Archives of “January 13, 2019” day

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Accept Responsibility For Your Actions!

  
  Education
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Accept ResponsibilityWhether you win or lose, you are responsible for your own results. Even if you lost on your broker’s tip, an advisory service recommendation, or a bad signal from the system you bought, you are responsible because you made the decision to listen and act. I have never met a successful trader who blamed others for his losses.

RBI-Tough time for errant borrowers

  
Analysis, Education

Bankers will now be able to toss out errant promoters and grab majority control of companies that fail to pay back loans under the new debt recast rules notified today by the Reserve Bank of India.

The new rules that will effectively put bankers in charge of willful loan-defaulting companies form part of the strategic debt restructuring scheme (SDR) that was notified in February, which is underpinned by the general principle that “shareholders (should) bear the first loss rather than the debt holders”.

Under the new rules, lending banks will be able to hunker down and “convert the whole or part of the loan and interest outstanding into equity shares in the borrower company so as to acquire majority shareholding in the company”. (more…)

A financial glossary

  
Analysis, Education
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BANK, n. Bottomless cavity in the ground that sucks in money and the unwary.
I had quite a bit of money but then I put it in the bank.

BOND, n. A profitless contrivance used for catching the gullible or feeble-minded.
That pension fund is 100% in bonds now.

BROKER, adj. A comparative descriptive state for a client of a Wall Street bank.
He didn’t  exactly have a lot of money before he started dealing with Goldman Sachs. Now he’s even
broker.

BUBBLE, n. Fundamental prerequisite for a functioning Anglo-Saxon economy.
We need a new bubble to replace the ones we had in dotcom and property.

CENTRAL BANK, n. Lobbyist for commercial banks well versed in alchemy. (more…)

7 Points for Traders

  
  Education
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  1. You don’t choose the stock market; it chooses you.  A little bit of early trading success can have a profound effect on a person’s soul.  If it does choose you, you’ll have to accept that your life and investing will become forever connected.
  2. Your methodology must provide an unshakeable foundation that you believe in totally, and you must have the conviction to trade based upon it.   If your belief is tentative or if you don’t have complete faith in your methodology, then a few bad trades will destabilize and erode your confidence. 
  3. A calm mindset that can focus on the execution and not on the outcome is what produces profits.  It takes total emotional control.  You must maintain your balance, rhythm and patience.  You need all three to stay in the game.
  4. The markets are always conniving with ingenious techniques to get you to lose your patience, to get you frustrated or mad, to bait you to do the wrong thing when you know you shouldn’t.  A champion doesn’t allow the markets to get under his skin and take him out of his game.
  5. Like a great painting, all good trades start with a blank canvas.  Winning traders first paint the trade in their mind’s eye so that their emotional selves can reproduce it accurately with clarity and consistency, void of emotions as they play it out in the markets. (more…)

High Probability Trading with the Trend,Must Read These 21 points

  
  Education
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1. Know what the trend is.
2. The best trades are made in the direction of the trend.
3. Use multiple time frames to get the overall picture of the market.
4. Assume that the main trendline or moving average will hold
5. The smaller the slope of the trendline is, the more reliable it is.
6. The longer the moving average is, the better it defines the trend.
7. Wait for the pullback
8. Don’t chase the market.
9. Don’t fight the market.
10. Even in the strongest trends there should be some retracement
11. The closer the market is to the trendline, the better the risk/reward ratio is
12. Keep it simple
13. Look for the end of a trend when the last wave doesn’t reach the channel line or the previous move.
14. Use ADX to determine the strength of the trend.
15. Hold trades longer in a strong trend.
16. When getting out in anticipation of a retracement, do not reverse a position.
17. Wait for confirmation of a trendline breaking before reversing position.
18. Watch for bubbles between moving averages.
19. Know where the Fibonacci retracements levels are.
20. Place stops outside retracement levels.
21. Estimate how much the market can move.

The Flow Of Money Explained

  
  Education
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Money and investment capital are very picky things. They are constantly flowing from those who know how to manage it, to those who do not. Money is not static, it is in constant flux. This is why a person that starts out poor in America can end up wealthy, and also why generational wealth can dissolve in one generation due to bad management. The flow of money is why a lottery winner that wins a jackpot and does not know how to manage it can quickly find themselves in bankruptcy. No amount of money will overcome consistently bad decisions. In a free market, capitalistic system, money flows continually to those that create value and away from those who do not.

  • Money leaves those who risk it’s loss too many times, and ends up with those that protect it and make it grow.
  • Money flows from consumers of goods and services to the owners of the businesses that provide the right products.
  • Money flows to entrepreneurs when they create desirable goods and services. Money flows away from consumers that do not have self control.
  • Money flows to employees that develop skills that employers will pay a premium for. Little money flows to employees that lack skills, or the work ethic to attain them.
  • Money flows from customers to businesses.
  • Money flows to innovators and away from outdated, stagnant businesses.
  • Money flows to well managed businesses and away from mismanaged ones.
  • Money flows from bad traders to good traders.

Psychology Vs. Adaptation

  
  Education
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The biggest question I have here is when do you ‘adapt’ and when do you stick with your trading strategy.

We do not know whether our strategies truly work… how do we know if we have just been ‘lucky’ verses by ‘smart’. (more…)

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