FOREX : Technical & Fundamental Analysis

quark

So,at last,things seem a little green for us. Or,is it?

SEC has talked about some magical(hypocritical)words last night,the positive effect of which may be found on Index today and tomorrow.........But what is gonna happen after that........???? I wonder,what is gonna happen if institutional traders and market makers don't really bother to enter the market with full swings this time.............That is what is concerning me....!!

Is there any sign of big buyers' buying in any stock yet............?? I need to see them buying....

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Now what about Technical point of view. That is interesting....................

My trading setup is simple. I would trade if the index goes above the yellow line in the chart below. Simple.............And that Yellow line could act as a resistance line soon.That is a very stupid problem. I want to see how DSE acts over there...........Because DSE index may fall down from there.

I am not in hurry. Why? There is a reason. I have found. Not all stocks follow Index movement instantly,though we may see some rise in many stocks,as the Index is about to turn.

What I mean is,have a look at BIFC chart below. Isn't it in charming position? Yeah,it is..........Nice position..........I know it is gonna take at least a couple of days more to rise(If it wants to rise). Several stocks like it will be consolidating at a specific level before they go up. And we will be able to trade them. So,I don't worry. I don't need to worry. There will always be a lot of stocks to trade in the market,if the market is in bullish trend..............

Bullish trend-that is what I am looking for. And if the Index goes above current Yellow line of mine in the chart below,I would consider it bullish trend for short term..............Also,a very important thing for me is that the Average Bull Volume(my third indicator in the DSE chart below)must be higher than Average Bear Volume for me to be confirmed about trend change................

Now another thing we should note also. That is,this new trend may not last long. However,that is a matter of future.............

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Now,why I am waiting for more confirmation. Because around Jun 18th,I had bad experience. I tried to take risk and went anti-trend. I bought at support level of Index taking risk. Things were good at first. I didn't pay attention to trend moves. I didn't care. But Index fell breaking down the support level after a couple of days. And I had to exit with frustration. Later Index remained down for three months. Good for me that I exited early before the downtrend of three months started.

So,this time,I want to go slow.....................But,like I said,in another thread,I feel like entering and buying.........

Anyway,it is never too late. And I don't want to be impulsive. I always know there will be several trades ahead. So,I don't worry and hurry.............20% to 30% profit before election would be enough for me for the time being. And only a couple of quick trade can get me that much. So,why hurry!!!!

quark

Trading Rules
Jesse Livermore's Stock Trading Rules

All successful stock and commodity traders have rules for buying and selling. Many traders today still use the trading rules Jesse Livermore first devised almost a century ago.

Jesse Livermore constructed his rules over several years while he learned by trial and error what worked on the markets. He was guided by one of his favorite principles:

"There is nothing new in Wall Street. There can't be because speculation is as old as the hills. Whatever happens in the stock market today has happened before and will happen again."
Trading Rules

* Buy rising stocks and sell falling stocks.
* Do not trade every day of every year. Trade only when the market is clearly bullish or bearish. Trade in the direction of the general market. If it's rising you should be long, if it's falling you should be short.
* Co-ordinate your trading activity with pivot points.
* Only enter a trade after the action of the market confirms your opinion and then enter promptly.
* Continue with trades that show you a profit, end trades that show a loss.
* End trades when it is clear that the trend you are profiting from is over.
* In any sector, trade the leading stock - the one showing the strongest trend.
* Never average losses by, for example, buying more of a stock that has fallen.
* Never meet a margin call - get out of the trade.
* Go long when stocks reach a new high. Sell short when they reach a new low.

Other Useful Trading Guidance

* Don't become an involuntary investor by holding onto stocks whose price has fallen.
* A stock is never too high to buy and never too low to short.
* Markets are never wrong - opinions often are.
* The highest profits are made in trades that show a profit right from the start.
* No trading rules will deliver a profit 100 percent of the time.

quark

Once I was in trading chat room. There one russian trader was saying that he doesn't take any trading signal unless the price has broken the trendline after the signal is generated........I loved that idea and am trying to create a trading system with trendline breaking idea...........

