iCharts Discussions

[vaishuu82]

Very true, Umesh. I repeat something said earlier, every time you post advice, something new (& useful) to learn from you. Thanks, Prakash Holla[/quote]

[umesh1]

[pkholla]

[umesh1]

If I were to ask you to name 25 words that come to mind when I mention “trading”, chances are that “teamwork” will not make the list.

But when you think about it, isn’t that odd? It doesn’t really make sense for why trading is looked upon as an individual activity. The common notion is that you get behind a monitor (or phone, tablet, etc), login to the terminal, and trade away. The mere idea of how trading can be associated with teamwork might even seem like an alien concept.

But it has been shown that traders that work as a team do better than individuals. When institutional trading firms hire traders, traders generally do not work independently. They work as a group, as a team, bouncing ideas off of each other. After all, it’s not as if one trader is going to “steal” another individual’s trading idea and harm the other’s chances of earning a profit. If anything, by using similar strategies, the two will benefit.

But institutional firms have that advantage of being able to group together like-minded, intelligent traders into one room. What do you do as a retail trader, trading from home or at work?

Think outside the box
The first, and obvious, choice for an online retail trader is to go to forums and interact with other members. There are numerous online forums that directly serve this purpose.

But you can do more! If you are serious about bouncing ideas off of similar minded individuals, why not take the bold move in hosting a get together/seminar in your city or area? If you are a full-time day trader, perhaps you can group together a dozen others within your city and you all can huddle together in a coffee shop and trade away! If you’re an investor looking to bounce ideas off of other like-minded investors, you can create a meetup event. In fact, websites like meetup.com exist to exactly serve this purpose. Chances are that there are already meetup groups within your city where members are benefiting by picking each others’ brains. Why not join them!

Don’t be afraid to share your trading strategies with others. The market is far too liquid for any individual or group to sabotage your ability to earn a profit from your strategies. Instead, you will end up learning from others, through which your strategies will improve.

And last, but not least- meeting up with other traders makes the activity of trading more enjoyable and fun. And, like any other activity, when you do something you enjoy- you will end up doing a better job

[vinay28]

[apka]

[umesh1]

Rationalizing todays market move
Posted on December 9, 2014
Pundits (be on Television or Newspaper) have a way to rationalize everything that happens. Every market move is due to some or the other news. When markets are bullish, all reasons are bullish in nature and even those that aren’t turned around to mean as such.
So, if the markets are up despite there being a bad IIP nos, its explained away as Investors / Traders betting on a Interest rate cut. If it falls, of course IIP no’s were the culprit. One day the markets rise is explained by what happened in China while the next day, China does not even matter since market action was due to the downgrade of ______ (Fill up the country of your choice).
People love rationalizing. Period. Every move has to be explained by some event or the other. So, yesterday’s move down in our markets were due to selling of shares by the Ex-Promoters of Infosys while for today’s move, we have China to blame.
The interesting thing about China is that, much of the world did not even know that there existed a stock exchange in Shanghai until it started rallying in recent weeks. Today’s one day fall in the market has in a way stuck a match for the others with markets around the world falling in sync. Incidentally, Shanghai Index is way way below its 2008 highs. The relative performance chart of Shanghai vs Sensex showcases how despite being up 38% up in this year, the performance is nowhere comparable to our performance.
As in the past, China will be quickly forgotten as soon as the markets have something else to bother with. Not too long ago was Cyprus / PIIGS a big problem for the market. Right now, most cannot even remember what the issue was about in the first place.
To conclude, I am reminded of Judy Croome’s quote “Today’s news is tomorrow’s history.”. The only way to win in the markets is by sticking with a plan. News neither makes nor breaks the markets. So, stop rationalizing
Gann intraday system moves with the market
Cheers

[pkholla]

Umesh: Very true. In fact in a book reco by you, there are 18 millionaires who make/ made money in the stock market and comments on their methods.
One such trader, Grant Noble, buys all the newspapers and trade journals, makes a summary of expert findings and recos.
THEN he goes CONTRA!!!

