Very few people play fantasy baseball for life-changing amounts of money. If you're one of them, please disregard this and all other advice I offer. I don't want it on my conscious.
Because fantasy baseball is primarily an entertainment, I dispute the popular punditry which argues that you should aspire to objectivity at your draft or auction. Sure, you're decreasing your chance of winning your league if you choose to load up on your hometown Royals, but, within reason, you should target players that you enjoy watching. An entire season of Nick Swisher at-bats generally yields some nice stats, but I, personally, find his plate appearances less than riveting. I look forward to Carlos Zambrano starts, but, though I realize he's an equally competent pitcher in many respects, I don't feel the same way about Cole Hamels.
When it comes to players who have equal amounts of potential and implicit risks, like Hamels and Zambrano, your instinct is as good a determining factor as anything. In a standard $260 auction, Hamels and Big Z should probably both go for $15-$20. If I see Hamels stagnating on the lower end of that range or below (something which is unlikely to happen due to his notoriety), I would probably jump on him as a value pick, but I'm not going to pay full price, whereas I might go into the high teens for Zambrano (though, luckily, it's doubtful I'd have to, at least this year).
My point is, there are essentially two types of bids in an auction. There are bids you make on players you desperately want, players you're willing to pay top dollar for, and there are bids you make because you think the players is being undervalued by your competitors and you like the reduced rate. If you're going to have a good auction, you're going to need to do a little of both.
Depending on the size of your league, your roster, and your budget, you should probably target somewhere between eight and a dozen players. Keep in mind, not all of them should be "premium" guys. You're not going to follow more than a couple guys into the $30 range, maybe a couple more into the mid-to-upper twenties. You should also have a variety of "sleepers" at various prices, guys you have high hopes for who you think can be had for $15, $10, $5, or even $1.
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