The map below will have more branches. Say,for example,pivot high-low has certain patterns that are important in uptrend.We need to define which patterns to be taken and which not......etc........

There are also maps on exit,hold etc.........Say,for example,in downtrend,one should stand aside and not trade at all..........But what do we mean by downtrend!!!!!!!

ALWAYS DEFINE THE TREND FIRST BEFORE YOU GO FOR BUY/SELL........

Ummmmmmmmmm............

I posted the above map for a purpose...........It's a disciplined approach to trading........In fact,it is a real way of TA trading.......

In no book,you will find disciplined approaches to TA,because firstly,there is commercial reason. They will write on same the shits several times and publish them in several book for earning money. Fuck these shits....Have a look at the book,"Master Swing Trader". That book sucks. None can trade reading that fucking book,though it is a well-known book in TA world.

Secondly,because,if all topic is really illustrated,then the volume of books will increase.........Anyway,cut the shit!! Let's get to the buisness..............

I always go by Pivot High-Low.........Because,only by that we can determine uptrend-downtrend quickly,detect all types of patterns.................But the process of pivot high-low is so vast that only one single post will not be enough to describe it all........But for giving you some hints on pivot high-low,I am posting on my systems' pivots below..........

The rule of trend is an uptrending stock must have higher high and higher lows When you will understand this,you will feel charmed. Because you will then be able detect stocks moves.........

Below image is an example of the road map for entry that I uploaded above.........Now this road map can again be divided into several sections like I said above...........For example,all trades/entry below will be based on pullback trading......Note that in its uptrend,Yahoo making small pullbacks/dips........And we are supposed to enter them......This is swing trading!!!

Note that we stand aside when the stock pullbacks..........

For trend determination,MA is slow. That is why,I try to avoid them........

Also,note a band like indicator is used to use as a trendline for short term moves.........

There are two trading styles that can be used in an uptrending stock :

1. Pullback trading.
2. Breakout trading.............

Stock making Lower Low and lower highs are in downtrend..............We are not supposed to trade this downtrend. It is like falling knife. You try to catch the knife,your hand will cut..........

See how trendline is broken before the stock goes high........This can be called reversal trading.........Also note the reversal double bottom pattern..........Cool!!!

We connect the Higher Lows in uptrend and Lower High in downtrend with trendline. That is how we use trendline to determine trends and trendline breaks...........See the image below...........

A long way to go yet,my friend..............

Take care!!!
Happy trading!!

quark

Trading System Development

Trading system development – The DUM method

D - Define

All trading systems are based on finding and pulling a fundamental truth about the market. Define what fundamental truth you'll be going after. Eg. All markets have a tendency to trend beyond random. Now you've got the definition that most technical-based hedge funds are derived from.

U - Understand

Determine the conditions under which the defined truth tends to occur. In the case of a trend tendency it could be when does the trend tendency begin beyond random? This will lead you to how to measure a trend. Since trends can occur randomly, how do I determine if a trend is beyond a confidence level of randomness? Does the trending tendency beyond random exhibit the same degree of persistence beyond one year? two years? 5 years? If not, is there some point at which the persistence beyond random occurs every year? If so, does it also persist at the same frequency for 5, 10, 50 different markets? If so, you've discovered a fundamental truth and you now understand what you need to know about the behaviour.

M - Mine

Once you understand the conditions under which the behaviour occurs, you write the code necessary to map the understanding of the behaviour. Is the code going to be all inclusive of many markets? or try to just go after the best of the best? Once mapped it's a mechanical process to determine how well it maps against the behaviour. After you're satisfied you've developed a satisfactory method for mining the behaviour, you can do an edge test to see if it happens beyond random. If not, use Monte Carlo sims to determine confidence levels for trading the method. Determine at what confidence level you'll stop trading. Examine the drawdown versus the profit. Is it worth risking any money on this? If so, allocate money using a money management scheme.

