TRADING STRATEGY

Buy low, sell high. Short high, cover low. Traders are like surfers,
trying to catch good waves, only their beach is rocky, not sandy.
Professionals wait for opportunities but amateurs jump in, driven by
emotions—they keep buying strength and selling weakness, bleeding
their equity into the markets. Buy low, sell high sounds like a simple
rule, but greed and fear can override the best intentions.
A professional waits for familiar patterns to emerge from the market.
He may notice a new trend with rising momentum, indicating higher
prices ahead. Or he may detect the feebleness of momentum during a
rally, indicating weakness. Once he recognizes a pattern, he puts on
a trade. He has a clear notion of how he’ll get in, where he’ll take profits,
and where he’ll accept a loss if the market turns against him.
A trade is a bet on a price change, but there is a paradox. Each price
reflects the latest consensus of value of market participants. Putting on
a trade challenges that consensus. A buyer disagrees with the collective
wisdom by saying the market is underpriced. A seller disagrees with the
wisdom of the entire group, believing the market is overpriced. Both
the buyer and the seller expect the consensus to change, but meanwhile
they defy the market. That market includes some of the most brilliant
minds and some of the deepest pockets on Earth. Arguing with this
group is dangerous business, and it has to be done very cautiously.
An intelligent trader looks for holes in the efficient market theory.
He scans the market for brief periods of inefficiency. When the crowd
is gripped by greed, the newcomers jump in and load up on stocks.
When falling prices squeeze the fingers of thousands of buyers, they
dump their holdings in a panic, disregarding fundamental values. Those
episodes of emotional behavior dilute the cold efficiency of the market,
creating opportunities for disciplined traders. When markets are
calm and efficient, trading becomes a crapshoot, with commissions and
slippage worsening the odds.
Crowd mentality changes slowly, and price patterns recur, albeit
with variations. Emotional swings provide trading opportunities, while
efficient markets chop up and down, offering no edge to traders, only
piling up their costs. Technical analysis tools will work for you only if
you have the discipline to wait for patterns to emerge. Professionals
trade only when markets offer them special advantages.

CENTURY TEXTILE

334-335 the next resistance for century textile
cheers
rish

TRADING FLEXIBILITY

Markets keep changing, and flexibility is the name of the game. A
brilliant programmer told me recently that he kept losing money but
whoever was buying off of his stops must have been profitable because
his stops kept nailing the bottoms of declines. I asked why he didn’t
start placing his buy orders where he now placed stops. He wouldn’t
do it because he was too rigid, and for him buy orders were buy orders
and stops were stops. A high level of education can be a handicap in
trading. Brian Monieson, a noted Chicago trader, once said in an interview,
“I have a Ph.D. in mathematics and a background in cybernetics,
but I was able to overcome those disadvantages and make money.”
Many professional people are preoccupied with being right. Engineers
believe that everything can be calculated, and doctors believe that if
they run enough tests, they’ll come up with the right diagnosis and
treatment. Curing a patient involves a lot more than precision. It is a
running joke how many doctors and lawyers lose money in the markets.
Why? Certainly not for lack of intelligence, but for lack of humility
and flexibility.
Markets operate in an atmosphere of uncertainty. Trading signals are
clear in the middle of the chart, but as you get closer to the right edge,
you find yourself in what John Keegan, the great military historian,
called “the fog of war.” There is no certainty, only odds. Here you have
two goals—to make money and to learn. Win or lose, you have to gain
knowledge from a trade in order to be a better trader tomorrow. Scan
your fundamental information, read technical signals, implement your
rules of money management and risk control.
COURTESY:-come into my trading room

BOMBAY DYEING

bombay dyeing resistance near 525-530 crossing that can see 600 levels
cheers
rish