Sunday, October 25, 2009

The 'Aha' Moment

When you start trading, the intiial period is a struggle. As you go with the learning process you unconsciuosly know more and more about trading but you do not realize that you know. There comes a moment, when you suddenly say to yourself "I know what to do". That is the moment of self realization.

Our friend, Chandu has just got his 'Aha' moment. He writes:

"What i understand is go with the trend until u stopped out or trend gives reversal."

My Notes: Absolutely. You have understood the essence of successful trading. Remember that the implementation is not easy because the market does not provide a straight line to success. There are many hindrances which we should call 'whipsaws'.

More on this topic, later.

8 comments:

CHANDU said...

Every trading method has a whipsaw.Iam trying to overcome it(is it possible!!! ?).

The problem with me is trying to book out early.

Thank u very much for knowledge.

Best regards.

pranav said...

Dear Sir,

I am a regular follower of your blog. Your blog is like institution for small/retail trader like me. May I request you to request CNBC on behalf of me to conduct an investor camp in nasik?? ( No need to mention that one of the guest should be you). They haven't conducted one at above place...
thanks n regards,
Pranav Kulkarni

Kaustub said...

Respected Sudarshan Ji,

What I understand by Prashanths comment that your view is...
"the trend is to go long in the current bull market" and "to restrain taking short positions during corrections"
But when Chandu shorts at 5100 you are appreciting him
If trend is up and your views are as quoted above, Chandu would have restrained himself from shorting .
It would be very nice of you if you please elaborate.

Student Of Market said...

Dear Sir,

here are my take aways and AHA moment as I listened to you. This is what I learned from your talk:

Regarding the market movement in the immediate future: since the trend has been up, we must trade in that direction and there is not much use speculating where the top would be. When the trend reverses as it surely will, we should be prepared to trade in the other direction.


Techniques on "Buying on Dips". Sudarshanji distinguished between two situations:

1. The first one was when the market in a sideways rangebound movement within an overall uptrend. The appropriate indicators are Bollinger Bands, Kelter Channels, CCI-100, EMA-50 and idea is to wait for the price to touch the lower ( or middle as appropriate) bands.

2. The other situation is when a strong uptrend has resumed, In such cases, the price may not dip to the lower bands mentioned above and the appropriat3e indicators would be Triangle formation, NR7, or Wedge patterns. The idea is to wait for such patterns to happen after resumptions of a trend and then trade in the direction of the trend.

For me, the presentation answered a long standing question as to which dip indicator is suitable for which occasion. The clarity of this presentation was just amazing.

Sir, May I request you to put up ur slides in this blog unless there are any copyright issues?

Warm Regards, ....

gourav said...

Hello Sir,
This is gourav here.I am a software engineer in TCS@Bangalore.When i came to know that you are comming to chennai cnbc investor camp I went there to listen only You.And it was more then worth of travelling from Bangalore to Chennai.
Few question i asked you
1)I am working in shfts.shift timings are from 6AM-2PM,2PM-10PM and 10PM-6am and i get wekly off on 2 week days,instead i have to work on sat-sunday.So I am able to watch the market half day.Should i do intraday.

Your answer:
*Stop doing intrady from now if u cant watch the maket full day.Do intraday when u have off.Other days do EOD tade and decide what to do overnight.

This answer one can think is very simple.But it has chaged my whole life.Now I have stoped doing intrady,but still making profit and felling more relaxed,because now Ican enjoy my weekly off

Then again when I heard that u r coming to blore I jumped like anything.because I obey u like my guru.I day is not complete without reading ur blogs.And Bangalore session was very very useful.Its usefulness i cant exppress in words.

You told IF we trade only one side of the market(that is only long side when market is on uptrand and short when market is in downtrend)if may miss some move in opposite direction but it will make our life much more simpler.I checked the same in NIFTY for last few months and saw that there were very less short selling profits as compared to long trade.And I have decided only to trdae one side of the market.

And talking tou was really very exciting.

Lastly I am waitng eagerly for your BOOK and SEMINAR.Hope u can recognize me now.

Regards
Gourav

CHANDU said...

Hi kaustub,

I found negative divirgience in charts and exhaustion and tiring of bulls.After touching 5180 it came down,so iam not short at uptrend level of 5180.I was short at 5100 and thats 80 points away from the top.

By the way i covered my shorts today and took longs...i agree we are below major trendline and facing resistance at 5060-5075.But i participated and booked out.Let my SL hit at 4900.

Best regards

men said...

Mr. Sudarshan, for using Guppy's Ma, could you suggest what period is one to consider for delivery buying, is it the weekly trend? How should one replicate the same for intraday? Also when should one consider the monthly charts?
Finally when does one use SMA's and EMA's? Sorry for posting so many questions. Thanks,

kk said...

I THINK MY PERSONAL VIEW IS YOU CAN NEVER SHORT THE MARKETS LIKE INDIA I KNOW THERE ARE SOME VALUATION CONCERNS. BUT IF THE CIRCUMSTANCES ARE FAVOURABLE, THE LIQUIDITY IS GOOD,AND TILL NOW THE TREND IS ALSO UP. PLAYING JUST FOR 100-200 PTS DOESN'T MAKE IT LOOK GOOD.JUST BE A BIG BULL MAN