After you're done with this, you'll have your first system. Next, develop a complimentary system (non-correlated). Go through the same process for (a different type) a range bound system. Once you've gone through the mining stage, use the correlation test to weight the two systems. Apply the weights to the money management scheme and move on to your third system.

quark

I like to think averaging…………..I found that averaging candles boosted my trading!

How about averaging volume? This is an interesting idea. In fact,this is an important idea. We need to see volume or accumulation by averaging!!! Why? There are several reasons. But I want to keep this tutorial simple and small(I don’t have time)…………So…………….

I have seen we count the volume like this : If today’s volume goes above last 15 days average volume,then we take it as bullish volume………..This is ok. But this doesn’t tell me many important things………..For example,this doesn’t actually give me buy signal,or accumulation zone,or euphoric zone,or consolidation zone…………….

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The techniques/Four techniques :

There are some techniques of volume reading you need to know. It may make your volume analysis simple, but better………………

First technique is : we need to see accumulation of volume before we buy a stock. This accumulation could be by institution or retail traders. We don’t care. All we care is there is accumulation at our buy zone or signals………..We need volume traded enough before we buy something. Because that accumulation of volume says,the stock is of interest of many………….We need to buy something that the market likes………..And accumulation will tell us about that………..

Accumulation,after a stock has retraced enough or consolidating after retracement,can signal upcoming uptrend of a stock. Let’s give it a name,AV or accumulation volume…………….

Second technique is : after the stock has gone high enough,there will always be profit taking situation. There will be good volume traded,and then the stock goes into consolidation with grey or bearish volume zone……….

But interestingly the stock may start to generate new buy volume at this high level of price. And this new volume generation or accumulation could start a new trend upwards by the stock. TAs have given this type of scenario the name – VT or volume trend. Such volume generations push the stock higher or refuel the trend………..

Third technique is : all stocks must stop their uptrend at a climax situation or euphoric zone. What happens is that a huge volume is traded at the very high level of price. This shouldn’t have happened. This is euphoric zone,because small traders mostly enter at this zone with huge enthusiasm,and big traders sell to them here……….

You will see this situation again and again in almost all stocks. TAs call this zone,VC or climax volume……………

Fourth technique is : we need to ignore falling volume. There are some zones where volume means nothing,and so is the price trend or movement. We need to completely ignore them. This is known as null volume or VN…………….

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The indicator/V-spike :

Fine………..!!! But how do we find out all these? Any indicator?? There is one interesting indicator with the Bull and Bear Volume indicator(a nice one) of amibroker. I have separated and somewhat modified it to suit our need. I will attach it at the end of this post,so all can use it and try it…………..By the way,I have given this indicator the name,V-spike,it shows volume spikes at different level of price……………

See the V-spike indicator in the chart below……….The green is accumulation(depending on where the stock is),the grey is distribution zone……………….

Accumulation Volume/AV :

Now let’s see some example…………First,we need to see accumulation before we buy or when we get a buy signal…………See the chart of Batashoe below. We got a buy signal at the last bar. But interestingly,before that our V-Spike Indicator told there were buy volume. Price has retraced enough. We got a buy signal. Volume is in accumulation zone. This is a good place to buy…………Right…………….

This is known as AV or accumulation volume………..We need to see average accumulation,because that tells us that the stock is strong enough to enter…….

See another type of accumulation. We know that consolidation is a good place to enter a stock. But wouldn’t it be great that we could see that accumulation is going on in the consolidation area……………?? Yeah,it would be great……….Our V-spike indicator will tell us that accumulation is going on at the consolidation zone.………..

See the chart of Agni below. Such a nice accumulation at the consolidation zone will surely tell us that this stock is a nice one to get in………………

Volume Trend/VT :

After the stock goes high,there will be some kind of profit taking. If you have good trading system,your trading system will show you that profit taking zone. Interestingly,after the profit taking is over, the stock goes into some kind of rest. Then,again,we start to see accumulation of volume. Why………..??

Because the volume is actually trying to start a new trend or wave or leg(upward).