If you visit moneycontrol then there are hilarious comments about the TV expert Tulsiyan! Arey aaj Tulsiyan long hai SBIN mein, I am going to short

Jai Hind, Prakash Holla

[umesh1]

The Broken Bank
Soros had been building up a huge position of British pounds for months leading up to late 1992. At the time, Soros realized that a monumental shift was in the making.

The European Exchange Rate Mechanism (ERM) had been setup in 1979 as a way to keep currency rates steady and to reduce currency rate volatility. The idea was that at some point in time, a single currency could be used across Europe. Of course, this did occur 20 later with the introduction of the Euro.

In 1990, the British Pound entered the ERM. However, Britain had entered a major recession and inflation was soaring. It put an incredible amount of pressure on the British pound. Despite all this, Soros brilliantly kept buying Pounds.

Soros knew what he was doing. He knew that at some point in time, the Pound would not be able to withstand the pressure. However, he also knew that the rate the Pound was brought into the ERM was artificially high, and that it was just a matter of time before something drastic would happen.

Of course, that is exactly what happened. On September 16, 1992, Soros’ fund short an incredible $10 billion worth in pounds. While the pound remained within the ERM, pressure kept mounting for something to change. (interestingly, September 16, 1992 is known as Black Wednesday in Britain).

In a short amount of time, Soros’s prediction came true: the UK withdrew from the ERM. This caused the pound to naturally devalue against other currencies, and Soros earned a cool $1 billion through the process.

Soros knew what he was doing all along, and it paid off handsomely. Later on, the moniker “the man who broke the Bank of England” was placed upon him.

Although it’s probably not the best way to be recognized, you have to admit that there is a certain coolness factor when you are known as one who legally “broke the bank of England”!
For Traders strictly watch the hindi movie GAFLA
Gafla begins as a story of an ordinary young man Subodh in ordinary circumstances. It follows his journey into the stock markets and beyond. The film examines the issues of ethics & morality in this Machiavellian world defined by winners and losers rather than good and bad. It was one of Peter Bradshaw's top 10 picks at the London Film Festival 2006
https://www.youtube.com/watch?v=4ZJmLwBztfs

Cheers,

[pkholla]

Umesh: Your story turned out to be positive for the speculator.
But read what happened to Texas brothers Bunker and William Hunt who went long, in 1970, in silver and tried to make millions (= billions today). they lost their shirt, pant, ^^^, ..., etc
No individual can normally bet agnst the market. Cheers, Prakash Holla

[umesh1]

[umesh1]

Trading article written by Norman Halle.
You've got a Great Trading System, So Why Are You Losing?
You've done your homework. You've spent countless hours seeking out the right guru (or piecing together your own system), and weeks of monitoring your guru's daily trade picks (or paper-trading and back-testing your homemade system). You've done it by the book. No seat of the pants trading for you!
OK, now you're confident. It's time to put your money where your homework is.
You've had your coffee, and your first trade signal is before you. Confidence is high. The trade is made -- and you have your first loss. Not a problem. You understood before you started that successful traders both win and lose, and "losing is part of overall winning."
You've also heard more than once that "successful traders don't win on every trade." You move on, and are still confident. The next trade made. Another loss, but this one hurt your pride a little because you got stopped out early in the trade, and then the market rebounded. You would have hit your profit target if you weren't stopped out.
You double check. Yep, you placed the stop where your trading system told you to place it. You kind of had a feeling that the early weakness in the market was just profit-taking from the previous day's trading, but you're trading a system and you must stick to it. You're wounded, but resilient.
After a good night's sleep and a few mouse clicks, your new daily trades are in front of you. Hey, this one looks good! It's a little more risky than yesterday's trades, but look at that profit potential! With a smiling face, the trade is executed.
With a nice start to the trade, you're feeling good and you've moved your stop to break-even, just like your system said to. Then a surprise piece of news -- the market reverses and blows through your stop, resulting in an "unexpected" loss. Is something wrong with the system? Has the overall market "personality" changed, affecting your system to the core, rendering all your back-testing irrelevant? Your confidence turns to doubt.
You decide to "watch" the next trades. I mean, isn't it wise to make sure the system gets back on track before you "throw good money after bad?" Isn't that what a conservative trader does? Trade watched. It wins!
In your mind, you beat yourself up a little because you know that when you started your "live" trading, you made an agreement with yourself to take the first 10 trades "no matter what" -- then you wimped-out and missed a big winner that would have gotten you even.
What's happening?!!
What's happening is that you are out of control. Your emotions are ruling your trading. The above scenario plays out in every trader from time to time -- newbie and veteran alike.
The winning trader senses what is happening and nips it in the bud. The winning trader spends time EVERY DAY working on "the discipline of trading." He reads a chapter in his favorite psychological trading book, scans the "ten commandments of trading" that hangs on the wall over his/her desk, and listens to his/her mental training software for futures traders. He does something EVERY DAY before trading begins.
There are many more losing traders than winning traders, and it's rarely about the trading system. In my career, I've come across at least 50 systems that I consider A+, yet I know for a fact that MOST traders that have traded on these systems have lost.
Why? They were not in control of their emotions.
Are you?

