Teach A Man To Fish And.........

jamit_05 · #**1321** 24th March 2008, 05:06 PM

Quote:

Originally Posted by Saint

Hi Amit,

then sit it out.......Have a good time with your family,enjoy,go for a vacation........but get your cash ready,and once charts signal a resumption of an uptrend,then you are back in business.

All the best!
Saint

Yes, that is good suggestion... anytime is a good time for a vacation

However, the downward trend or the sideways one can go on for months, if not years. What does one do then? Specially this downtrend looks like will be an extended one.

What would you suggest?

Amit. Jain

Saint · #**1322** 24th March 2008, 05:39 PM

Quote:

Originally Posted by jamit_05

Yes, that is good suggestion... anytime is a good time for a vacation

However, the downward trend or the sideways one can go on for months, if not years. What does one do then? Specially this downtrend looks like will be an extended one.

What would you suggest?

Amit. Jain

Bring your time frame that you trade to shorter term ...... if truly a primary dntrend starts,you could still make money in the short term up moves.Or you could learn how to short using futures.

But in a primary dntrend,forget all the buys and holds that may have worked for you in the last 5 years.

Saint

djsinha · #**1323** 25th March 2008, 12:39 AM

Quote:

Originally Posted by Saint

Bring your time frame that you trade to shorter term ...... if truly a primary dntrend starts,you could still make money in the short term up moves.Or you could learn how to short using futures.

But in a primary dntrend,forget all the buys and holds that may have worked for you in the last 5 years.

Saint

Really, this downtrend is too frustrating. Right now I'm sitting with cash. And watching the daily charts of every companies traded on the NSE to find glimpse of an uptrend that I can trade. But it's totally full of dry sands everywhere......as far as I can see upto the horizon......not getting even a drop of water to drink.
And being a starter, I haven't garnered sufficient cash levels to play in the derivatives segment......had I been, I'd have got plenty of opportunities to short.
Anyway, I'm just waiting. A consequetive higher highs and lows.....and I'll jump in like a hungry tiger made to fast for centuries.

RSI · #**1324** 25th March 2008, 06:51 AM

Hi amit,

I am unable to upload my post as a single message. Hence I am splitting it in to two and uploading it

RSI · #**1325** 25th March 2008, 06:51 AM

Quote:

Originally Posted by jamit_05

My concern right now is: Now that stocks are in a confirmed downtrend, what do Traders do? Will these concepts readily apply to other markets like commodities or forex?

Kindly advice.

Amit.

Hi amit,

Problem with many of us is that we can trade only in raising bull market. Add to that is the ever raising bull market since we had 2003. But the trouble arises when we are not provided with this sort of bull market. But please note market trading in a range requires different tactics. Similarly, markets trend downwards (like the one we have now) also requires different trading tactics. What most of us try to do is to apply the same tactics which were hethreto being applied to raging bull market. That is where one is caught on the wrong foot. Understand this difference. Then you will have no problem in making proper trades. If you had applied techniques that are suitable for down trending market, then you would have earned huge profit.

RSI · #**1326** 25th March 2008, 06:52 AM

However, if you cannot change the trading tactics, then the perfectly legitimate option would be to sit out and wait for the opportunity. You will have to be patient. If you loose patience here (as many of us have lost), you will end up buying in a market which spiralling downwards only to raise level of pain and anxiety lateron.

Hope this helps
Thanks and regards
R. S. Iyer

Saint · #**1327** 26th March 2008, 02:38 AM

Quote:

Originally Posted by RSI

However, if you cannot change the trading tactics, then the perfectly legitimate option would be to sit out and wait for the opportunity. You will have to be patient. If you loose patience here (as many of us have lost), you will end up buying in a market which spiralling downwards only to raise level of pain and anxiety lateron.

Hope this helps
Thanks and regards
R. S. Iyer

Nice,RSI.......

