Posted By:- Thinking Boxx Team
July 10/2022 17;56 PM IST
There is no any best tool which you can use to earn profit in stock market. Best means it must fit in all charts but sorry to say there is no such tool which fits in. Its all about mindset, knowledge, psychology, experience and many other various things in which you should must focus to be able to make consistent profit..
If you ever find any best tool, tell me also. I also want to get rich…
Yes we can predict the market with some tools, its name is called “KNOWLEDGE”. This tool is really a good one to predict the market, upgrade your version of this tool so that you will be on a latest version. This tool can be an easily developed one. With free sources we can develop this tool.
A candle stick chart is most effective to use for stock market analysis as they make the relationship between the open, high, low, close prices very easy to read. With the help of candlestick charts one can search for various pattern formations to generate signals for price movement.
There are many technical analysis tools available that can be used by an investor in deciding the stock to be invested in and the price at which he should invest. Some of the most common tools are as follows:
- Trend lines - A trend line is a straight line that connects two or more price points and then extends into the future to act as an indicator of the further price movement.
- Support and Resistance - Support and resistance levels represent key junctures where the forces of demand and supply meet. Support occurs where a downtrend is expected to pause due to a concentration of demand which prevent the price from declining further. Resistance occurs where an uptrend is expected to pause due to concentration of supply which prevent the price from rising further.
- Chart patterns - A chart pattern is a specific formation of price on a chart that can be viewed as a trading signal, or as an indication of future price movements. Chart pattern analysis can be used to make short-term or long-term forecasts. The data can be intraday, daily, weekly or monthly and the patterns can be as short as one day or as long as many years.
- Indicators - There are various indicators used in technical analysis that can be used to generate buy and sell signals. Some of the most commonly used indicators includes moving average, relative strength index (RSI), moving average convergence-divergence (MACD), crossover, oscillators, etc.
Best stock prediction technique is that all stocks have a 52-week high and low and that in the long term the stock market has always gone up. The Dow Jones hit its all-time low in 1931 when it fell to 31 - today 87 years later its almost 26,000. Just in the last 8 years, the Dow Jones has risen from 6,500 to almost 26,000.
This prediction has always worked so what is a good investing method to take advantage of this? Well since stocks always go up and down I thought a contrary investing method that logically caused you to buy low and sell high would be the best way to invest. Here's an example of a great dip: in 2009 during the financial meltdown you could buy a share of American Express stock for $9 a share - today 8 years later a share of American Express sells for $99 a share!
And I found a great contrary investing method when I discovered Robert Lichello's Automatic Investing Management (AIM) method. His method keeps half of your investment in cash so you have money to buy when the stock market goes down.
Since an investing method is only useful if it is making high profits I made changes to the AIM method. I found that long-term options (LEAPS) on safe stocks like Dow Jones stocks worked very well - a 10 LEAPS portfolio of Dogs of the Dow stocks (10 Dow stocks with highest dividends is up 275% in 4 years or $60,000 has grown to $225,000 and half the profits are in cash.
This contrary investing method will work forever and loves big recessions and bear markets - in fact you will make a lot more profits long-term because of great buying opportunities during recessions when the herd goes crazy and sell emotionally.
Contact me to get my free investing book and free newsletter and learn a safe way to invest that will give you the future and retirement you want and deserve.
What are the chances of getting one face of coin you chose to come? I think 50% everytime.
But when you are not playing with a coin and is a fkin business.
Lets say Reliance. (1466)
What are the chances of it to go to 0 zero Or 2932? 50%? Do you think that there is 50% chance of it getting 0?
Ambani is the richest person of this country?
He has a monopoly of customer base in telecom in the whole world ( not country)
Joined hands with facebook( another monoploy in social media having managed watsapp too)
He has his gas business which should be under govt. But he has taken on lease for decades.
Has a plan ( announced) to come up with 5G.
Has a plan ( announced ) to come up with payment bank( like paytm and other)
Has a plan ( announced) to come up with JIO-MEET.
Has a plan ( announced) to make reliance debt free company this year.
So what are the chances of Reliance to become 0??? 50%?
Here you understood 50% chances.
Now what are the chances of this stock to break lower than 800( which wasnt breached due to corona?) Before 2932? A 50%? Again? Why?
Because all these announcements took place few days back.
9.9% stake held by facebook inc and all. Are you thinking that this company will be breaking its lowest with a 50% chance? Even then you saving 1466–666=800 and gain potential by 2932–1466= 1466…… 1466/666= more than 2 as you have investment risk of 666 only before price 800.
Now more than 2 means you need only 35% chances of being correct from here? To be in profits. But 2900 is a far target… and 800 is a difficult one for this perticular stock.
But in order to understand this answer you understood what?
The concept of Support. ( people are not expecting it to go lower and has a huge buyer base there)
With the concept of support we get stoploss like price 800 in this perticular scene.
The price of announcements we get additional edge to add to the chances of not losing our 666 and got a reason to be in this stock so we got the entry point. We saw the chances… we found out support n found our stoploss point first… then were in search of entry point so that if this turned out to be wrong… we face a little loss so searched a point as close as to be confirmed about a buy and also near support.
Now what is target? Lets leave this topic to be answered in some other question.
Answer to your question is: we never predict the market ( not the price it can/ may go to)
We just search a higher low( support ) stoploss anf near partial entry… then another part entry when we are profits… means price is moving in our direction…. Any thing better than 1: 5 will be keeping you in profits in long run… any thing better than 1:3 needs more focus and research always.
These are some topics we will keep on talking about.
I Hope you understood about things we dont know and why we dont need to is also observed.
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