We talk a lot about how important price matters in making consistent money. But it is equally important to be in stocks that are in play, that are moving.  Stock selection is crucial in making consistent money. I have been frustrated lately with many young traders on our trading floor over the past couple of weeks, because I feel that they are making this game tougher then it has to be by not being in stocks that are really in play. And let me make something very clear. This does not mean that you need to trade the flavor of the day every day or the stock with the most volume. Stocks can be in play for days on end. Stocks can be in play in the morning and not in play in the afternoon. They can be 2nd, 3rd, 4th and so on, day plays. They can skip a day and then be in play. I often feel that I make more money in a stocks that was in play on the second and third day. One reason for this is because I have gained invaluable knowledge. I know how the stock moves, I know the levels, I know how far the stock pullbacks. All this knowledge I have gained has given me an edge. As a professional trader I am always looking for an edge. This is where you make the easy money. I like to say stick with a stock and kick the sh** out of it until you stop making money. I will play the same stock everyday for months on end if it is in play and I am consistently making money in it.

How do you know if a stock is in play? A lot depends on your trading style and time frame. You need to know your favorite set ups, think about the plays where you have made the most money and look for those setups. Then when those setups start to occur, you want to see real buyers and sellers pushing these stocks in a certain direction. In addition, you would like to have an increase in volume. Then obviously, the next step is executing trades at the right price (Price Matters).

The key to all of this is to ask yourself good questions. This gets you involved and keeps you engaged in what is really occurring. What is the market doing? Is this stock affected by the market? Is the stock approaching any key levels? What direction is the stock heading? Is the stock trading choppy or is it trending? Who is winning: the buyers or sellers? What type of pullbacks is the stock having? All of these questions will help you identify stocks in play.

By being disciplined and waiting for your set-ups in stocks that are in play, you will be able to make consistent money.