It’s been a while since I last posted here at my blog. I had been pre-occupied with some work earlier and since last one week I had been observing the markets and was away from trading heavily intraday and had totally stopped swing trades because I wasnt comfortable trading my own style of dual positions of long and shorts because there were no buying sign.
Today, I did get the opportunity to buy some quality stocks and I had been very lucky with it and the markets have been kind.
I was at 100% cash on Wednesday, and had deployed 30% of the capital on Thursday (12/03/2020) and put in 50% more today (13/3/2020). Now, I am left with 20% cash for mostly hedging or buying the further dip.
There is less chance of us visiting the low of today of 8555 at nifty the recovery volume was very very healthy. But again there is indeed a chance.
Probability of hitting the low of today should exponentially decrease after this month. If we are to re-test those levels it should be within this month.
As I earlier said Technical Analysis had stopped working a few weeks ago and now that the markets have cleansed out most of the traders TA should be back again working soon.
Below is the screen shot of the stocks I bought and at what price.
Well we all know the Buffet quote, “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”. Everybody quotes Mr. Buffet all the time but what I learned today is that hardly anybody have the guts to actually be greedy at times such as now.
In the book, Reminiscence of a stock operator, Livermore had clearly said when everybody is fearful or just waiting to buy, know its time for a bottom. And for this very reason I did ask more than a dozens of pro traders about their market view and all of them were saying it is going to go further down and nobody was buying, so I just went according to Livermore 😛
Well, this was a mix of luck and quick thinking.
SO, What to do if you’ve missed the Train?
Most of the people who bought have bought it at 9500-9700 Nifty range and their pain will begin once those levels are tested again. And because of this I feel we might see some panic sells.
So, nothing to worry you will again get the opportunity to buy the safe investments.
The left chart shows the 1 Min recovery which was very strong and the chart at the right shows BULLISH Engulfing.
The half of this candle could be retested.
I will resume writing about Systems and new trading techniques soon.
Stay safe, and have patience.