Saturday, April 30, 2011

Timely trading

How do you know the appropriate time?
First you must know: what affects the stock market in the long term? The answer lies in two words only (psychological factors) the fear and greed. In addition to news and rumors Fear leads to waves of selling shares, leading to the decline of the market and greed lead to waves of buying shares, thus increasing the market index.
Speculation and to achieve quick wins
Be very easy when you learn how to literally committed technical analysis and not subject to the psychological impact. Technical analysis will tell you how do you know the proper timing and you will know the signs of the sale or purchase of these signals appear to periods prior to the event is too short as it is to know these signs you should be the timing of your transactions are accurate and amazingly so that you can achieve the maximum profit possible.

Before you any process that must know what the market will do tomorrow; it will rise to buy today? To reduce or delay the procurement process? It is obvious that you want to buy at a low price and selling at a high price.

It is well known that the best time to buy is when the market index may experience declines in a row for several days or weeks so that may limit reached, which suggests that it is ready to rise as a result of a sense of dealers that prices had reached very low levels has come the time of purchase, and this limit is called your (bottom) in the dictionary of financial analysts.
What are the indicators or signs that suggest that the market has reached bottom?

First: a new low for the index as well as trading volume is low.
Second: when there is sadness, grief and pessimism among traders and expect a further decline.
Third: When the index near the bottom of the barrier already a major index that has historically reached and then reversed to the top, and you can see from the charts or, as Balhart of the index.
Fourth: Try the index rise by 1% or more, and certain trading volume significantly more than the day before.
Fifth: The onset of economic data is positive spark the market again.
When you receive all of these directories, be prepared for the start of procurement at the third or fourth day of the start of the market to rise on the bottom do not start on the first day so as not to be fooled by false elevation.
Why buy?
Does not abide by an arrow particular, but to see more sectors declined due to lower market and then from within the same sector to see more industries decline and then buy more shares drop due to lower market and not because of problems with the stock itself, it is known that most of the shares decline as a result of market pressure is the most increase at higher market. Shares of leading technology companies known for the strong performance of sales and profits is the first and surest of others, when the market rises.
Now that you buy you have completed 50% of the problem and the remaining 50% of the problem is the timing of the sale.
When to sell?
When you reach the value of the share to the price at which analysts believe it has become expensive and there is no rush to buy it through the graph (chart (up to a level known as the level of the upper barrier, also called resistance, a reduction that has already been reached by the stock price by, and reflected direction to the bottom, and at the same time there is a decrease in the size of the volume traded of the stock.
At the same time you are working on the timing of sales during the watchlist for the performance of the stock price should keep your focus on the performance of the market in general as well. May occur a sudden drop of your stock market index, while not up to the point of sale and thereby lowers the value of your stock from the market before it sells.

When the index drops?
When it reaches the market index to a level previously historically accessible then reversed to the bottom, and this level is called resistance, or up to a new level of height never reached before, and here we must be very careful as the market will do what is called a correction of prices in general so that paid for the sudden decline. This is the level at which a market begin the debugging process is called the summit.
What are the signs or signals to reach the summit, which will then begin the process of debugging and modifying the path of prices to bottom? First: access to a new level never reached before and at the same time there is an increase in the size of the traded volume of shares while the index rises by weak.
Second: when there is excessive optimism and greed of dealers and expect further increases.
Third: the onset of economic data is negative, which raises the fear and panic dealers.
IV: When all of these directories, be prepared for the sale and very quickly because the top of the market does not continue for more than a day or two.
Why in the event that the stock price dropped dramatically contrary to expectations?
In this case must be informed in advance by the loss can be borne, In general, if the stock fell by 7-8% for a purchase price of the sale immediately do not wait more than you can compensate for later in your operations to come, and must be Twqlm yourself to make your transactions moving with the direction of the market and not vice versa, you can not stand in front of a train coming very rapidly and tell him stop .. Should go in the other direction and you will only crushes and goes on his way.
At the same time you must know in advance what is the percentage of profit that is satisfied by, In general is a high 25% of the purchase price suitable for sale in case you do not know when will depend on the price rise.
The correct timing for the sale or purchase by the knowledge of the timing of the summit the market or the hall is 50% of the sale or purchase successful and profitable, but this does not mean you can not make a profit are excellent during the period between the top of the market hall, where enough to identify the levels previously for the index has historically that reversed then either up or down, so that procurement is at levels which will then be a reflection of the cursor to the top and sell at levels that will then be a reflection of the pointer to the bottom.
The remaining 50% of the timing of the purchase or sale depends on you personally and for your efforts and your perseverance and your efforts to get the information helpful, and the extent of your patience and your commitment to deep process of timing away from the control of psychological factors to take your decisions and your commitment to a clear strategy to fight the market, but were not a wolf lost your money.
Any financial market is not free from speculation to register strong gains in large and fast in light of economic and political variables, multiple, and may agree that the methods of many speculators not endless, but there are methods known in the market among them what is legitimate and some are misleading.


Misleading methods
* Recycling of large amounts of a company in order to mislead traders to force them to sell or enter in the purchase of an ill-considered.
* Applications strong "instantaneous" in failing companies without a real reason to motivate the new prices for the disposal of its shares.
* Rumor broadcast by the "large speculators" in the trading halls to achieve goals, either in buying or selling preferred shares in troubled companies, usually have their origin "is unclear."
* Offers "strong" companies to install the excellent prices for a long time for the purpose of collecting as much as possible before the issuance of stimulating news.
* Exploiting the system of "trading" in the case of the pre-opening prices are determined to impose on traders.
* The use of multiple names to mislead the market.
Legitimate methods
* Participation of the investor to buy or sell based on market mechanism.
* To engage in preferred shares and gains a good building exaggerated in the evaluation of market information is correct.
* Take advantage of quick decisions in light of news a surprise.
* Take advantage of the rule of "falling ball" according to Newton's third law (every action has a reaction equal in force and opposite him in the direction).
* Benefit from the forces of support and price barriers


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