Informed traders : how they make their Judgment ?

[Xaero]

Different strokes for different folks.

I know too that I can be done but what I know even better is that "I" can't do it. I find it easier to trade with less risk, less profit. When I am heavy on one counter it starts to bother me and keep thinking about it all day. So I trade only 10:30 - 3:00PM only nifty and only intraday (except for equities for investment).

To tell you the truth I used to think that TA was nonsense because if the news were bad then noone would give a damn about technicals. But after learning about how things work I saw that I would have been making huge profits if I had looked at the charts instead of the TV. It's important to find a strategy that suits you.

News can be useful, in fact I always keep CNBC running when trading. But don't act on news like I used to. Now I watch the charts and only listen to the news. It doesn't give you a hint about the general market mood. If you have noticed, even when the technicals point down if reliance,infy,LT etc come out with good results it changes the mood of the market. So while I don't directly act on it if I am looking to short the market I would pause for a little longer to check for any change in sentiment. Although many TA's say not to watch news when trading it does help in someways but what happened with me can be put in this way - Once Smitten, Twice Shy. One example was Satyam scandal - that day I was thinking of buying and thought that the prices had corrected enough and if not of the news I would have ended on the wrong side of the market.

 

[linkon7]

My objective is not to trade the news. I want to be able to see the accumulation pattern on the charts. co-relate information with price movement. That will come with experience, i guess. But i would derive a huge satisfaction if i could successfully do that.

 

[Xaero]

Yes that might work well because news make significant impact on the stock price. I am of the opinion that one much always be able aware of the mood in the market and everything else that effects the mood. But you'll find many here who will say that you only look at the chart and nothing else.

 

[linkon7]

Yes that might work well because news make significant impact on the stock price. I am of the opinion that one much always be able aware of the mood in the market and everything else that effects the mood. But you'll find many here who will say that you only look at the chart and nothing else.

when ever you hear big, really big players like rakesh jhunjunwala, speak, they hardly talk about technical. It cant be that they are above TA and have big money and hence force their way into some stocks and make it move the way he wants to. I am sure, Aptech is not the only investment he made and i am also more than sure that he more than doubled him money this fall.

They have a different mind set. they look at the market differently. 10 years back, if someone told me they were planning to sell water and that too at 10 Rs per litre, i would have laughed my guts out. The problem is vision. Developing that vision is tough but not impossible.

 

[sudoku1]

when ever you hear big, really big players like rakesh jhunjunwala, speak, they hardly talk about technical. It cant be that they are above TA and have big money and hence force their way into some stocks and make it move the way he wants to.

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if only money power was the force 2 reckon with ,the debris of large US banks & big hedge funds would not b out there

 

[Xaero]

when ever you hear big, really big players like rakesh jhunjunwala, speak, they hardly talk about technical. It cant be that they are above TA and have big money and hence force their way into some stocks and make it move the way he wants to. I am sure, Aptech is not the only investment he made and i am also more than sure that he more than doubled him money this fall.

They have a different mind set. they look at the market differently. 10 years back, if someone told me they were planning to sell water and that too at 10 Rs per litre, i would have laughed my guts out. The problem is vision. Developing that vision is tough but not impossible.

Money finally decides whether markets go up or down. Thats' true. If one person buying when hundred are selling can still take the markets up if the one person has more money then the other 100 but there rarely happens and as more people get into the market, retail, fii, hedge funds, traders, diis that money gets spread out and that's where technicals come into the picture. I don't think any technical trader would have made money but just looking at the technicals during the Harshad Meheta scandal.

Other things is that when more people start looking at technicals the money starts following the technicals so there nothing much we can say about what is going on except - Tum aam khao, pade kyon ginte ho?

Besides the balance of power is constantly shifting and people will move to wherever there are profits.. the list goes on and debating on how this happens, I don't think help.

I don't think we'll ever come to a conclusion.. if.. and IF anyone does then they can claim that they have found the key to eternal profits!

 

[sudoku1]

Money finally decides whether markets go up or down. Thats' true. If one person buying when hundred are selling can still take the markets up

mkts r the games based on demand supply mismatch which tranforms into sentiments....
sensex @ 21k..........there was so much money waitng 2 b invested......... but still the mkts fell under its own weight

 

[Xaero]

mkts r the games based on demand supply mismatch which tranforms into sentiments....
sensex @ 21k..........there was so much money waitng 2 b invested......... but still the mkts fell under its own weight

I may be wrong but I think the ones with the money waiting to invest at 21k kept waiting and the who who were waiting to book profits took the markets down.

 

[NOMINDTR]

This is exactly what i dont like. when someone see's someone making a mistake and simply pulls a chair & pop corn and watches the show, instead of lending a voice or a hint. come on...I dont want to make every mistake there is to better myself. I am in a ring with mike tyson here and u are waiting to see me how bad my face will look without the teeth.
==>

You misunderstood friend.

I just mentioned every one of us understand market and art of trading by searching this and that, going here and there...one day we find the journey ends up with trading with no huge effort. Ambitious day for every trader. I just wanted to mention that. I hope you understand what I meant by "don't ask me what" as it could not be explained.

I guess I have to take little more care. Don't know why these days I have become economical when writing posts.

 

[AW10]

Different strokes for different folks.
News can be useful, in fact I always keep CNBC running when trading. But don't act on news like I used to. Now I watch the charts and only listen to the news. It doesn't give you a hint about the general market mood. If you have noticed, even when the technicals point down if reliance,infy,LT etc come out with good results it changes the mood of the market. So while I don't directly act on it if I am looking to short the market I would pause for a little longer to check for any change in sentiment. Although many TA's say not to watch news when trading it does help in someways but what happened with me can be put in this way - Once Smitten, Twice Shy. One example was Satyam scandal - that day I was thinking of buying and thought that the prices had corrected enough and if not of the news I would have ended on the wrong side of the market.

IMO, news only accelerates the price action.. towards the support or resistance zone. (remember the TIME dimension of price behaviour). But finally the market structure helps us in identifying the next price action. We see it often that gap down is bought back by professionals.. and gap ups are sold by the professionals. Similarly, price drops after so called +ive news and rallies after a -ive news. (ofcourse nothing is 100% correct in the market so always there is probability factor attached to it and thats when our stops help us to safegaurd our capital).

Media has nothing to loose and they are doing their job of feeding us the info. It is we who decide to trade that news.

My belief, Market price discounts everything (including fundamental picture of economy which is few months away). If price is in the resistance zone then it is setup to go short. Resistance zone is certainly not a place to buy.

Happy Trading.