Saint

prabhjeetrana · #**1328** 26th March 2008, 01:31 PM

Hello Saint,

I was watching the Educomp chart where you had taught the buy set up on weekly charts. I have observed same kind of set up on ONMOBILE charts, but my poor mind has some doubts:-

1. The Pivot high of 655 has not been cleared though we have a higher pivot high, so do we take the trade or wait for 655 to be taken out.

2. Secondly if i wait for 655 to be taken out the stop would be at pivot low of 455, so the risk/reward ratio may be highly scewed and the target would have to be atleast 1255 for risk/reward of 1/3, is it advisable to take such high risk or can i take a position at clearing of last week top at 515 and stoploss at 455 pivot

Regards

djsinha · #**1329** 26th March 2008, 05:49 PM

Quote:

Originally Posted by prabhjeetrana

Hello Saint,

I was watching the Educomp chart where you had taught the buy set up on weekly charts. I have observed same kind of set up on ONMOBILE charts, but my poor mind has some doubts:-

1. The Pivot high of 655 has not been cleared though we have a higher pivot high, so do we take the trade or wait for 655 to be taken out.

2. Secondly if i wait for 655 to be taken out the stop would be at pivot low of 455, so the risk/reward ratio may be highly scewed and the target would have to be atleast 1255 for risk/reward of 1/3, is it advisable to take such high risk or can i take a position at clearing of last week top at 515 and stoploss at 455 pivot

Regards

Prabhjeetrana, we have a higher pivot low only. We'll acc to our system, wait for the pivot high of 652 to be overtaken. We place our trade above 652 with stoploss of 455. Don't enter now. Let it take out it's prev pivot high of 652.....only then can we confirm that it's in a uptrend.

Comming to your 2nd question, When we enter at 652, 455 will be our stoploss. Acc to MM rules, total amt u buy will be
(x% of total money u want to trade)/(buy price - stoploss).
where, x = allowable risk percentage u want to bear.
That's it. We don't consider target while trading. We only try to manage risk. And let our profits fly.

Saint will be in a position to give u better view.
(I've attached chart of onmobile).

Cheers
djsinha

RSI · #**1330** 26th March 2008, 06:21 PM

Quote:

Originally Posted by prabhjeetrana

Hello Saint,

I was watching the Educomp chart where you had taught the buy set up on weekly charts. I have observed same kind of set up on ONMOBILE charts, but my poor mind has some doubts:-

1. The Pivot high of 655 has not been cleared though we have a higher pivot high, so do we take the trade or wait for 655 to be taken out.

2. Secondly if i wait for 655 to be taken out the stop would be at pivot low of 455, so the risk/reward ratio may be highly scewed and the target would have to be atleast 1255 for risk/reward of 1/3, is it advisable to take such high risk or can i take a position at clearing of last week top at 515 and stoploss at 455 pivot

Regards

Dear prabhjeetrana,

Your question is directed towards Saint. But I am poking my nose uninvited. Understanding is that Saint will pardon me for that. He is very generous. I know it very well.

I am not offending you nor shall I ever try to do so. You seem to be excited to take the trade. That is my guess. Excitement is the last thing in trading. Keep it aside and think logically before taking the trade. If you are taking the trade then you must wait for the completion of the candle. In the chart posted by you, the weekly candle. Otherwise, you are anticipating that weekly close is going to be higher that last week's low. But can you anticipate such a close? If you are an experienced trader and if you can read the chart very well, no problem. Otherwise, please make it a habit not to trade on weekly chart, that too on the last weekly candle before the closure of week. What are your plans if it were to close below the low of the last week candle? How does the picture look in such a case? You will have an outside bar having greatly negative implications.

I donot know whether you have done multitimeframe analysis and then decided to take the trade. If that is the case, then you must be taking trade on daily chart or intraday chart by looking at the weekly chart, not the otherway round.

Of couse, I have left the final decision to Saint. If he disagrees with my views, I am open to all criticisms. I could not resist myself after seeing the chart posted by you.
Thanks and regards
R. S. Iyer