifically among energy, agricultural, and industrial and precious metals.

While you could physically buy gold bars or barrels of oil and keep them in your garage, this is not a practical solution. You have to worry about insurance and storage, and some soft commodities like corn aren’t going to hold up too well over the years. For many decades, these barriers prevented the average trader from investing in commodities, but now exchange-traded funds have now made it possible for individuals to gain direct exposure.

Morningstar has an interesting ETF scanner that will help you find ETFs for various classes of commodities. For example, if you were looking for gold exposure, then, using the screener, you would find the ETF, SPDR Gold Shares GLD, which buys gold bars for every share issued, and then store them in vaults in London.

ETF Screener

Here is a list of some of the more popular commodity ETFs.

• PowerShares DB Oil (DBO)
• U.S. Oil (USO)
• iShares Silver Trust (SLV)
• iPath Dow Jones AIG Commodity Index (DJP)
• PowerShares DB Agriculture Fund (DBA)
• PowerShares DB Energy Fund (DBE)

Essentially using an ETF screener such as the one at Morningstar will not only allow exposure to commodities, but also the ability to properly invest in it without having to actually store a tangible item.

See Idiot’s Guide To Option Trading.

Believe it or not, many of the most commonly used trading and analysis tools were created far before the current markets as we know were even created, such as the Fibonacci retracement.

In the options market, the Greeks define and quantify the risks of your position before you commit to the investment. Understanding the Greeks is a must for proper risk management. Further, the Greeks can also help you identify and select not only the proper strategy to fit the opportunity you selected, but also which specific options to use to create that specific strategy.

Ron Ianieri does a good job of covering this “Greek” idea in one of his seminars, DIW Ron Greeks. You can view this video as part of the free INO TV Account.

Below is a list of dates when the U.S Stock Exchanges are closed.

1. News Year’s Day
2. Martin Luther King Jr. Day
3. President’s Day”Good Friday
4. Memorial Day
5. Independence Day
6. Labor Day
7. Thanksgiving Day
8. Day after Thanksgiving*
9. Christmas**

*Market closes at 1:00 PM EST.
**Market closes at 1:00 PM EST on Dec. 24

Some holiday notes and reminders.

1. If a holiday falls on Saturday, then the market is closed the proceeding Friday.
2. If a holiday falls on Sunday, then the market is closed the following Monday.

If there is a resource that allows us to eliminate a hours worth of work, then imagine what you can make up in that new hour. The same case goes for holding a stock.

I always preach that you should allow your stock room to breath. Rarely will anybody call the exact bottom or exact top. That being said, there are some warning signs that should tip you off it is time to sell.

1. Bad News

Regardless of how much research and risk management you use, the inevitable will always happen. Maybe some type of natural disaster , company being sued, or threat. Whatever it may be, certain news affects certain stocks. If pertinent bad news break, then its probably a good sign to sell.

2. Large Volume

If technical analysis is your thing, then you’re probably aware of the importance of volume compared to the move in stock price. If there is heavy volume on a swing downwards, then its probably a good sign to sell.

3. Doesn’t Follow Plan

You should always have a plan before entering a stock. Where to buy and take profits; however, sometimes these plans don’t play out like they were supposed to. For example, if you bought a stock that is supposed to rise as oil goes up and oil goes up but stock doesn’t, then you might want to consider selling.

While these are very simple methods and ideas, they can easily help you prevent losing more than anybody wants to.

Wall Street has gone out of it’s way to make it easy to buy stocks but at the same time convince you that the market is way too sophisticated for the average investor. They promote the professionals while promoting a buy and hold strategy.

I think the main reason that they recommend buying and holding your stocks is because they don’t know when to sell. Since they don’t know when to sell, they promote never selling. What an easy out. The time to buy is always right now and the time to sell is long term.

If you really want to make money buying stocks you can’t adopt that philosophy. You’ve got to study the stocks to buy and look for two distinct prices — the price you are going to buy at and the price you are going to sell at. Doing that is easier than you think but it’s an art not a science. What that means is that the skill doesn’t come without practice.

To do this, you need one important tool and that’s a stock chart that shows the price and volume action for the stock over period of time. What you are looking for is identifying when the stock is being bought by institutional investors which are the driving force behind pushing a stocks price higher. You do that by noticing when a stocks price is closing higher on higher than average volume. How can you tell when to sell, by looking at the exact opposite. When a stock price closes lower on higher volume, that’s your cue to exit the stock. By observing these clues to who is buying the stock, with practice you can pick when to buy and sell stocks like a professional.

