Making Time Our Friend

Hurry…

…spoils the curry.

Specifically with regard to Equity…

…one should never, never be in a hurry. 

You see…

…there will always be a correction.

You will get an entry. 

Wait for the right entry. 

You will, eventually, get a prime exit. 

Wait for the time. 

Make time your friend. 

How?

Simple.

Take it out of the equation.

Simple?

In the small entry quantum strategy, time is, by default, taken out of the equation. 

It loses its urgency as a defining factor, for us, psychologically.

We don’t have any immediate timelines. 

We go with…

…the flow. 

When opportunities appear…

…we act.

When they don’t…

…we don’t act.

Most of the time…

…we don’t act.

Then there are black swans, and we act many times in a row. Like now.

Action, or lack of it, depends on what’s happening. 

We don’t force action.

Why?

Because we have all the time in the world. We’ve made it our friend, remember.

We know that we’ll get action…

…eventually. 

We conserve liquidity and energy for when action comes.

You see, when the pressure of a time-line is gone, quality of judgement shoots up.

We make superior calls. 

Of course we make numerous mistakes too. 

However, the quantum going into the mistake is small. This is the small entry quantum strategy, remember. 

Once we’ve made a selection mistake in an underlying, and have realised this, we don’t shoot another quantum chasing our error. Instead we let it be, and wait for a prime exit from our error. It will come. 

We keep going into identified underlyings not falling into the error category, with small quanta. 

Many, Many times, we make a price-error. Price going against us after entry is a price-error, because the market is always right. It’s us who are wrong when things go against us. 

Never mind. After a price-error, we enter the same underlying with another quantum, and this time we get a better price. Once gain one observes the friendliness of time, even after price has gone against us, all because of our small entry quantum strategy.

When price is going in our favour, we might not enter after a level. Though we’re not getting further entries in the underlying, appreciation is working in our favour. 

It’s a win-win on both sides of the timeline for us…

…because we’ve made time our friend. 

Shutting Down the Manipulator

Markets…

…manipulate. 

That’s their very nature.

Are we in the game to be manipulated?

What’s your answer?

Mine is no.

It’s a pretty emphatic no. 

I’ve backed my no with action. 

How do I stop the markets from manipulating me?

The answer if found in one’s trajectory of action.

Is there anything in one’s market actions that can be easily second-guessed by the market?

For example, is one acting upon plain vanilla technicals?

Is one acting upon news? Results? Announcements? 

Let’s not base our action upon anything the market is doing or telling us to do. 

Period. 

It’s as simple as that. 

With that, we’ve already shut out all avenues for manipulation.

Where does that leave you?

What to do now? 

You must be asking this. 

Well, build your own system. 

Let it expand and explore. 

Let it gain complexity. 

Let it boil the complexity down to simplicity. 

Let your actions be based upon your unique bridges. 

Yes, build your bridges.

Make your own market landmarks.

When you act, nobody knows that you are acting.

If nobody even knows that you are implementing an action, well, then nobody can know what that action is, or how it is implemented.

You’re done already. 

Enjoy your non-manipulable existence. 

I wish for you that it is lucrative!

🙂

Trigger-Happiness triggering your happiness?

Action?

All the time?

Do you crave it?

And, are you in the markets?

Boy, do you have your work cut out for you, or do you have your work cut out for you?

Ideally, your long-term investment should not give you action.

When it does, it should push you to act.

What backfires is when you act to push it.

Unless you’re convinced by a stock, you don’t buy it.

Unless there’s margin of safety, you don’t buy it.

Unless there’s more margin of safety, you don’t re-buy it.

Unless you’re fed up with the stock or the antics of its management, you don’t sell it.

The whole long-term game is biased towards inaction.

Those who master the art of inaction are good long-term investors.

Bridging gaps is paramount.

What do you do with the vast amounts of time at your disposal?

Do twenty other things.

Create value in many walks of life.

Let the areas not overlap with any of the markets you are tapping.

Capture the attention of your mind.

What happens if you don’t?

Boredom, inaction or the need for action will propel you towards making a mistake.

Mistakes in the market cost money.

That’s how they’re defined.

Do yourself a huge favour.

Approach the markets after having embraced inaction.

Stocks and the Art of Synthesis

A lot comes together.

This coming-together is called synthesis.

The word synthesis has now become universal.

It is applied in various fields, including Chemistry, manufacturing and the like.

It is also applied in areas where deep thought boils down facts to unity, to arrive at a conclusion.

What all are we looking at, with stocks?

No action.

Action.

Time-frames.

Market-level.

Selection.

Entry.

Management.

Exit.

One can list other stuff, but this list should do too.

One needs to synthesize the ingredients in such a manner, that the resultant matches one’s risk-profile. [[Why? Matching means successful market-play. Try it out.]]

That, my dear friends, is the art of synthesis, in a nutshell.

 

MP vs MoS : the lowdown on Trade-Entry

Margin of Safety (MoS)… 

… hmmm… 

… wasn’t that in investing? 

Well – surprise – it’s in trading too. 

You can enter a trade with MoS. 

How? 

Ok.

ID the trend. 

Wait for a minor reversal.

Let the reversal continue towards a pivot, or a support or a what have you. 

During this reversal, whenever you feel that you have considerable MoS, well – enter. 

Why shouldn’t you wait for the pivot to get touched? 

Things happen real fast at a pivot. Upon a pivot-touch, you can lose your comfort-zone even within minutes. 

