Stock Market and Traders

A few days ago, I shared this story on my Facebook page. But read till the end for a meaningful takeaway.

Once upon a time in a village, a man announced he would buy monkeys for Rs 10. The villagers, seeing many monkeys, went to catch them. As the supply decreased, he increased the price to Rs 20, then to Rs 25, and eventually to Rs 50. The villagers caught monkeys eagerly, but soon, the man’s assistant appeared, offering to sell them monkeys at Rs 35, promising they could sell to the man for Rs 50. The villagers, using their savings, bought the monkeys—but the man and his assistant vanished, leaving the villagers stuck with monkeys everywhere.

This is how the stock market works today. If you're still in the market, you're likely recovering your losses because you're holding onto non-performing stocks, hoping someone will buy them at higher prices. The man won’t return. He’s now fooling others in another village, and if he comes back, it’ll be for donkeys, not monkeys. You’ll probably make the same mistake again.

Can we change this system?

Unfortunately, as a common trader, we can’t directly change it. But we can fight back by becoming smarter. How? By following the strategies of the man and his agent in the story.

You don’t need to become friends with them, but you must observe and follow their actions. In the market, they won’t make announcements, but here’s what you can do:

• Get involved and develop an interest in the market.
• Stay positive and maintain a winning attitude.
• Learn technical analysis. This will help you understand the man’s strategy and guide your actions.
• Don’t rely solely on news, but don’t ignore it either—news often comes from agents.

Stay tuned for more insights on technicals and their implementation on YouTrader in upcoming blogs.

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What Are Stocks & Technical Stock Analysis?

Plain and simple, stock is a share in the ownership of a company. Whether you say shares, equity, securities or stock, it all means the same thing.  The Holding a company's stock means that you are one of the many owners (shareholders) of a company. A stock is represented by a stock certificate. In today's computer age, you won't actually get to see this document because your brokerage keeps these records electronically in your demat account. This is done to make the shares easier to trade. The importance of stock ownership is your claim on assets and earnings. Without this, the stock wouldn't be worth the paper it's printed on. But almost the traders today buy it for appreciation of values in market.

How would you know the value will be appreciated or depreciated?  There are two things you can predict, Fundamental Analysis and Technical Analysis.

I don’t talk much about fundamental analysis here. As a common trader and poor knowledge about fundamentals, we can’t predict price movement based on published financials. But we can quickly learn the Technical Analysis and can apply that in our day to day trading.

Technical analysis is a method of evaluating securities by analyzing the statistics generated by market activity, such as past prices and volume. Technical analysts do not attempt to measure a security's intrinsic value, but instead use charts and other tools to identify patterns that can suggest future activity. So technical analysis looks at the price movement of a security and uses this data to predict its future price movements. Using technical analysis you can predict small, medium and large price movement.

Every technical analyst has its own methods to analysis. There are thousands of indicators to analyze but practically it’s impossible to apply all one together. We should stick with specific indicators in day to day trading.

YouTrader provides following technical indicators

Pivot, MACD, Moving Averages, Exponential Moving Averages, RSI, Slow Stochastic Oscillator

These are all available in interval of 2MIN, 5MIN, 30MIN, Daily and Weekly.

I will post all the details about these indicators and how those are applied in YouTrader in coming blogs.

Happy Reading….

What is YouTrader?

Usually peoples download YouTrader and ask me first question, what is YouTrader? Many times it’s hard for me to explain about YouTrader. Four and half years ago I developed small tool in Microsoft Office Excel for my trading and never thought this would take this shape in future. What I just wanted initially to have live prices in Excel so I can put my formulas in other cells to do some kind of analysis. And that’s all, this started with Excel and latter shifted the whole things in Windows application for faster execution. So my first answer to the question is that YouTrader is windows application that run on Windows XP and latter. It should work on earlier windows versions as well but never tried.

OK you have the first answer and second answer is already hidden above. It is Stocks Analysis tool where you can analyze the stocks to find the current trend of the stock using different technical available in YouTrader. I am sure I will describe all those technical details in coming blogs. But before discussing technical, I would like to blog about the stock market, trader and their relationship with real life that I experienced in Stock Market. Without understanding this there is no meaning how you use technical and trading stocks. So let’s start from the base and wait for my next blog “Stock Market and Trader”

Happy Reading…