Trader maker

There is a big difference between an Investor and an intra-day Trader. Investor  always seek for the right company and the right opportunity to invest on . Investors gives times and waits patiently for return of  investment. On the contrary, Traders search opportunity to grab the money out of the market everyday. To do the same, Traders only look for the price of the stock, Price movement , volatility and of course liquidity. Mostly there are  three kinds of traders,  Swing Trader,  intra-day trader and  Scalper. Swing traders use mainly daily technical charts, indicators and focuses on the news of a particular stocks. Average trading duration of a swing trading is 3 weeks to 2 months. The ROI of a Swing Trade is 10-20% on average of a trade. Intraday traders  use technical charts based on 5 min or 15 minutes and check the support and resistance level of any stocks, accordingly take the trade. The target of any intraday traders varies from 1% to 3 % a ...

There are three different phases of any successful day trader’s life. Every successful day traders have followed the same path and became successful. All these three phases are followed by an idle phase. let me explain it ...... Phase-1: Phase one is the most excitement phase. In this phase a trader starts his trading journey with no or limited knowledge. Takes trade blindly or someone's recommendation. makes a few profits and a Hugh loss in the market. Remember that maximum number of traders enters into the market during a bull run. This time almost every alternative day market creates a new high.  During this phase he believes on market gurus, friends, recommendation providers, news anchors etc. This time the trader thinks he will be able to make hell lot of money and he is the smartest person on the market. But his believes turned into a nightmare when the market starts consolidating and gives a little pull back. Noe the nightmare becomes darker day by day and he thinks that he ...

 Have you ever seen the video of a sea where a whale is chasing a bunch of small fishes and the fishes are organised in such a way that it looks like a giant fish?  Have you ever seen thousands of insects are flying and forming a big cloud like structure and attacks on the farmer's crop? Have you ever seen many small birds are flying all together and moving like a giant in the sky? I guess you have seen those in the nature if not in National geography of course. The beauty of togetherness and moving  always gives strength. Similarly in stock markets the bulls and bears when accumulate at a certain price they have the power to move the market in their own direction. That always happens. With the above analogy what I tried to explain is, we are all human and reacting to wards the price in any asset class, always go with our nature and psychology. We repeat ourselves every-times and our reactions are always same. Historically if you try to follow the chart patterns it always...

All profitable trader follows a strong money management rule. Nowadays most of the traders think that money management means Risk to reward ratio only. But money management actually having a lot of components including Risk to reward ratio. If a trader does not follow a strong money management rule, he cannot grow his money in a significant way. Money management have the following components. 1. Capital allocation for different type of trading (intraday, swing and investment) 2. Account size or Total capital.  3. Risk per trade. 4. Position sizing. 5. Increasing the position sizing. 6. Incremental buying or selling (Pyramiding) 7.  Leverage for the Trading system. If you understand the above seven money management rules, and if you can implement it correctly, I think you will become profitable sooner or later and which will make you wealthy eventually. 1. Capital allocation for different type of trading (intraday, swing and investment):   Many traders th...

The easiest way to make money from trading is easy money capturing strategy. You may already know that the market is mostly volatile, unpredictive and sometime trending in nature. Most of the traders try to capture money form the market most frequently and without doing the analysis, that’s actually makes them too loose more money in the market. However, trading is all about waiting for the right time to take the right trade. 80% of the time you just have to seat calm and just to watch the market so that when you get any opportunity, you can capture that and make as much as money you can. Most of the Traders try to capture money from all kinds of market, in my opinion it is not correct. Firstly, you need to understand the nature of the market first and the day (if you are doing an intraday trading). The nature of the market depends on the geo political situation and the financial stability and last year/month and days performance as well. All the markets are connected from investors ...

The biggest mistake any intraday traders commits during its initial journey is to attached with a specific stock or to become egoistic with it. Either in the cases traders loses their money. Let me explain with an example. Suppose a Trader has bought a stock at a certain price and after his buying he has fixed a stop loss in his mind. Now when the stock just near to stop loss price, it formed an interesting pattern in candle stick. Now the trader is thinking of a reversal and he just changed the stop loss a few points lower. There might be a possibility that after a certain retracement the stock might fall lower.  Sometimes traders do not put a stop loss in the system but in mind and changes the same after a while when he is in loss. Sometimes traders just wait for a reversal and fight with market hoping and praying for its buying price. Even if it comes to a buying price, they change their mind and wait for a while hoping for a profit.  Hope does not work in stock marke...

There is a wrong belief that if someone starts trading, he/she will be profitable from the very first trade. Most of the traders thinks so, but the reality gives them the big hit and realizes that the truth is far away from their expectation. Every year 2 million new traders starts their journey in stock markets but after spending 2 years, 98% of them quits after losing their hard-earned money.  The larger people quits just because they have wrong expectation from stock market. Of course, it is true that stock market is the ocean of money, but earning from the stock market regularly needs special attention, proper education and experience. Remember that it is the most sophisticated profession. If the right techniques are mastered you can earn from anywhere, anytime and you will achieve financial freedom. To achieve financial freedom, you need to go a long way. Remember that, Stock market is not a destination but a journey. You should choose the smoothest path, such a way that y...

