In 1st 5yr,...its novice game(assuming 5yr a bull bear cycle) 2nd 5yr...seeing market , another casual+ cautious approach
3rd cycle...here actually u make money, its different for others, but repeatation for u.
4th cycle...its catwalk , ur presence gives money, its taking laddooo from child ...Trade as & when oppurtunity comes, dont force trade
self analysis to be a trader
1] do u believe in prediction? ur success rate
2] if u dont do prediction, how u create directional bias, what is strike rate of that tool?
3] if wrong , how quickly get out, to save money on table 4] how well u understand & have skill in any field of life 5] your ACUMEN
A simple analysis ...
Most of us watch CRICKET,listen to commentary,...we think just like a batsman we can play, actually we are NOVICE, commentator r ex player, no more can play.n Test players r real pro.
Actually we dont have the capacity to play in real arena.
spectator can never be a pro. They spend money to see the match, PRO earns. Novice gives money to learn what real trading is all about.
In imagination ,we think like we r commentor, ...i would not DO that mistake in batting.
Actually there is lot of gap between , chosen player/commentator vs spectator.\
Even to get a call to select in PROBABLE...u have to PERFORM a lot.
Reality vs illusion...understand .
, 90 % people r not suitable for trade learning.But other 10% can learn it,simply earn to run family- 90% its dog's tail,for those 10% ...they become within short time like others, become emotional and lose.However under proper mentor , they can make sufficient moey to run 2 generation.
Trading is always uncertainity, good trader r master risk manager.
A man called,BERT at singapore,ota ...shows the imp of skill, it takes him 20yr to learn/earn from trading.so he's now millionere trader in forex.
i saw ,not to trade for 3days, then on a flash quickly earn about 10000$ in forex, as he found high probable /low risk set up . yes for av joe ,trade learning is not possible.
...here is a professional approach to learn Level 1
...
1] introduction to trading & trading foundation
here u shall understand pro vs novice,basic thinking/action difference.
2] ta- demand/supply ,candle- trend...thats all
3] trading strategy, buy low/sell high...counter trend/break out
4] understanding pattern for long term bias, reversal /continuation & volume relation 5] Ta tools- indicator, remember they help /supporting tool
ma/macd
4] evaluating a potential trade- odd enhancer 5] risk & position management
6] laws of trading
7] trader's mind -psychology 8] be a pro-pre -post market analysis PLAN
Some truth to novice
05 July 2015 12:26 PM
To be a Trader-20yrs Page 140
PLAN
TYPE OF TRADER A-B-C PATTERN
APPLICATION OF TRADE PLAN ON U BASIS ... ...
A] successful traders trait B] ur plan /routine -execution
c] game/book u play/read to IMPROVE TRADE SKILL ...most people dream & lose money in market.
1] pro makes money -because they lose less.Novice lose because of HOPIUM
2] pro knows market prediction not possible,only high probability turning pt,he can pin point.they take position,but get out early if wrong.Novice fears ,and buy after upmove ,actually when pro r ready to book profit
3] PRO study risk/reward relationship in chart.Novice search with his greedy eye,biased to win/money...react emotionally 4] Pro get out/get in EARLY,before media hype...novice listen to TV,act late to lose
5] pro creates a plan,then execute as per plan,with if...then ACTION...
NOVICE ask/think then trade,never proactive.
as a new learner,answer first why u will make money,...others shall lose against as a trader. Being a BULL u have to predict fall of BEAR,as well as CHARGE early to take credit from OTHER bulls.
Understanding SUPPORT/resistance dynamism and money flow in terms of GREED/fear ,only a baby step. then follow economic event s predictives & its reaction of price in stocks/commodity.
Next learn ,higher time frame bias
If u want to technical trader/...understand which ta tool u shall master, what condition of market ,u bet in market.
Write the trade...reason behind winner/loser,this analysis helps
let us understand a scenario...probable RBI meet to cut interest...
if no cut,...market drift slowly
if 25bps cut,...market move quick up, novice in BUY ,pro in sell mode...as market reaches a strong resistance now if 50 bps cut,...morethan expected cut,,,,,,,,,,, so it will be decisive up ,with bottom at nifty 6000.
this way if u have to prepare scenario .so action guideline before others give money.
Which Stock?...ofcourse the banking sector.
...
