Reality of Stock Market

Reality of the Stock Market

Majority of the traders fail because they do not understand the reality of the market.Most of us are not even playing the right game. Materials available over the net and the books written by failed traders teach technical analysis patterns and indicator based signals and we assume this is the reality.

The indicator based TA signals and price patterns are illusions. These are only effects. Cause is something else. Then what is the cause? Price .Indicators and patterns are derivatives of price. Then price is the cause and TA patterns the effect.So we need to focus on price.

Do not reach a conclusion so fast. Price is another effect and there is something that makes prices move in markets. What it is? It is the order flow. Orders make the market move. If the net order flow is on the buy side market will go up. If net order flow is on the sell side market will drift down.
Then order flow is the real thing that moves the market. Oh No .Dig a little deeper. Yes. It is the people who act in the market by feeding their orders. When people start bidding higher, price will move up when they start lowering their offers price will start moving down.

When people are going to bid or offer aggressively? It is when they feel the urgency and desperation to transact. This is when they become emotional. So it all comes down to the emotion of the market participants. Fear and greed are the most powerful emotions that can force people to act.If you are able to identify the price levels where a large enough group of traders succumb to these emotions and able to act there without hesitation, you will win in this game. Trading is nothing but engaging the other party. Encashing their fear and greed.

Suppose you are in a shopping mall People will be moving around in a random manner.Then you hear an announcement that the first ten purchasers of a particular item will get another free. You can see so many people rushing to that counter .That is greed in action. Then you go and press the fire alarm button. Everybody except you will rush to the exit. Fear in action.
Now you know it. Fear is much more powerful emotion than greed.

So at WiseMan we try to take these things in mind , understand the market , and teach the same to the people if you interested to learn trading ,

Personal trading Programme is going on and being taken by Chander Kant .if you interested you can whats app on this link – whatsapp

Comments

What makes you miss a winning trade ?

So we will talk about the things which have been holding you back in next few blogs coming in next months taking each specific problem at one time - 1. Cut winning trades short even though you know your trade setup is solid. 2. Failed to pull the trigger on a perfectly good trade because of fear of loss. 3. Let losing trades run hoping for a return to breakeven. 4. Added to a losing position in the hope that the market would turn around. 5. Made profits in the morning but gave them back in the afternoon. 6. Became more aggressive after losing money. 7. Took unplanned trades when the market suddenly moved. 8. Stopped trading or reduced position size after a loss. 9. Traded greater position size than prudent money management practice would advise 10. Held trades longer than they should have been held looking for a “home run.” 11. Failed to take a perfectly sound setup because the last two trades were losers. 12. After a day of big ...

The Greatest Trading Book – Ever!

If you‟ve noticed the small number of pages in this blog, you may suspect that this is not the Greatest Trading Book – Ever! And you‟d be correct. But don‟t worry; there‟s a simple explanation. This blog will explain exactly how you can create The Greatest Trading Book – Ever! You see, it‟s not a book you can buy. It‟s something you create. Let me explain…

Understanding Gaps in the market and trading them !!

Common Gaps Sometimes referred to as a trading gap or an area gap, the common gap is usually uneventful. In fact, they can be caused by a stock going ex-dividend when the trading volume is low. These gaps are common (get it?) and usually get filled fairly quickly. "Getting filled" means that the price action at a later time (few days to a few weeks) usually retraces at the least to the last day before the gap. This is also known as closing the gap. Here is a chart of two common gaps that have not been filled for while but now filled up . Notice that after the gap the prices have come down to at least the beginning of the gap? That is called closing or filling the gap. A common gap usually appears in a trading range or congestion area, and reinforces the apparent lack of interest in the stock at that time. Many times this is further exacerbated by low trading volume. Being aware of these types of gaps is good, but doubtful that they will produce a trading opportunities. Brea...

WiseMan Trading

Search This Blog