Trading and Life

A brilliant Article from smellthecheeseblog.com from Avinash.

Its excellent work avinash. Astonished !!

www.smellthecheeseblog.com

Trading and Life …

Trading is a crucible of life: it distills, in a matter of minutes, the basic human challenge: the need to judge, plan, and seek values under conditions of risk and uncertainty. In mastering trading, we necessarily face and master ourselves. Very few arenas of life so immediately reward self-development–and punish its absence.

So many life lessons can be culled from trading and the markets:

1) Have a firm stop-loss point for all activities: jobs, relationships, and personal involvements. Successful people are successful because they cut their losing experiences short and ride winning experiences.

2) Diversification works well in life and markets. Multiple, non-correlated sources of fulfillment make it easier to take risks in any one facet of life.

3) In life as in markets, chance truly favors those who are prepared to benefit. Failing to plan truly is planning to fail.

4) Success in trading and life comes from knowing your edge, pressing it when you have the opportunity, and sitting back when that edge is no longer present.

5) Risks and rewards are always proportional. The latter, in life as in markets, requires prudent management of the former.

6) Happiness is the profit we harvest from life. All life’s activities should be periodically reviewed for their return on investment.

7) Embrace change: With volatility comes opportunity, as well as danger.

8) All trends and cycles come to an end. Who anticipates the future, profits.

9) The worst decisions, in life and markets, come from extremes: overconfidence and a lack of confidence.

10) A formula for success in life and finance: never hold an investment that you would not be willing to purchase afresh today.

Trading Resources

Here are the "must have" Trading resources :

• Ami quote ticker list



• Ami Quote v.1.9


• Amibroker v.4.9

Kelly's formulla for trade size

Win Probability			Kelly value
Win/Loss ratio			Math. expectation

For Long term investor !

Micro Inks looks on a critical stage.A classic case of beaten up company.

Story : Promoters sold their stake to a multinational company at 675 per share 7-8 months back.

After that, stock almost halved without any significant result apart from not so good results.

I suggest to keep a watch on this stock. Nothing much has changed after Huber chemical took over except top management.

Chart shows the downfall could be slow down at the region between 250-300.

I recommend to buy once it starts moving up above 300 for a long term investment.

BOJ interest rate ?!

I was reading an article(http://www.rediff.com/money/2006/jun/23ps.htm) on rediff posted by some stock broker showing how increase of interest rate by BOJ would affect indian market.
Here is my simple take on what could go away/

NSE mkt cap =1495329 cr
=332.2953 Billion $
Japanese funds =5 Bn. $(article says soros suggest this)
Proportion of Jap funds =2%

If BOJ interest sky rockets also then i wont be worrying as it can only affect directly by 2%.
Caution:This is simple calculation and i have not considered indirect affect (money flowing from Jap-->other country and then get invested into india).

Thougths ?

Ashok Leyland is expected to move up from current levels.

Reason : Strong MACD divergence seen and trend line support

Target : 42-44
Current market price =34
Holding period =15-20 days
Stop loss =31-32

Lets mint !!

ACC is forming Typical ascending Triangle pattern.
Along with that MACD is also moving above signal line.
Seems to be case of getting long entry at above 830-835 with
Tgt of at least 900 with strict stop at 790.

Thanks,
Ravi

Back in business !!

b



















Reliance looks interesting.
Watch out for 1030 level. That broken with volume and you see 960 next. Else go long and wait for 1140 with trailing stop at base trendline.

more trading ideas to come !!!!!! :-)

RP

FII activity

Guys,

Just have a look at the picture , only fools invest(long term) now.

 

Well that does not mean that you can not find an undervalued company , which is not in the radar of FII or MF.

 

Cheers,

Ravi

 

Dears,
Essar Oil has given a break-out with an ascending triangle.

Volumes are also convincing enough to suggest bullish undertone.

I recommend to buy into this stock with the stop at 47 on closing basis, with the target price of 63.

Cheers,
Ravi Pathak

Reliance Industries Ltd. 's Chart is showing interesting moves.

Adjusted prices to post demerger , are showing ascending triangle formation.

I would advice to go long on this with Stop at around 723-720. with the First Target of 755.

Regards,
Ravi 

Budget features

Guys,

The followings are some of the features of budget.

They are not exhaustive.More to come.

 

 

 

1. Companies allowed to file E returns by net

 

2. Golden Quadrilateral will be completed 96% by 2006 end

 

3. Rs. 3000 a year to a girl passing 8^th standard

 

4. Farmers to get short term credit at 7%

 

5. Old age pension raised to Rs. 200 per month

 

6. Small Cars to become cheap

 

7. Cigarettes to cost more by 5%

 

8. Steel to cost less by 7.5%

 

9. 1/6 scheme for filing returns abolished

 

10. No change in personal & corporate tax structure

 

11. Computers to cost more in terms of excise duty by 12%

 

12. Maruti Car cheaper by 23000

 

13. ATM operations under service tax coverage

 

14. FBT on tour & travel reduced to 5% form 20%

 

15. Transaction tax to continue

 

16. Excise duty on footwear to reduce by 16%

Regards,

Ravi

PNB Head and Shoulders

Hallo Friends,
Sorry for no postings these days.
But now you would hear from me frequently.

Amongst significant moves, PNB is creating Head and Shoulder Patter with neckline today broken.
I would advice people to go short on the with the stoploss at 443.
Target for this could well be 405-408.

The cache is that the bull market is still intact largely and no significant sign of reversal is there, so short positions may got hit by stoploss triggers,But keep strict stops to reduce the loss.

Thanks,
Ravi


 

SRF is starting to look attractive.It is forming Ascending triangle. Volumes also decreasing. My take is that little more riskier investor should get in Long right now. Safe bet would be to wait for a break out from 296-300 Level. From where the stock can see 50 Rs. Upside. In any case have your stop at around 280. Check volumes also during the break-out.Thanx, Ravi

Ravi Pathak

Infosys Tech is creating a rising wedge and there are signs of reversal. Volumes are reducing.Divergense also shows negative trend.Besides,Bollinger Bands are extremely narrow. My Take is to create a short position from hereon the reversal would get confirmed as it breaches,2960.One can even wait to create position till that level. Also have a strict stop at 3027.If it breaches then a Long can be taken.

Ravi Pathak