The trading world is epitomized by open outcry on the exchange floor. Traders learn to recognize the different levels of sound to get a read on market direction and intensity. So, too, the cavernous trading desks run by large hedge funds and global investment banks give their traders a real-time temperature reading on what’s hot and what’s not. It is these real-time market and individual stock temperature reads that traders get from Twitter’s broadcast system, which, in many ways, replicates the trading room experience.

Keep reading to get five ways Twitter can help you to become a better trader.

#1 – Track the Market in Real Time

Like I said, Twitter offers a real-time read on the market. You can watch the herd move in one direction just like the trading pit (minus the shouting), and trade with or against them. Below are two different ways to get a pulse on the trading community when using Twitter:

StockTwits aggregates real-time tweets. When Twitter users tag stock tickers with the $ symbol or market-related comments with $$, those tweets get fed into StockTwits. You can then stream the tweets by specific filters. Personally, I stream by recommended StockTwits to get a pulse on what traders are talking about. Watch an introduction to StockTwits.

TweetDeck is a desktop application that helps you manage Twitter more efficiently while making your Twitter experience more robust. I use TweetDeck to stream the stock tickers I’m trading on a given day. Note that you have to use the $ symbol in order to filter out non-stock-related chatter, e.g., $UNG, $AAPL, $ORCL. See a tutorial on TweetDeck.

#2 – See Which Stocks are Hot

Whether its earnings, breaking news or some unusual options activity, Twitter allows you to identify the stocks with the most buzz. Keeping your finger on the pulse of the market has never been easier, as you can easily track the buzz surrounding the hottest stocks on StockTwits and TweetDeck.

For example, StockTwits shows the most tweeted tickers by time frame (day, week, month). The numbers next to the ticker indicates the number of tweets. You can also see the top gainers and losers based on the number of tweets in the selected time frame.

#3 – Network With Other Traders

Twitter gives you great exposure to other traders. Most traders are alone in front of a computer screen — cut off from the actions
of other traders. Seeing streaming trades, commentary, technical analysis, etc., on the stocks you are following adds a new dimension to trading.

What’s more, using Twitter to get immediate feedback from other traders can keep you from making that bad trade that ruins your week. The trick is to find the right people to follow and stream their tweets in TweetDeck. You can even select specific individuals to stream in a custom group. This allows you to filter out any unnecessary chatter and focus on the traders you want to network with.

#4 – Get Actionable Insights and Alerts

Traders often share actionable information in the form of informative articles and blog posts, technical analysis on specific stocks, entry and exit prices on their trades, and general commentary on the stock market.

#5 – Get Trading Ideas

The chatter on Twitter is superfluous and sometimes overwhelming. With the combination of StockTwits and TweetDeck, you now can filter out the noise and get the trading ideas you’re looking for. Take Novavax (NASDAQ: NVAX), for example, which shot up more than 30% on June 30, on news that the Spanish government selected the company to license its genetically engineered technology to produce pandemic and seasonal flu vaccines. Twitter users were quick to tweet about NVAX following the news, and had you been following them, you may have found some very profitable trading ideas.

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