Now when we start to see spike by our V-spike indicator at or after the stocks’ consolidation or resting period,we should treat it as the accumulation for the start of a new trend…………This is known as Volume trend or VT. New buyers are entering at this zone,pushing the previous trend of the stock upward again……………This is easy to detect. Usually,breakouts are such trend makers……………….This is the second entry zone into a stock!! See the chart below to understand VT.

Volume climax/VC :

This is a very important concept to understand. A very important one. After a stock has gone higher,the volume suddenly rises unusually. Our V-spike starts to give green volume signals. But that is unusual. Because at a high price,why should the stock generate huge volume………?? Something is wrong here. Yeah,there is…………..

What happens is called euphoria. A lot of small traders for an unknown reason or impulsive attitude feel that the stock is just gonna move higher,and so they should enter at that level…………They can’t understand that it is the top position of the stock. Here the smart traders start to sell,and even manipulate the price to rise higher; and then start to sell. That is why,you will see bullish candle with very high volume at the top of price. But you will see that later,the stock seems to have lost strength and falling and falling…………..

Now if our V-spike gives green signals at the high of price,it tells us that we may see VC or climax situation. After the green signals,the indicator also will turn grey,which indicates more bearish scenario………….

Below is an example of VC in Aramit. See where that climax has happened-just at the resistance level with unusual volume. After that all indicators turned red or bearish………………

Remember the 500 crore day in DSE??? That was also VC day………..!!!!!

Volume Null/VN :

Now the indicator will tell us about another type of scenario where no significant volume is traded……….We sholudn’t bother about volume that is of little or no interest to us. For example,when the stock is falling,the volume of that fall doesn’t mean anything to us………..Our V-spike shows us that zone of null volume and thus shows us the way of better analysis……………..See the Null volume on the chart below………

Summary :

Well,this is all there is……………I hope this article will be helpful to ur analysis. Also,the indicator would help you,I hope…….Note that the indicator(V-spike) is no magic. It just hints us some directions,sometimes it can be wrong. But the good thing is that many times the indicator works nicely……………Whenever we see a spike,we need to try to understand what is going on behind that spike(Green or Grey) of our V-spike indicator..........I have attached the indicator below.Pls,download it,and load it in Amibroker.See if you find it useful.................!!!

THX!!!!

quark

quark

What happens when trading bets go wrong?
Posted on Monday, September 17, 2007 by sagecapital

I have been talking about many stock ideas that have been climbing up for past couple of weeks. Some of have gone up 20% and some 50%- from Titan to Rajesh Exports and Bartronics to Kirloskar!

Today I am taking a “stock idea’ which went really bad. The stock in question is “Deccan Chronicle”. The stock actually fell by 20% last week! So what did I do?

I had to sell the stock at a loss when it broke the 215 support levels. My entry was around 235 levels, so I had to take a 10% loss on my investment. At the same time, as the stock only formed around 3% of the portfolio, the actual loss on the portfolio level was just 0.3% (Didn’t I tell you that risk management is the key to success?)

This is what “investing is all about”. It is not about ” being right” but realizing when you are wrong! Imagine if I hadn’t gotten out of this position thinking that “this too shall rebound’ like many other stocks, how’d I be feeling today? I might have lost my peace of mind and it might have affected my ability to pick the next winners.

Trading is difficult because people find it impossible to “accept a loss”.If you go deeply it is all about accepting the fact that “you were wrong”.Now I have not seen many people who take it easy when someone tells them that they are wrong!They try their best to ‘defend” their opinions and actions.
Wins and losses are part of investment game. So every moment you have to deal with the possibility of “being wrong”. If you can’t deal with it, you end up hanging on to your losing positions till the time they become extremely painful!

Think over this and you might get “insights” into your trading patterns.

quark

Below is a video tutorial on Retracement trading with Fibonacci tool.

Fibonacci is a very important tool and Fibonacci ratio is very interesting thing to know………..

Fibonacci is used to measure how much pullback there could be when a stock is in correction after an uptrend…………..