1. Keep entry, exit, and stop prices intact before starting trade.

2. Don’t try to catch trades. If stock doesn’t meet criteria, then move on.

3. Don’t buy when a stock is at the peak of its run.

4. Wait for some form of price confirmation before taking action, by using technical analysis.

5. When it seems like everybody is excited about a stock… sell.

6. Don’t fall in love with stocks. Never partake in emotional trading.

7. Take profit when you can. Scale out if needed, but don’t risk losing profit.

8. Don’t commit stock chart fraud. Pick an analysis method and stick with it.

Are there any other simplified techniques to instantly cut down on any potential market losses?

How does one know when to sell?

Obviously, depending on your individual strategy and desired profit margin, each answer will be somewhat different. That being said, there are a few guidelines to help you determine when exactly you should be looking to take your profit and run.

1. You stock hits its initial exit target. Basically the most simplest and basic answer. There are 3 targets that should be created before you buy a stock: buy, sell, and stop. Once your target is met, execute the proper action.

2. Your stock is gaining popularity. Just like real estate and any bubble, the more people that enter, the more likely the value of that entity is about to come crashing down. Once you start to feel that more and more buyers are coming than sellers, consider dropping your position. Some people use the level I or level II function of their trading platform; however, just monitoring news and social buzz should be good enough.

3. Wait till the current momentum tops out. Rarely can anybody ever call an exact bottom or top; however, we can usually get close to calling the top or bottom of a mini rally or current momentum. If you are looking to exit your stock, then try to wait until the current mini-momentum is over. This can easily be done by incrementally moving your stop price up until the actual price and stop price meet.

When it comes to selling there is no exact science or simple rule on when to do it. The best thing you can do is trust yourself, and take profit when you can.

To actually perform the stock trades you will need either a capable phone or wireless device (i.e. Blackberry, iPhone) or quick access to computer to check price and execute orders.

To be able to trade almost anywhere, a smart phone would be desirable. Popular stock brokerages such as E*Trade, thinkorswim, and TD Ameritrade offer applications for the Blackberry and iPhone, which allow you to access your account from directly through your phone. Obviously, these applications makes having an account with these brokerages more desirable. That being said, if you can’t or don’t want to open an account with them and your current brokerage does not offer some type of smart phone application, then you will have to live with the ability to need quick access to a computer.

Next we need some way of checking stock prices. Once again, if you don’t have a smart phone, then you will need access to a computer to quickly check current prices. Later in this article we will be looking at how to minimize your monitoring, so you do not have to constantly use the computer. On the other hand, if you have a smart phone then you are in luck. Check out a complete list of recommended mobile stock trading applications for the iPhone. Many of them also have a version for the Blackberry.

Okay, so now that we got all the equipment out of the way it is time to start planning our stock trading process. Remember that since we are not stationed at a computer, we need to make each check-up more efficient. That is where the pre-planning comes in.

If you are following a stock that looks ready to buy or sell, then you need to create your price targets: entry, stop, exit. These are specific prices for where you want to execute some action. By knowing these prices ahead of time, we are able to quickly check a price of a certain stock and take necessary action. I use simple technical analysis indicators and patterns to predict price movement.

Another way to make your stock trading more efficient is to use other types of stock market orders.

The whole idea of trading on the go is to be able to effectively make money from wherever you are. It really is a powerful feeling. As technology has evolved, no longer are limited by location-constraints to where we can trade. As long as we do our proper preparations and efficiently track our stocks’ statuses, then all traders should be able to make money in the stock market from anywhere.

Check out a full list of online discount stock brokerages that offer mobile trading apps.

Well we’re going to explore this here in just a minute. Lets look at one technique and go over some examples of how these markets behave in those settings.

Before I can talk to you too much about the first example. we need to define a few things for you. First candles… the approach that I use with Japanese candle charts, and that is what you’re looking at here, is not the standard approach. So from my perspective, I don’t focus on patterns, I focus on behavior. If we see a green candle that represents buying, that means that the closing price is higher than the open. If you see a red box that represents selling it means that the closing price is below that opening price. If you see a white line on top that’s called a shadow, I think that represents selling. If you see a white line on the bottom that represents buying. Now with that in mind, the sizes of the bodies and the shadows tell us about the degree of buying or selling.

Now let’s talk about this set-up here…

To get the rest of the tips, please check this video out.