Cheers

[umesh1]

AN INTELLIGENT TRADER
.
Traders make money by betting on short-term price swings. The idea
is to buy when our reading of the market tells us prices are rising and
sell when the uptrend runs out of steam. Alternatively, we can bet on
a decline and sell short when our analysis points to a downtrend, covering
when the downtrend starts bottoming out. The concept is simple,
but implementing it is difficult.
It is hard to become a good analyst, but harder to become a good trader.
Beginners often assume they can make money because they’re smart,
computer-literate and have a record of success in business. You can get a
fast computer and even buy a backtested system from a vendor, but putting
money on it is like trying to sit on a three-legged stool with two legs
missing. The two other factors are psychology and money management.
Balancing your mind is just as important as analyzing markets. Your
personality influences your perceptions, making it a key aspect of your
success or failure. Managing money in your trading account is essential
8 FINANCIAL TRADING FOR BABES IN THE WOODS
for surviving the inevitable drawdowns and prospering in the long run.
Psychology, market analysis, and money management—you have to master
all three to become a success.
There are two main approaches to profiting from crowd behavior. The
first is momentum trading—buy when a ripple starts running through the
crowd, sending the market higher, and sell when that ripple starts losing
speed. It is a challenge to identify a new trend while it’s still young. As
the trend speeds up and the crowd becomes exuberant, amateurs fall in
love with their positions. Professionals remain calm and monitor the
trend’s speed. As soon as they find that the crowd is returning to its normal
sleepiness, they take profits without waiting for a reversal.
The other method is the countertrend strategy. It involves betting
against the deviations and for a return to normalcy. Countertrend
traders sell short when an upside breakout starts running out of speed
and cover when a downtrend starts petering out. Beginners love to
trade against trends (“let’s buy, this market can’t go any lower!”), but
most get impaled on a price spike that fails to reverse. A man who likes
peeing against the wind has no right to complain about his cleaning
bills. Professionals can trade against trends only because they are ready
to run at the first sign of trouble. Before you bet on a reversal, be sure
your exit strategy and money management are fine-tuned.
Momentum traders and countertrend traders capitalize on two opposite
aspects of crowd behavior. Before you put on a trade, be sure to
know whether you’re investing, momentum trading, or countertrend
trading. Once you’ve entered a trade, manage it as planned! Don’t
change your tactics in the midst of a trade because then you’ll contribute
to the winners’ welfare fund.
Amateurs keep thinking what trades to get into, while professionals
spend just as much time figuring out their exits. They also focus on
money management, calculating what size positions they can afford
under current market conditions, whether to pyramid, when to take
partial profits, and so on. They also spend a great deal of time keeping
good records of their trades.

[rishveer]

[Raynor]

i wish i read it long ago.. gem of words... learned these things through other way. i.e. hardway.. thanks a lot for sharing