After a stock goes up,it will stop somewhere and start to fall. And if we can know beforehand where the stock may stop its fall,then we can plan accordingly.

Fibonacci gives us some levels at which the stock price is likely to stop its fall. It is found that Stocks many times stop at Fibonacci levels. Not clear why. But this happens……….You can test it for yourself…………If you play with this tool,you will find that many times Price actually stops at Fibonacci level in pullback!

I have created three videos on Fibonacci trading. This is just an introductory video on how to use Fibo tool and measuring by it………….Each video has different purpose. Pls,watch each one………..

I created the videos in shockwave. Thus, the video files are small in size(only 1mb). AVI or WMA would have taken huge space, and the file would have got huge.That is why,I avoided those formates…………

You will need Flash Player to run the video. You should have Flash in your computer. It is a very important thing……….If your computer doesn’t have Flash, pls download it from the link below(1.50 mb only). And install it before watching the vidoes………..

Download the Flash player :

http://fpdownload.macromedia.com/get/fl ... player.exe

Download the Fibonnaci/Retracement trading videos :

http://www.4shared.com/file/69565445/f951c357/Retracement_Fibo_Tutorial_Video.html

Fibonacci works. It is not clear why.It works in every aspect of this universe. I tried the mathematical part. But couldn't comprehend that part. So,I gave up. However,there is no need to know the mathematical part. We just need to know where the price of a stock is likely to stop its fall...........And you may be surprised to see that many times prices do stop at Fibonacci levels............

Fibonacci is a tool to help us measure the likely retracement of a stock or index. Other things,if combined with this tool,will give us better prediction power. The good thing about Fibonacci is it is not a lagging tool. It is,unlike MA and oscillators,capable of predicting...............So,we need it. Candlestick is capable of predicting future,so is Fibonacci. So,when both are combined,we get a strong output.................

There are different strategy to use with Fibonacci. For example :

1. Fibonacci+candlestick buy/sell signals.
2. Fibonacci+moving average.
3. Fibonacci+Support/resistance
4. Fiboancci+Trading system signals.
5. Fiboancci+Volume..............and so on..............

We need to have defined strategy on each of the above. That way,our trading will be better and disciplined............!!!!

Hope you will like it.

Take care!!

quark

There are a lot of discretionary traders like Jessy livemore,Warren Buffet,Soros,Stephen Bigalow etc.............

Again,there is a lot of mechanical trader of modern age like Ed sekoyta,Richard Donchian,Turtle traders..........

Both groups are successful................

Mechanical Trading VS Discretionary Trading
By Shaun Rosenberg

Which one is the better system? These are two different ways to trade the stock market. They each have strengths and weaknesses. First let us examine the difference.

Mechanical trading is trading with set buy and sell signals. When the stock does this, and this, and this you have to buy. When it does that, and that ,and that you have to sell. This system should be back tested. You will want to make sure that the system actually works before trading with it.

Many traders will start off by using this system and then switch to a discretionary system once they gain market experiences. This system incorporates fundamental analysis as well as interpretation into a stock. They no longer set rules exactly but now combine rules with their expectation of the company itself.

Trading with a discretionary system has many strengths when compared to mechanical. Since it incorporates Fundamentals into trading A discretionary trader may already have insight to what a company is likely to do beyond what technicals will tell you. This gives the trader more vision when trading.

Another advantage it has is its ability to adapt to any market conditions relatively fast. This is untrue for other methods. While a mechanical system may work very well during an up trending market it may work terrible or even produce a loss during a sideways trending market. This could lead to delays. During these times you may experience a set of consecutive losses.

So does this mean that discretionary systems are better than mechanical? No, mechanical systems have many benefits. They can be just as profitable as discretionary systems can.

Mechanical systems are based on following strict rules and back testing. Any trader using this type of system should understand its greatness and its flaws. That is more than you can say for discretionary.

When you trade discretionary you do not know that your system will work for certain. There is no way to back test that type of trading. It could be that your way of trading doesn't work and you will not know it until you lose $1000s of dollars.