I always compare Trading as a war, like war, trading has an emotional and psychological situation. In a war there is a fear of losing life or everything and greed to win it over, as a brave man. The same is applied in trading it is 7 hours war a day with a few battles. If you are in the winning side, you will get rewarded but if you are in the losing side, you will be punished. To win a war you should have a better strategy, few weapons and a master-plan. But always remember that you are not going to win all the battle in a war, there will be few battles where you have to accept your defeat. The quicker you will realize your mistake and accept your defeat you are going to lose the lesser, and you will get much time to prepare for the next one. To win a war every participant has some weapon, no solider believe on a single weapon. For example, in modern war, people use, riffle, AK47, Tanks, missile, hand grenade Drone etc. Similarly, as a Trader you should not believe on a single strat...

Many Traders in stock market think that Intra-day trading is a source of regular quick money, however, most of the people, especially investors and swing traders believes that, money can be ruined by intra-day trading. The problem is mindset, you can be an investor, swing trader or a day trader, you have to have a different kind of mind set for each of the category. Category is not the problem, mindset is. If you really want to be a successful trader, you should take trading as a business. Profit and loss are the integral part of any business, the same is applied in stock market as well. let’s take a hypothetical situation that you are going to set a business. What are the points you need to take care? Out of thousand points few basic points are mentioning herewith; Business establishment capital, Operating capital, Location of the business, employee, Product, Knowledge on the business or how to make profit from that business (business model), Journal, Tax calculation, customer etc. ...

When a Trader starts trading, he only believes on the indicators. Almost all the unsuccessful traders use one or many indicators in combination. SMA, DMA, RSI, MACD, Bollinger Bands, VWAP, Stochastic etc are most commonly used indicators in the market. Many novice traders believes that 20 SMA and 200 SMA cut over is a best signal, some believes that 80 RSI point is overbought position and 20 is oversold position. Some believes that exceeding Bollinger band is a best signal. Some of the traders uses a few indicators in combination to identified the best signal. Sometimes they are successful to trade on those trading systems but in the long run they fail to make profit using those indicators.  The reality of any indicators is same and that is, all the indicators are mathematical formula of its historical prices. The indicating points are just the derivative of the recent past prices with some visual effects. If you are believing on those visuals .... best of luck. Do you really...

Every trader often faces a common problem that they regret about their exit price. after exiting the trade, the stock has started another rally and traders regret why they have exited from the stock. Many veteran traders have faced the same issue.  Almost all the traders want to buy at a lowest price and sell at a highest price. Traders argue that buying at lowest price could be treated as risk as the trend reversal has not started yet and there is no confirmation that there will be a reversal after that price. Agreed....... But what about the selling? How do you identify the highest price to sell? Some traders believe that you cannot take the whole rally and make an extremely good profit. Accept whatever you are getting from the market and be thankful. That's okay.... Now, the question is at which price we can sell? Before selling any stock in intraday, you just need to check the following points. Nearest exponential pivot point. Nearest round figure of the price. ...

Psychology plays a great role in day trading. Everyone wants to buy at low and sell at high and to capture the upward or the downward moment fully to get the maximum profit. But only two types of persons can execute the trade properly, one is GOD and the other is the liar. It is really impossible for anyone pick a stock at bottom and sell at top. However, most of the traders fails and blame their psychology.   Another one scenario is stop loss management, while providing stop loss, most of the time after hitting the stop loss the stocks move on the right direction. Mentioned points makes mad any trader specially on the initial days. Stop loss management is a different topic. However, I am explaining the psychology of a trader in this topic.   Let’s take an example of a hunter who is having a sniper in his hand and trying to shoot an object. Now to be successful hunter, he has to practice a lot and has to be knowledgeable enough to handle a sniper. If he is not so, he will ...

Habits define a person and his behavior. Personality and behavior is an important factor of a successful trader. A mental balance and calmness is the key factor of any successful trade. Just imagine, the mental state of yours when you are in the trade. when the price is closer to your stop loss, the intensity of your pray to god become higher. Image the regret  when the price moves faster after hitting your target price. Fear, losses, greediness or profits always effects your mental state of your next move as well. After hitting a consecutive 4 profits in a row makes you more confident to overconfident and a consecutive 3 losses in a row can put yourself in darkness. These are the two sides of a single coin. In this mental, emotional and psychological blockages you can overcome by having few good Habits.  Be an early riser. Do some exercise, yoga or at least breathing exercise. Read a business newspaper every morning. Evaluate the speculation and the news from the news headlin...

The most popular question of any Intraday trader is how to select  stocks for trading in a particular day. Many of the Traders believes that they need to select the stocks which will have maximum possibilities to provide upside or downside on a particular day.  As per me, it is very difficult to predict or to choose the most movable stocks on intra-day basis as because you have to relay on the news and the speculation for such an approach which can be venerable. However most of professional do it on the other way. In this context I will describe the process I follow. You will agree with me that we should select the stocks which will have most liquidity and most of the players attention. I always prefer index stocks on the same. My approach is that , we need to chase six to eight particular stocks on regular basis to understand the nature of the stock, Byers and sellers activities, pattern they are forming, time to trade those stocks and its behavior.  You should take the ...