My First AnalysisGAIL
- Thread starter Luckytrader
- Start date
Hi Saint,
As always you are very modest. Thanks a lot for your encouraging words. I hope to reach the high standards set by you, cv, amitbe (list is very lengthy) and other great senior members in this forum.
Thanks once again
With warm regards
R. S. Iyer
PS: By the way, what happened to Amitbe? On going through his old posts especially on NIFTY, I found that they were simply great. Why he is not posting here now?
As always you are very modest. Thanks a lot for your encouraging words. I hope to reach the high standards set by you, cv, amitbe (list is very lengthy) and other great senior members in this forum.
Thanks once again
With warm regards
R. S. Iyer
PS: By the way, what happened to Amitbe? On going through his old posts especially on NIFTY, I found that they were simply great. Why he is not posting here now?
Hi Asish,
I am not an experienced trader as you are. Basically, I am not a day trader also. So please do not misunderstand me. I am jotting down whatever I feel and whatever I believe to be right.
I do not know as to what Saint is trying to prove. But what I was stressing to Satya was that first he should get in to grips with price movements. That is the basic of technical analysis. He must develop his foundational level analysis by concentrating on price&volume charts. With this basic level knowledge he should be able to forecast or at least able to guess in which direction the prices are heading. Please note that I never said that he should stop with price&volume analysis. I always stressed that after getting grips with price&volume analysis, he can continue his studies with regard to all other aspects (such as indicators, oscillators, formula writing, backtesting etc. etc.). Why I feel it so essential is that without this there is every possibility of a trader being misled by some indicators or other. Once a trader is thorough with price & volume movements and he is able to guess future price movement on the basis of that, he can easily find out which indicator suits him and the present situation the best. Also he will not be misled by one technical indicator or the other. What I mean to say is that he will be able to read/modify the indicators in accordance with the direction of future trend in prices, which the price&volume analysis says. Take for example his method of trading on the basis of price pulling to 12 day EMA. The moment price began to trade in a range/ledge, he found out that he is getting wrong signals. If he were to concentrate on price&volume movements without concentrating on 12day EMA, then he would have found that prices are moving in a range and unless the price breaks out of this rage, his method will not work. Here his attention is distracted by 12 day EMA and its slope etc. Rather he should have concentrated on price to see whether it is trending or trading in a range. Further, we all know that moving averages tend to give false signals in a range. The same will be the situation with writing his own formula and thereafter backtesting with it also. The moment, situation changes, his formula will stop working or may not work as effectively as before and he will be wondering as what to do next. He may not be able to make those slight but niche modifications to it unless he knows the future direction of price movements and to modify the formula accordingly to forecast this correctly.
Another point which I feel he will turn out to be a winner if gets price&volume analysis analysis right is that he will not be groping in dark about which indicator(s) is to be used in trading in a particular situation. The biggest disadvantage to a learner/novice is the amount of distraction these indicators create. They always tend to bring second thoughts to the mind of a novice trader, which is not conducive for setting up a right trade.
First thing is to remove the bias which all these indicators create in our mind. It is the price and price alone that matters in the final analysis as to whether a trade is a winner or looser. That is why I went to the extent of suggesting even the removal of name of the company and y axis prices from the chart so that he should not have any bias in his mind of whatsoever nature.
I am not an experienced trader as you are. Basically, I am not a day trader also. So please do not misunderstand me. I am jotting down whatever I feel and whatever I believe to be right.
I do not know as to what Saint is trying to prove. But what I was stressing to Satya was that first he should get in to grips with price movements. That is the basic of technical analysis. He must develop his foundational level analysis by concentrating on price&volume charts. With this basic level knowledge he should be able to forecast or at least able to guess in which direction the prices are heading. Please note that I never said that he should stop with price&volume analysis. I always stressed that after getting grips with price&volume analysis, he can continue his studies with regard to all other aspects (such as indicators, oscillators, formula writing, backtesting etc. etc.). Why I feel it so essential is that without this there is every possibility of a trader being misled by some indicators or other. Once a trader is thorough with price & volume movements and he is able to guess future price movement on the basis of that, he can easily find out which indicator suits him and the present situation the best. Also he will not be misled by one technical indicator or the other. What I mean to say is that he will be able to read/modify the indicators in accordance with the direction of future trend in prices, which the price&volume analysis says. Take for example his method of trading on the basis of price pulling to 12 day EMA. The moment price began to trade in a range/ledge, he found out that he is getting wrong signals. If he were to concentrate on price&volume movements without concentrating on 12day EMA, then he would have found that prices are moving in a range and unless the price breaks out of this rage, his method will not work. Here his attention is distracted by 12 day EMA and its slope etc. Rather he should have concentrated on price to see whether it is trending or trading in a range. Further, we all know that moving averages tend to give false signals in a range. The same will be the situation with writing his own formula and thereafter backtesting with it also. The moment, situation changes, his formula will stop working or may not work as effectively as before and he will be wondering as what to do next. He may not be able to make those slight but niche modifications to it unless he knows the future direction of price movements and to modify the formula accordingly to forecast this correctly.
Another point which I feel he will turn out to be a winner if gets price&volume analysis analysis right is that he will not be groping in dark about which indicator(s) is to be used in trading in a particular situation. The biggest disadvantage to a learner/novice is the amount of distraction these indicators create. They always tend to bring second thoughts to the mind of a novice trader, which is not conducive for setting up a right trade.
First thing is to remove the bias which all these indicators create in our mind. It is the price and price alone that matters in the final analysis as to whether a trade is a winner or looser. That is why I went to the extent of suggesting even the removal of name of the company and y axis prices from the chart so that he should not have any bias in his mind of whatsoever nature.