Another major reason why using mechanical systems can be great is that it takes the emotion out of trading. You simply buy when your rules tell you to and sell when your rues tell you to. A discretionary trader cannot do this.

Because they have no set of rules, they have to interpret the company to help them decide what to do. This could often lead to emotional trading which could result in losses.

There is no way to say that 1 system is better than another. They each have flaws and advantages. I will say this however. When you are starting off it is much better to start with a mechanical system. You do not have much market experience and as such will not be able to interpret company fundamentals.

Mechanical trading systems: a ray of light or a cavern of darkness?

There is a difference between happiness and wisdom:
he that thinks himself the happiest man is really so;
but he that thinks himself the wisest is generally the greatest fool.
Francis Bacon 1561-1626, British Philosopher, Essayist, Statesman

We have been lead to believe that mechanical systems and to some point fundamental analysis are the necessary skills to master in order to prevail in the markets. In an abstract way fundamental analysis is nothing but mechanical system in disguise; the data is put forth in a standard manner and so anyone can decipher it with almost no effort. Mechanical trading systems put forth a set of rules and all one has to do is follow these rules; in essence all the players become nothing but robots following a routine. The paradox theory comes into effect now; it basically states that one will get exactly the opposite of what one chases. We all know that at any given time the masses must lose in order to be able to feed the big players. That’s why the 90/10 ratio has almost seen no variation; 90% representing the percentage of losers and 10% the percentage of winners.

I could go on into great detail about why mechanical trading systems must and will fail and in the process put almost everyone to sleep. So in the interest of keeping you all awake I will keep it short and sweet. Let’s just pause for a second here and investigate the name “Mechanical.” One of the definitions by Merriam’s Webster online dictionary is “done as if by machine: seemingly uninfluenced by the mind or emotions”

Notice the key words here uninfluenced by the mind or emotions. First of all the market is nothing but a composition of a million minds so using a system that’s based on the rules set forth by one man’s mind and worse still devoid of any mental influence is a recipe for disaster. Secondly the market place is nothing but a sweat pool of emotions; lust, greed, power, hate, fear etc swirling through the markets like a hurricane descending on village of huts ready to decimate everything in sight. The above definition of the word mechanical is enough to make you want to run from any such system.

It’s virtually impossible for a mechanical system to last forever, since by design anything mechanical must and will break down at some given point in time. It’s rather amusing the terms we chose to represent the things we use or to define what side of the markets we are on. It’s almost as if we have nothing but a secret programmed desire to lose syndrome ingrained deep with our psyches. Bullish and bearish, we choose two of the most stupid, dumbest, irrational and easily angered animals to represent whether we think the market will go up and down. Then if we happen to be individuals that favour just one sector we come up with the term bugs as Internet bugs or gold bugs. Why such a disgusting animal to represent ones position and views. As we all know most humans react in an adverse way to bugs, the first thought that springs to mind is to crush them.

Even examining the language we use in the market places illustrates further psychological issues; scalp, plunge, up thrust, perfect bottom, down thrust, flip, climactic sell off, etc.

The worst part of all this is that we pass nothing new to the next generation. We simply reinforce these Neanderthal views, in fact branding them into the next generations memory more aptly describes the process. Is it any wonder then that we keep repeating the previous generation’s mistakes but do so in a much more grandiose manner? Just look at the speculative phase we have entered now (credit bubble, real estate bubble and so on) it makes all the mistakes our ancestors made pale in comparison. We leverage ourselves to the our necks with debt to buy goods we don’t need and use money we don’t have to pay for them; the real estate bubble is one classic example of madness and history repeating itself on a gigantic scale. Individuals take home equity loans against the rising values of their homes and use this to finance their extravagant lifestyles. Is there anything more insane, taking credit to buy something more on credit?