From 4-5 yr regular earning from to switch to PRO level, u reqd to evaluate...ur decision making system(how robust they r... .how good ur discipline habit)
why u make money against others (ur edge)...ur skill to play BIG on winners ...
can u predict,market in bull trend or in exhaustion mode...if YES, big money awaits for u Pl learn to play contrarian against news.
A big move in ONGC,brings to longterm resistance to 350, ...so short and take money in market.
remember...good news give u---selling oppurtunity Let us question ,very critical for a trader...where u suit?
1] longterm player-investment type 2] aggressive trader in position 3] short term swing play 4] intra day player
...all have strong success , in proper market condition
...1] think long contrarian ,in big stock on big fall ,comes to enter once in 4yr cycle 2] here u play on fundamental understanding, in price chart -break out.
suit large-mid cap.
MA is good tool ,but technical stop must,use atr as sar.
3] play in counter-trend or pull back in direction of main trend with small stop,entry total position in single go,avoid news/result here.
4] intraday- based on momentum or continuation , stop .1ATR,profit 1/2 atr...play in volatile stock ,where u know how that particula r stock behave ...ur guessing or analysis is good at market,by proven return on market...so switch to future. On big -ive scenario ,short at resistance,with stop on 1/2 atr.
Similarly ,u strongly know imp support,ready to risk some amount...so buy support value(call)...if expiry is atlea st 10 days.when right get 6-8%,if not lose ...2% call money. If call value about 3% underwrite call.
--- ---major thing for trading is TRADE PLAN.
YOU HAVE TO TRADE ,AS PER WRITTEN PLAN.
1] what type of personality...suits for trading or not.
2] what type of market
3] understanding uncertainity & your action guideline against it.
4] momentum plan 5] swing plan 6] exit rule
7] money management strategy 8] how U define , market shall move up 9] your guideline to keep u neutral
10] strategy of learning from ur personal trade history.
Price doesn't lie. Price doesn't alibi. Price never complains and never explains. It is what it is - Bhav Bhagwan che! ...this truth from EAGLEONE...always to be respected .
... ...
Quick thought process,flexibility ,experience r my edge;,,,,,,,,,,,,so pl get more. shall try to give CLARITY .
U can see trading zig-saw puzzle solved and elements will be shown , may not be elaborate.No knowledge gap....Order may be as perceived /at random, but all has its relevence.
So i start NOW INDEX
1] trading,investment vs gambling
2] why novices/ameteur fails and shall fail yr after yr ? 3] what is successful trading model
13] why we r born to fail /but u can convert urself successful trader 14] Commitment
15] confidence 16] Mentor vs mentee
16] Mentor vs mentee
17] value of regularity vs discipline 18] Patience
19] whether Discreationary or Mechanical 20] Problem of self sabotage
21] Envirornment
22] Economics...the backyard for trading field 23] Equity curve...INSA ALLAH of stoploss 24] DO i STRESSFREE ?
25] understanding EIC model 26] understanding sector model 27] Usefulness of TA
28] Creating TA model
29] A mode for searching oppurtunity 30] how to use software
31] Risk mitigation theory 32] Fitting the zig-saw puzzle
... ...
most of this is already mentioned, still some may be clarified.
---
To be a Trader-20yrs Page 142
1]trading ,investment vs gambling ...
TRADING : its nothing but trade off with potential risk vs. profit dream , most novice can not visualise actual risk , so they could not a plan potential risk mitigation , and fumble before actual risk losing money. Honestly they should make only on condition understood by them, which has higher chance of happening ,at nearby support base ie. at least risk potential ,Theoritically u should plan a 15/- profit on 5/- risk. Since we can not see future ,we have to forecast ,always prudent being wrong what to be done.Uncertainity of the event , not uncertain in ACTION.
OrderFlow is to be understood to predict what comes next. Its a skill on future reading, by seeing ENOUGH past.Alternately by seeing what happening in higher time mode, similar happening on smaller timezone(BIAS). A quick study of weekly price in detail...how it may give big picture.
IT is imp to understand least risk ,and high probability.Then understand MOMENTUM or flow.
INVESTMENT : when u have excess money,u keep in BANK,the institution lends MONEY to big houses/enterprenaurs against flow of interest.So they have to check the party ,whether business in proper shape or not(not investment apprisal report,nor broking house analyst visit)...these shrewd finance practitoners can tell/smell danger and oppurtunity, suggest some remadial to enterprenaur , ...so understand technically if they create a TRUST, floating mutual fund, complying regualations,...now utilising that info before others ...they can take postion and sell later at tight time.Pl understand bank works on principle of interest ,paying u 7% ,taking from industry >10%...so by least risk ,if they could get higher return ...mutual fund ,backed by Banking r born.Its inside INFO (sensitive info + interpretation skill + jardon to decept others)...sole purpose to create higher return for fund.
