Technical Trading - Practicing the Theory

Dear Friends,

I'm in dilemma whether I am able to reach you , as everyone turned silent on the posts. Heard from some co-members that the posts are not in the reach of learners of the analysis. I think I have to relook at what I am doing. So, I request you all to put your comments and help me in taking a decision whether to continue it or to have a different approach to reach you.

And I reiterate that the purpose of this thread is to help the readers in practicing the theory and this is definitely not for the veterans. So, continueing this in this manner - where the focussed readers are not benifitted and for the veterans it is like a revision - I think is not useful spending of my time and your time as well.

Waiting for your comments to take a decision over the approach.

AJAY

And finally I turned to be a senior member with this dilemma post, as Ashish put it rightly

Dear AJAY ,

Congratulation and Thanks for starting such a good thread and writing Advance topic like this in so easy and understandable language . I am sure that to gain a level of experience in this thread one has to pass through many up and downs in real trading world , which is now available by only reading your post in this thread for traderji family . I request you to continue thread and give us your insight , this thread prove to become more good trader for beginners and advance student of trading and we will post replay when we can't understand or we have any question .

Thanks and Regards
Harish Chheda

Ajay,

Certainly these are topics helpful for any trader. But looks like the start ups are not able to see any value in it. May be because it's not as easy to understand as some indicator. But hope people will see the value in the words soon. And why to punish those who are finding it useful? Did not christ said, "O God! Forgive them as they don't know what they are doing."

Best Regards,
--Ashish

Ajay
Plz dont discontinue your valuable thread
i just came across it today
this is indeed a great thoughtful post
regards
Naveen

Dear Ajay,

Please do not discontinue, your practical experience is very helpful for beginer like me. If for any reson you discontinue, we will be missing something invaluable.

Regards

Ferdous

Dear Ajay,
Let me reassure you that you are doing a great job. However, do not think even for a moment that we are not reading you threads. We are not asking questions considering your health condition. If we ask questions, we know that you will be constrained to answer them, which means putting additional unnecessary presurre upon you. Remember the great saying in Holy Bhagavadgita, "Do your duty. Do not worry about returns" (Karmanye Vadhika Raste Ma Phaleshu Kadachana). I hope I spelt in correctly.

Whether I am a senior member of junior member is inconsequential. If I post exactly one hundred posts, I will become a senior member in this forum. Simplest way to do that is to post as many flatteries as possible in as many threads as possible. It is the quantity that matters and not the quality. Seniority is thurst upon me and not earned by me. Indeed in some other post, I read some member (who is a senior member) frankly admitting that even though he is shown as a senior member, he is not the real senior member and he considers himself to be a junior member. I donot wish to name him. But what I would like to emphasise is the truthfullness and the honesty shown by that member. For me it is sufficient, if I am a member of this forum. It is irrelevant whether I am a senior or junior or just a member. I hope this post clears all your anxities.

Hi Ajay...I'm sure the readers (just as this one ) are soaking up your posts with great enthusiasm and avid interest.
It's certainly a subject not touched upon before, and your command on the subject, and teaching of it, does lend balance to the overall knowledge base of this great forum.
Quite likely the reason for not a lot of posts here is, your overall subject is rather wide but quite specific. The readers are aware they are on to something important and are waiting for you to tie-up each heading as you go forward.
I certainly am.
Please do keep it up.

Hi Ajay,

Think you are doing a great job..........do continue your endeavour in sharing your knowledge and experiences.

Great job so far........the questions will come pouring in,my friend,and sometimes with a gush that may get a little too difficult to handle,............in a forum that attracts individuals interested in learning,matter of time before questions crop up.

Your thread is one of the best of this forum............looking fwd to many more!!

All the best!
Saint

ps:And looking to many thousands of posts from you,my friend..........

hi ajay,
a great insight to the market mechanism.

and a couple of questions:
whats the volume (percentage of holding of the total paid up capital of the company) in which the LT trader trades in?

and secondly, for any long term player how does the fundamentals (dividend yield) plays to negate any noise emitting out of the technicals?

cheers,
jdm.

Dear Friends,

Before going ahead I have two things to address.
The first one is about the responce. I am sorry for misunderstanding your silence, which I realised only now on looking at Munchikana's reaction.

Yes friends! you are correct. At this juncture it is really difficult to answer the queries if they start queing up in line - all blame on my health. I again apologise for my misconstrueing the things.

But I request you to make a note of all the queries with reference to the Post No. and start posting. I'll try to come back with the answers as early as possible.

And secondly, I was also misunderstood. Please read my post carefully.

I never had any idea of discontinueing this thread. I was only worried over the approach part to reach you. I'm not a person who gives up- Thanks to the TA Practices for making me that tough .

And unless the very purpose is served, I promise you all, I'll never give up.

And now JD, your questions

JD! can you be a little bit elaborative on this question.

If it is with regard to the paid up capital of the Company in which the Investors invest in, there is no such hard and fast rule that this should be a better percentage. And infact for the stock to have market fancy, exchange of hands should be there which creates liquidity. If people just buy and sit, then sometimes it lacks the trading interest- there by liquidity problems. Say e.g., LMW- with due apologies to the pride owners of LMW- is a high value investment stock which lacks trading volumes. It is a well respected company and most of the stock holders are very long term holders. So, the value of the stock increased, but the liquidity is not that much- just for the reason that most of them they just hold it and don't want to sell - and count me as one among them.

Dear JD! Again I'm not able to understand the question. So I'm coming up with two answers.

Dividend yield never plays any role in negating the noise. Because generally people who aim at returns by the yield don't look for exit from the security as long as the yield is handsome when compared to the bank rate. So generally the people who invest for dividends, never be in the markets during the noise time or never create noise in the markets as they enter or exit only once. So according to me the community which looks for dividend yield never makes or gets affected by the noise.

Secondly as far as my experience goes, I never had any context to believe that fundamentals and technicals go together always. In the markets we are seeing a 5%-10% jump in good stocks like HLL, ONGC, Reliance etc. in one or two days and a fall of the same percentage on the very next day or vice versa. So, it is difficult to comprehend such moves from fundamental point of view though they are noise in the security's price.

JD! If my understanding over your question is wrong, please elaborate your question so that I might come out with a clear answer, if I am able to understand your question and know the answer to it .

And as the dividend yield has come to discussion, here I'd like to share a theory of trading practice. This I read somewhere. I don't remember the name of the theory or the source from where I read- all blame to my memory loss- But the crux goes like this.

The person who derived this theory used to check the dividend yields' of all the index based stocks on the day of closure of the financial year. Break his capital into 10 parts and used to invest equal amounts in those securities which have got the highest yield- means generally bad performers- higher dividend and lower price which means the stock is not doing well currently. His idea is the Index based stock will start performing one day or other and once it turns green, it will be a multi bagger ( we may recollect the example of Tata Motors Story- from 2001 to 2006 from red to green). So some of them give him a very great return that outnumbers the value of loss.
And one more positive point here is as every stock is index based, every stock is more or less well liquid and a temporary loss of market fancy doesn't effect the exit route, in case if he wants to exit any of the stocks. And also the chances for the companies to turn green are more- someday and once they turn green they are the most wanted.

Friends I hope you enjoyed it. This theory is silent on stoploss practices. So I don't know whether there is any stoploss mechanism here. But prima facie it is looking very good to adopt- by a sane mixing of it with our TA.

So friends! once again thanks for being with me and I'm going ahead presuming that my explanation over the said topic is enough lucid to understand.

Happy Practicing TA

AJAY