Anyway getting back to the topic at hand; no one is taught to look at the markets as a game and study the mass mind and behaviour of individuals and then learn how to use a few TA tools that are open to subjective interpretation. By subjective interpretation we are referring to the statement that “beauty lies in the eye of the beholder.” Each individual should see something different when using such an indicator; this TA tool must never be allowed to become standardized. If it is, the end is near. The ones that learn to correctly master this tool will come out ahead, however since the method is not available in a standardized format this system could work almost indefinitely.

In the end mechanical trading systems are reflective of our lifestyle and the way we are as group of individuals; the 9-5 rat race and the zombie like nation where everyone thinks and acts like one. A mechanical system is also reflective of the fact that most of us do not want to think, we want everything handed down to us and when we get whacked on the head we cry like babies. It is for this reason we never seem to learn from history but only look for ways to perpetuate the same mistakes on a flamboyant style. The only way to break from this way of thinking is to actually attempt to start thinking and using your mind. There is nothing wrong with making a mistake because you might actually learn something as a result of one; perpetuating someone else’s mistakes provides no clues for improvement but only rules for self-destruction.

At the very least some customization should be attempted so that the system is adapted to ones own needs. It amazes me that the easiest and most effective system in the world is not studied or followed more widely. The system I am referring to is trend analysis; all you do is spot a new trend and stay on board till the trend ends. Trend analysis involves the drawing of simple lines; it takes a little practice but is worth its weight in platinum.

So let’s look at what type of system can and will work in the markets. First of all one has to understand the difference between contrarian investing and investing based on Mass psychology. Contrarian investing is a very simple system as it basically involves taking a position against the masses. Mass psychology measures the frenzy periods or periods of extreme hate or disgust towards a specific sector or sectors, and then a position is taken during these extreme times. Furthermore it measures the level of euphoria in the camps of those that believe in the investment. In other words it will measure how many of the so-called contrarians are now extremely bullish and euphoric on a given sector. In most cases when a contrarian takes a position in a specific sector he is doing so as counter move to what the masses are doing. However the majority of the contrarians are still nervous and keep checking their positions rather frequently to make sure that at the very least the bottom is in. Once the sector starts to take off and produce returns they actually lose this nervousness and become very bullish; in other words they have now entered the euphoric phase. This is where mass psychology kicks in. At this point it will be time for the smart investor to bail out, you may not be selling at the top but you will be pretty close to it.

So understanding mass psychology is really an important and integral part of a trading system.

Second is to master several TA tools and make sure you do not use them in a standardized manner.

Thirdly you need to understand be patient and disciplined. You have to understand that sometimes you might have to wait for months on end before you can take a position, however you could be rewarded in weeks for your patience.

quark

2. Modified Heikin Ashi Chart :

3. My modified chart :

FOREX : Technical & Fundamental Analysis

Saturday, November 29, 2008

A must know for Beginners!!mrtq13

Tuesday, November 25, 2008

Something to give a thought!!:mrtq13

Saturday, November 15, 2008

How to detect reversal:a strategy:mrtq13

Wednesday, November 12, 2008

A discussion on INDEX:12 Nov 8.56 am:mrtq13

Tuesday, November 11, 2008

Technical indicators:mrtq13

Sunday, November 9, 2008

Success in trading is DISCIPLINE,MONEY MANAGEMENT AND TRADING SYSTEM:x-man

Saturday, November 8, 2008

Cites of Ed Seykota-a great trader:mrtq13

Jesse Livermore's Stock Trading Rules:mrtq13

Monday, November 3, 2008

Trading entry plan:mrtq13

Trading system development – The DUM method:mrtq13

Volume Analysis-a new approach!!!:mrtq13

Strategy of trading-averaging or stoploss:mrtq13

Why “buy and hold” strategy carries more risk?:mrtq13

Retracement trading with Fibonacci : Video Tutorial!!!:mrtq13

Sunday, November 2, 2008

Think like successful traders, trade what u see….not what u believe.!:mrtq13

Good rules to must follow!!:mrtq13

Review your trader mind!!!:mrtq13

World and Stock market is not chaotic:mrtq13

Intuition & mathmatical calculation:mrtq13

Modified chart...................:mrtq13