Distill
learning into useful concepts and guidelines. Observe and understand daily
market action in a competitive environment. The ultimate and degree of success
depends on the effort of the individual. We are dealing with “probable” outcome
with facts to make decisions. The business of “prediction” is a matter of
putting oneself into the path of “optimum probabilities”.
The art of
learning to time the market requires the trader’s mental attitude to be
flexible and independent. Appraise the market on a continuous daily basis. Too
often individuals and advisory stop listening to the market and begin telling
the market what to do with disastrous results!
Flexible and
independent seems easy but difficult to attain and apply to avoid being swept
by the mainstream opinions. Independent thinking requires objectivity and
logical. Anything that is subjective and illogical should be totally avoided.
Emotional barrier will continue to inhibit one’s ability to think
independently.
Determine market
LONG, INTERMEDIATE and SHORT term trend. Analyze WEEKLY and DAILY chart including
4-hours Intra-day (if available). Are all the 3 different time frames in unison
(tandem)? Are they conflicting? Smaller time frame is the building blocks for
bigger time frames.
What are the
indicators reviews for LONG, INTERMEDIATE and SHORT term trend.
How reliable
are the indicators in the past? How reliable are these indicators in varying
market conditions (UP-DOWN-SIDEWAY-BEGINNING-MIDWAY-ENDING)?
When does the
indicators “lag”, “ahead” or “on-time” with the varying price trends?
Do you feel
you should be invested at all times?
Check the upside potentials and downside
risks. What are your requirements?
Which product suits your requirements? Stocks,
Options, Index, Commodities?
Determine
your entry points and exit levels! To act prematurely requires careful planning
and management.
Are you too close to the market? Are you too far from the
market?
Do you let your emotions run influenced by what you see on the prices?
Many prophets
and gurus have predicted the market in the past, present and will be predicting
in the future! Our tendency is to look at the present assuming it will last
forever! The best analyst in the world is within you if you are able to think
objectively and independently without influenced by emotion or news.
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