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ALL TRADERS – HOT TIPS FOR TRADING


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True information is money to those who know how to use it. I thought i share some of my experiences with you to help you, all free, here! I had my share of being made wrong by the markets. Never underestimate the market. And don't enter at random points. If you are going to trade then understand technical analysis, and chart patterns.

For many traders, scrubbers, swing, daily and longer term traders many either work in the financial field or belong to some type of technical charting service and so have some angle to trading success.

However, non-professional traders and the novice have many hurdles to handle on a regular basis.

So what is the thing to bear in mind prior to trading? After all you have to know your game, the environment you operate in.

Generally you may consider:

  • The economic factors
  • The geo-politics
  • Newspaper tips (not really good)
  • Company fundamentals
  • Technical charting methods.
  • Subscription services
  • Brokers advice

Well, I could add a few others but it points to the the appearance of too much information if all are used. Which is correct or best at the time?

Answer:

In a well defined bull market you cannot go wrong, most are going up. Most factors will be rationalised as being positive! Vice versa for the bear market.

The media tips are often not worth it at all. Fundamentals are ok in the bull phase. Charting, if used correctly, gives a good way to trade in a bull or a bear market.

Brokers and analysts will tell you all is fine even when a bear has began. “buy on dips will remain their mantra, it will always remain the case to them.

Subscription services, some have a great win rate, others not so.

The rest of the points above are a fleeting knee-**** reactions at the time.

Beware of the big players and the market makers, in bull & bear markets.

They have all the data, trades taking place, in & out. Professionals go after positions opened by retail traders or others. Say you buy, the market trader sells it to someone – that someone is betting against you, often a bigger bet.

You may notice this quickly on short term trading easily as the price often moves against you to get your stop loss or to flush you out at a loss before it moves in the original direction. And the last hour of trading is riskier to trade in, as the market makers control that period and give false signals. It is observable with several different indices , e.g. Dow, s&p500, and japan225 move in similar copy moves, similar patterns, often – as happened on 28 June 2022. It does not happen by chance.

Professional big bets often do not go via the normal exchange. The public traders do not see that part easily.

Market makers cater for their big clients and are more important to their bread & butter. So a big client sells or buys means getting an average sell / buy price to meet the client's required total volume transaction needs. It is done bit by bit, usually otherwise the price will go down or up hard if all was sold or bought at once. Rest of the market will try to catch that.

Pension funds, trust funds, and long term investors invest using fundamentals analysis for long term gain. All fine in a bull market, but fall victim in bears and their operating rules are inflexible. Besides they all like herd thinking ( same behaviour ), that's bad practice. That makes them give poorer returns, overall.

So when is a bear a bear?

Technical definition used is a 20% fall of the underlying. Mostly you get recessions and the big ones are depressions (bigger effects).

But the signs are there well before, using certain metrics.

In the final stage of a bull market all sorts of stocks shoot up way beyond their rational worth. Tons of hype and buy any stock “will make money” craze is present. And for a short while they do. ( another honey for the bear trap to come, for the uninitiated).

In a bear market, it unfolds slowly to start with. There is great volatility, often. Much of this volatility is the selling action of actual underlying shares then others are pushed up. You only look at the overall market index and see it go down, then up. It plays out over months. The big boys are getting out and getting others in with PR from the brokers, newspapers, media, and key individuals. Honey for the bear trap.

Hence it is not a market where all win. It isn't called a zero-sum game for nothing. Most investors realise this too late or, go on holding in hope.

Individual stocks, good and the ****, go down 50%, 75% or more. This has already happened in many stocks. Do your home work and check. The big stocks like the fang go down last as they hold up the average index price higher.

The mainstream PR is that all is either fine or will be “normalised”. They miss-evaluate the current scene. Garbage data used gives garbage results out. The general public relies on this message to maintain their investments.

The politician, as usual, is ignorant and relies on false or misleading information from the so called “experts” in these fields. It could be that these “experts” have, as in the past cases, just miss-evaluated and passed on bad information to act on, and given their own “solutions” for the problem down the road. And here we all are, again!!! What did they “solve” in the past?

After all, when you solve something it is no longer going to crop up as a problem again and again. Its fixed, cured. So, did we ever get that? No.

In the worst part of the initial stage all hell breaks lose. Panic in the markets. Bad news in the media. In the mid and late stages chant of a doomsday scenarios; fear, fear, and more fear is plied into the psyche via the media.

Politicians panic and a public outcry.

Central banks wait in the wings to give their (incorrect) “solutions”. Tax-write off for companies (fixed in law), subsidies for companies and banks, and more qe to “offset” the banking system calamities arising. The poor public gets nothing (and no tax write offs!) And have to pay for all these “pay-outs” via further covert taxes to come, and the loss of their investments and real estate value. You pay for their created, irresponsible mess due to over leverage positions (trillions) and bad analysis. They will give justifications of that war or this geo-political incident, etc... Being the causes but the primary cause will still be missed out.

They will not say we'll write-off our own bad debts and mess, shoulder the responsibility and go bankrupt if that applies (which they should).

Instead they put fear into the politicians or that it will all collapse. The politician remains afraid of losing votes, and no clue how to really solve the problems correctly, they depend on "experts".

The burst would clear up faster if the bankrupt companies and banks are closed. The government should really “save” only all the depositors in a new entity, and that will then be run by new individuals with a past successful track in the field. Later on the government can sell it at a good profit.

After all, you wouldn't want to keep employing incompetent or consistently bad performers in your employ??? Or, would you?

New world agreement type solutions that will be put forward later on will not really solve the underlying economic issues as they will not have been addressed, nor identified and handled.

Realise this: central bankers everywhere are using a theory based economic science ( currently it is monetary theory ). An exact science the other hand would solve things genuinely

To get a good perspective on inflation, deflation, money supply, central bankers, the fed, and more then see my other blogs to gain further understanding of our game's environment and how it was shaped.

 

 

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