Why Technicals won't work?

Hi Shabbir and everyone.

I have brought your book and studied thoroughly. I have even checked some other books on technical analysis and charts also but one thing is striking me is whether the technical analysis really work? As per my observation i feel a big no. I don't think technicals really work in indian markets.

The best example is the last week's recent down trend in markets. I have identified few stocks and monitored its movement for almost for 10-12 sessions. I have got few buy indicators like bollinger bands etc and then brought some of them but to my surprise no technical has worked.. another mess is i have again done technical analysis and shorted some stocks on Thursday but to my surprise it again misfired.

I 'am sorry if i hurt any body's sentiments but i am in opinion that no technicals and global cues will work for indian market. Only news and just news will work for our markets.

a small request for you guys what and all technical indicators you will decide to buy or short a stock. Which indicator is most efficient? Please guide me

Bottom line : Is it better to learn astrology for dealing with indian markets or technical analysis?

 

Rajesh,

Technical’s work perfectly if nifty is trending. Last Thursday was future expiry day, so stocks will tend to volatile on that day. Its little risky to trade during future expiry. Since nifty is at support level , and because of political issues investors are scared to enter long now.

Shabbir - Please comment.

Regards,
Kiran

 

Hi Rajesh,

Good you have brought out this point. If you ask me - "Technicals work far better than astrology".

I have done few trades which are fruitful even in expiry week.

You need to keep in mind few things -
1. Study (not read) Shabbir's book.
2. This is like business so be prepared to lose money as well. Consider it as learning experience, so take lesson why the trade is gone wrong.
3. NONE can identify the exact top and exact bottom, so check the trend before you do anything.
4. Keep patience, you may not see your trade giving results immediately. Wait for few trading sessions.
5. Keep Stop Loss.

IMPORTANT - Elections, Government etc will impact market. However, don't worry about it. Remember - fundamentals don't work in Indian market. Market discounts everything. It's all about how people respond to those news. Only technicals can tell you how the big players are executing on those fundamentals. So be with them. One time, I had given up on technicals thinking it's all nonsense and studied fundamentals. But trust me it doesn't work!

Good luck, and enjoy trading.

Cheers.

 

Hi Rajesh

Indicators like bollinger bands alone cannot decide the market.
U try to concentrate in PATTERNS like
1.Higher top higher bottom
2.Lower top lower bottom
3.W pattern
4.Mpattern
5.Head n Shoulder pattern
You study these patterns and try to apply. Follow using stop loss.
Definitely Technical Analysis will help you.

Before buying Shabbir's book i blindly followed the NEWS and bought shares.. It didnt workout.. Following News results in lot of money loss. Follow the technical analysis ... Surely it ll help you. It will take time to understand. But keep on studying and try to apply these patterns. You will Win

 

technicals definitely work...it just to know how to use them.....i read a post some time ago, "trading is an art." i agree with it. that doesn't mean that i don't make losses, but it adds to my experience and then again learning from the mistakes is an important thing. if i tell you my experience, earlier when i used to trade, it was actually like a gambling. now after reading Shabbir's e-book, i felt that if i made some loss or some mistake, i come to know the reason why i made losses. now this is actually a process of learning from your own mistakes. and with experience, it adds to your knowledge.

 

Sorry for replying late. Thanks to all for replying to post. I 'am totally confused how to read the patterns. In shabbir's book i could able understand only the moving averages & Bollinger bands. If some one make some time to explain in simple and practical way it would be very much helpful for me.

Let us assume i have monitored some stocks for few day and then zeroed on Karnataka Bank. How to check the technicals of this stock.

1. Which pattern or technical i have to check first.
2. How to know whether the stock is bearish mode or in bullish mode.
3. How to arrive the break-out and stop loss.
4. Which and all indicators i have to apply

Please help me in clarifying the queries

 

In this Karnataka bank chart it forms lower top and lower bottom.

In the chart T stands for Top and B for Bottom.

1. T1 is the first top ...T2 is second top. Here T2 is lower than T1
Likewise T3 which is the third top is lower than T2.
T4 is lower than t3..

2. B3 is lower than B2 and b4 is lower than B3

So now v can decide by seeing the chart this stock forms bearish pattern.. We have to avoid this stock....


STOP LOSS:

In the above chart ;

When the stock price moves to T2 , B1 acts as a Stop loss.
We should note that stock price should not go below our Stop Loss.
Once the stock price starts to move below the stop loss we have to come out from that share safely with less money loss..

 

Hi Rajesh,

I recommend you to take some time off, and immerse/understand/learn/study into Shabbir's book. I don't think you've attempted it yet.

We're happy to advise what works for us, but for you it may be entirely different experience. You'll enjoy that journey. Learn fishing, don't buy

Cheers!