Friday, February 11, 2011

Mind over Optimism

Jitendra said,

The mechanical part of my mind asks me to go short almost everyday after see technical indicators but it has to face huge resistance from the optimistic human part of it, which everyday hopes for a bounce back from oversold level. "Winning in trading requires winning emotion first."


My notes,

Market is in intermediate downtrend. Nifty is making new lows. Discipined trading requires following the trend - correctly desires to go short. But, the experience of the past two year bull market remains with us, every dip is followed by a sharper rally. This causes conflict between the optimism and trend. Well, you have to sort it out yourelf.
You should also have some emotions while trading because sometime these emotion save us from a big loss.

7 comments:

men said...

Dear Mr. Sudarshan,
In one of your previous threads, you said that we invest in blue chips? My aim is to buy say 100 for 10K and by trading sell 90 for 10k and hold on to the other 10 for THE NEXT GENERATION from this year as my trading and investment stocks are the same. I am happy with nominal returns but wanna sleep well at night.
2. As 90% traders loose then the above is a nicer method for trading.
3. Where can I get the historical PE for individual stocks?
4. I know the Res and Supp. of my stocks, and sell and buy them at these levels(sell if bot lower and buy if sold higher DOING the same counters), now at these levels how do I know that these will hold and not go the the next level? To over come this I am reducing my traded quantity, and on a bad day I take a calculated risk and buy a big quantity, can you please suggest on how to improve my trades here? For the above I depend mainly on pivot points and fiboancci levels, I generally ignore rsi or other indicators.
Thanks,
Regards,
Sudhin Bathija

Krishna said...

Dear Sir

Now query in my mind is that-

Is it really necessary to have chart reading skills to handle equity mkt ?

Can a simple person like me not find a place in stk mkt without gaining technical skills ?

How come peoples used to execute successful trades when charting & technical analysis & computers & internet & data itself was not available so easily.

Last but not least

Warren Buffet & Rakesh Jhunjhunwala are well known for their success in equity mkt but not for their technical or charting skills while on other hand many well known technical analysis do not grace the list of successful traders or investor in mkt. Why so ????

Above is an honest query from me & I request you to give your views on above.

I also welcome an open & healthy debate on this from all members so that a true business sense can be developed rather than killing the time in endless tech discussions which are good for academic purpose but do help in developing a true business sense ”.

Regards

shabsaif said...

Dear Sir
Please let me know any mutual fund scheme, which trading on base of technical analysis. I mean , the price of fund should always going up (by trading income), compare to market will go up or down. I don’t have time to trade in market and also watch the TV (5-6 Business Channel) and learn the trading method from hundreds of so called experts.

I think you should join and work for mutual fund rather than TV, so million of investors benefitted. We are very busy in our daily life, so we just want to invest in mutual fund, and earn lot of money. So please don’t waist your time on TV. Thanks and All the Best.

Rushabh Shastri said...

My comment may be out of this Topic but when Relcapital was Rs. 830 on the date of Diwali now one was knowing that it will come to Rs. 388 in a so small period..I want to say not only charts help to trade but you need to hear a single word/news affecting your company/stock and that you need to related with charts...recent example is STRTECH good news is showing with Charts and its bouncing with volume from oversold zone and its a quality stock with sound business model...one must be aware of single news/fact affecting its trading/investment stocks...We personally like DISHTV very much but news has made him Rs. 55 from Rs. 75 we cant help...STRTECH was Rs. 110 but came to Rs. 45 what to do??? STRTECH IS STILL A GOOD COMPANY IN OUR VIEW one must be ready to pain also with some quality stock also

jitender said...

Hello Sudarshan Ji
Thanks for your reply. I am really honored.
For these conflicts of mind I always have a fatherly "figure" with me which when I go wrong in my trades saves me from big losses and that's my stoploss. Fatherly as it deserves due respect and also when you have a strict one it makes you disciplined. So if trend is friend than stoploss is father.
Am I right Sudarshan Ji.
Alas can't listen to your morning sermon on ET Now as I teach in a school in morning. Is there a way I can watch those videos later in evening on ET Now site or elsewhere ?
thanks once again.
Jitender Yadav
New Delhi

nawaz said...

Hi Sudarshanji,
I am neither a trader nor an investor. I am just a passionate market watcher. I would like to listen to your view on automated trading!!!!!!

ANAS said...

Respected Sir, its mew again...

It is a relief to have you back on the blog.

As we have seen , that nifty had shed almost 1000 points , after its diwali high. The sebi, and some other market participants believe "BEAR CARTEL" activity is responsible for it. Sebi has also put on an enquiry activity on about 26 large market participants , including some FII & domestic brokers...

Your views on it will be of very high value!

Thank you once again for staying in touch with us.

Yours
Anas Elias Batla.
Kolkata