Informed traders : how they make their Judgment ?

IMO, It is not whether TA runs ahead or FA runs ahead. Generally Market is leading indicator of economy by 4 to 6 months. It is individuals belief that what works and what doesn't. It is their choice of the factor that they will use to take Trading Decisions. Most of the successful traders/ fund managers use both these approach. Probably you guys are missing 3rd approach of market analysis - "Quantitative Analysis" which is used by many Quant funds and hedge funds. I use all 3 approaches for my analysis but there is place for everything. TA / QA is used to time the market whereas FA is used to get the bigger picture. Generally the timeframe of FA based trader is too long.. And with long time frame, they can get big rewards, but the risk is also big (many of the funds are sitting at 50% drawdown now, so they need to make 100% to come back to pre-crash level. All the best to their fund managers.)

What u are calling as "they support the market", in my view they are timing the market bottom. They have done their analysis and found that it is time to enter now, because Reward to Risk ratio is favourable in their timeframe. It maynot be favourable in my timeframe.

They have the muscle power to employ the best brain, buy best of tools etc.. So it is fine with me. We small fish in the pond have to understand our limitation. And we also need to flow with them to survive and prosper. When we can't move the market then we need to align ourself with biggies. Important is to find out where the biggies are? what will be their action ? and when ?

Best part is, none of this can be hidden on chart. If we read it properly, then their footprint is available on the chart.
eg - did anybody notice that Quartly chart was in oversold zone in last month, which happened after many years ?

Absolutely right. Agree with you 1000% on this point.

Happy Trading.

AW10,
couldnt agree with you more on this... The fact that i learnt a few indicators in TA doesnt make me an expert. I found that out the hard way. Every time a trade went bad, i thought my system needed more refinement. I slapped more indicators, started reading about more complex theories until the whole trading setup became too complicated.

A friend of mine showed me how he traded and his success rate (ROI of 30-45% p.a.) blew my mind. He wanted me to teach him TA and i was wondering why would he want to complicate a nice system thats already paying him nice dividends. He looks for accumulation patterns and lays a lot of stress on volume. he uses the eod charts from indiabulls and thats all the TA he needs to know. He never carries a position without hedging. He researches a company's reaction to a news. Has a very clear perception about price actions. in short...a pure FA trader.

And i learnt from him the importance of OI and how thats interpreted. The importance of FII figures and a lot of other things. I dont know much about TA and i didnt bother showing him my ignorance but he gave me the much needed reality check.

TA does tend to be myopic and is just a small part in a successful trader's knowledge. That was the angle i was debating here on this thread. Nice of you to share your views here. I am honoured... I track your post regularly and find you a very reliable teacher. Hope to get a chance to pick your mind someday....

moral of the story

TA makes life complicated

A little TA with grip on funda is the best way to make life easier for an long term investor (lti). the funda community her seems fragmented.
except for 3 or 4 threads all threads are antique

A FA group always needs hunting in packs. people with little float like me can't make much a group can

an example is warren buffet and his group - disciples of graham. I am thinking in similar lines. Thinking of adding few of my offline with any of online friends here. preferably people with good fa and lti kind.......

so my friends gear up it's time for a change let's create a ripple in traderji with our fa.

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I may be a small drop but ocean is built with drops

Sorry to disappoint you Riser, I am still a TA trader with a new found respect for FA. I admire them, but i lack the patience needed. I'm relatively very new to trading and am trying to evaluate my own ability in becoming successful in this market. I am a fast learner and any help from your end will be highly appreciated. Thanks....

Sure, you will understand fast. Don't ask me what till you do.

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.
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Difference between TA and FA: (just expressing my view not enforcing)

TA is for traders and FA is for investors. Investors need to know "if" the stock can appreciate. Traders need to know "when" the stock can appreciate.

thats a valid point... indicators look beautiful on hindsight. Real time, confidence to act on the indicator comes from knowing the bigger picture, price movement structure.