Thursday, March 4, 2010

Trading blunder!

How will you explain the failure of a test-cricketer in one-day version?
How will you explain the failure of a one-day player in test version?

Layman thinks that the only difference is in the time limit!
What a mis-conception!
Both seem to be cricket, yet both are technically very very different!!!

Limited overs v/s Unlimited overs
Field restrictions v/s No restrictions
Skill v/s Technique
Consistency v/s Experimentation
Speed v/s Stamina
Mental approach for both are poles apart.

It won't be wrong to say that both are practically different games!

That is why, those who try to play both versions in the same manner fail miserably.

Similarly,

How will you explain the failure of a Day-Trader in Positional-Trading? and
How will you explain the failure of a Positional-Trader in Day-Trading?

Layman thinks that the only difference is in the time limit!
What a mis-conception!
Both seem to be trading, yet both are technically very very different!!!

Swing trading is the art of imagining the unimaginable, thinking the unthinkable!
Day trading is exactly the opposite.
Day Trading is the art of keeping imagination chained, keeping thoughts paused!

Satyam fell from 226 to 126 to 60 to 6;
day traders were mauled to bankruptcy;
when everyone was writing its obituary, the positional trader
imagined the unimagineable,
dared to think the unthinkable
bought it at 6,
recently it touched 126!
That's swing trading!

Recently, Suzlon fell from 132 to 55.
Everyone seemed to have surrendered when the positional trader
bought it at 55 and it zoomed to 100 in a few sessions!

Only a great Swing trader could have
took entry when sensex was at 7000 expecting it to touch 18000 in little over an year!

Only a great Swing trader could have
bought Tata motors at 111 expecting 777 in 1 year!

So, Swing trading is the art of imagining the unimaginable, thinking the unthinkable!

But the same strategy would be suicidal to in Day-Trading!

Imagination brings thoughts
Thoughts bring emotions
They all bring expectations
Expectations hypnotise
And a hypnotised trader is slapped!

In day-trading all you need to do is
just pick the trend, and keep blindly following it!

No imagination,
No thoughts of greed,
No thoughts of fear,
No thoughts of doubt,
No thoughts at all!

Just keep following!

Complete surrender to the music being played!

Both are opposite.

In one you imagine!
In the other you don't!

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