So where is investment? ITS the inside info. One of best house ...TATA 2001-02 write off TELCO/TISCO certain loss and other financial headeque ...keeping price below 100/-...yes creeping acquisition by none other than TATA investement and TATA sons...only after 3-4 yr u know the fact. Again who bought TELCO 2008-9 at 250-280,and later selling around 1000/-...yes its the big man TATA.
Have u seen the game of RELIANCE ...2 brother split drama,...and later rise of stock price some yr back? YES Reliance cap/fund manager Mr Kela... they r buying ,when public are feeling panic.YES another great negotiator...icici fame also dealng. Mr Kamath ,the famed officer 30/35 yr back hog limelight by giving fund to Mr D A...yes this time its not info...but a planned game to make money out of market.
HAVE u seen how money made...price rigging before after buyback ? DO u know how investment banker get the deal ...
Yes actually Investment is nothing but a scheme of making money, mostly by some persons with contact...sometimes understanding /visualising a situation before it happens , sometime creating it...mostly on INSIDE info. YES if u understand macro-economics/holding some higher govt post on policy matters ...then u know before others what may happen .But ur PA made more , by dealing with cartel called OPERATOR . Yes principle is money works. SECTOR deregulation pays ,economic cycle move up/down...consumer sentiment
changes ...but bet on shrewd /practical enterprenaur...his stock...u will make big money...La Mittal...story...in telecom sector.
...by the way...theory of valuation...all r job searchers tool, just like marketing guys' smile.
IF u doubt,...just see where modern VC r putting money, small/medium scale industry enterprenaurs.
Again past monologue ...long days back ,a lady put a research firm in VC ...icici,...later in 2002...ipo 440 band...VC put it 20/-...slowly at/after ipo ...make money...yes now its BIOCON.
Everybody knows...reliance power story of...2008/money minting by ANIL ( if u dont, sell all share...all holdings/u cannot live with shark...with poor knowledge...keep money for saving a/c)
...
So any other HOPE ? understand BUSINESS,...when market with big fall/ which sector r actually doing better. Simply buy big name and some growth story...await for around 2-3 yr...U WILL MAKE MONEY BY INVESTMENT
so understand rule and characteristic of contrarian, alternate scenario creation,media hype.
In the say of a big trainer,...u reqd just one story/one company...a big bet with patience , understand why u r betting...money is yours in long run
Gambling : its nothing but what av investrader do actually:...holding the loser. We dream /put hope after purchase ...share price shall move up,but...so we block money and pray, yes its gambling.
I dont know, i have not read...yet i make experiment with hard earned money...again gambling.
Trading is my passion(actually clicking /watching price move)...again gambling.
I have to ask some done ...what to do presently...gambling . I decided to loose max 1lakh, but betting 5 lakh...another gambling.
Selling early the winner...to get thrill of wmoney...its also gambling
Without a plan/risk management tool/proper education coming to market/indiscipline attitude...all r manifestation of gamble.
Pl understand here u r betting against not only shrewdest...but against INSTITUTION , who had practised and developed the art...atleast 50yr.
yes i gamble to satisfy my that instinct...to get thrill/ but i know i shall lose money,...and for making money which shall be discussed later,...i have to invest or TRADE , never to gamble.Never fighter a fully loaded gunfighter from 25m with a bare knife in hand.
... ...
so before u become a successful player in market...pl understand the concept with clarity...investment-trading vs gambling .Throw away gambling instinct from u,...choose any one Trader or investor...lady luck may smile.
2.why novices/ameteur fails and shall fail yr after yr ? Answer : they have not Requistee /prerequistee.
why i can not live in water ? i dont have gill.
TRADE LEARNING ...reqd balanced mind...patience to learn, may be 8-10yr of journey.
Confidence in u,but doubter at heart over situation can whirl, Slowly you become believer in price .NO to gambling attitude Love to adherence to discipline
Stoicism in mind...so that fear /greed has min effect Objectivity development:
Understanding of business/economics/public sentiment
So novices start without map to reach somewhere where few people have reached.So they all r naturally absorbed in quick sand. Yes ALL. THEN
Trading, Investment vs Gambling
05 July 2015 12:27 PM