Two vital things can happen at a pivot. 

Either there’s a quick bounce-back, or the pivot gets broken. 

Bounce-back means your trade is now in the money, and that you can go about managing your trade as per your trade-management rules. Wonderful. 

Pivot-break is not a worry for you. 

Why? 

Because you’ve placed your stop slightly below pivot, after the noise. 

Upon pivot-break, you get stopped out. You take the small hit and move on to your next trade. 

Eventually, things heat up. 

There is movement. 

Tops get taken out. 

Fast money can be made. 

How do you enter here? (Needless to say, for shorts, everything is to be understood reversed). 

Momentum play (MP)… 

… is the weapon of choice. 

You set up a trigger entry after a top or a resistance or a what have you, and wait for price to pierce, and for your entry to get triggered. Then you place your stop, below top or resistance or what have you. 

MP vs MoS is a matter of style. 

If you’re not comfortable changing your trading style to adapt to times, that’s fine too. Stick to one style.

If you’re conservative, stick to MoS. 

In a frenzy, however, MoS might almost never happen. 

In a frenzy, entry will be triggered exclusively through MP.

Take your pick. Adapt. Do both. Or don’t. Do one.

You call the shots. 

This is about you.

What about Daddy Cool? 

Boney M sang this blockbuster hit in the ’70s.

I’m sure you’ve heard it, because it’s still the rage. 

he’s crazy like a fool – what about daddy cool? 

Who’s Daddy Cool? 

You tell me. 

Is it you, in a cool cucumber moment, slow to respond to stimulus, devoid of anger, master of your situation in a kinda non-bossy, non-micro-managing (cool) way? 

And what of Mr. Hyde’s Dr. Jekyll nature? 

We’re talking about your “like a fool” moment.

Just for your information, winning behaviour is often termed foolish by the crowd. 

Contrarian investing is one such example. 

Successful derivative trading is another. 

To cap it, let’s not even talk about private equity in real-estate. 

Did someone mention high-yield structured-debt? 

There are many examples of “foolish” behaviour. 

These same examples earn very well. 

So… 

… how do we do it? 

We maintain our cool. 

We keep all basics going, as they are. 

With a small portion of our surplus, we take calculated risks, in a controlled environment. 

Sure, these risks will appear foolish to someone on the outside. 

However, our controlled environment has installed riders for our safety. 

A balance-sheet might be stressed, but not stressed enough for bankruptcy. 

A lock-in might be ultra-short. 

A stop-loss might be in place. 

Collateral might be up to 4x.

There might be a highly reputed Trustee in between. 

What have you.

Have your Daddy Cool fool-moments. 

Take some calculated risks with small portions of your surplus. 

These should give your portfolios an extra-boost. 

That nagging nagging push towards action 

Yeah, it’s always lurking… 

… in the background…

…waiting for an opportunity… 

… to catch you unawares… 

… and spring to the forefront. 

Market-play is a mental battle. 

Your mind wins or loses it for you. 

Make your mind understand the value… 

… of action… 

… and of inaction. 

Make your mind pinpoitedly choose… 

… the time for action… 

… and for inaction. 

Make your mind automatically switch from…

… a state of action… 

… to a state of inaction… 

… and vice-versa… 

… and feel perfectly normal doing the switch… 

… again and again and again. 

The above by itself is a winning state of mind for you, which you can build upon. 

🙂 

The Promise of Far 

I like “far”… 

What promises me far? 

Science fiction films. 

The Interstellar, Gravity, Inception and Contact types. 

Such films relax me. 

What relaxes you? 

Have you identified it? 

Why is this important? 

Many times, we must just sit. 

Action is harmful at such times. 

We are tense. 

We suffer from the fallacy, that action is better than inaction at all times. 

Relaxation-source identification is exactly for such times. 

Go ahead. 

Get your acts together. 

Your full acts. 

Your planning needs to incorporate strategies for inaction too. 

The Promise of Far”  strategy works well for me.

It’s not my only inaction-strategy. 

However, it’s a successful one. 

How not to let something be on auto-nag

Clutter-up.

Simple solution.

Have lots of things going.

This way, one thing won’t have the power to nag.

We humans reminisce.

We go into nitty-gritty.

We worry.

We thus waste our time and an otherwise perfect present.

That’s us.

However, we can condition. We can change.

That’s also us.

One small activity is over, and the other one should start. Prequisite is that the former activity has been closed properly, even if temporarily.

Yeah, no in-between time to ruminate about how well or badly the preceeding activity went.

New activity brings its own challenge. It first shifts and then rivets our focus.

Carry this mindset over, to your professional life.

That’s all you need to do.

Go for it.

🙂

What is an Antifragile approach to Equity?

Taleb’s term “antifragile” is here to stay.

If my understanding is correct, an asset class that shows more upside than downside upon the onset of shock in this age of shocks – is termed as antifragile.

So what’s going to happen to us Equity people?

Is Equity a fragile asset class?

Let’s turn above question upon its head.

What about our approach?

Yes, our approach can make Equity antifragile for us.

We don’t need to pack our bags and switch to another asset class.

We just approach Equity in an antifragile fashion. Period.

Well, aren’t we already? Margin of safety and all that.

Sure. We’ll just refine what we’ve already got, add a bit of stuff, and come out with the antifragile strategy.

So, quality.

Management.

Applicability to the times.

Scalability.

Value.

Fundamentals.

Blah blah blah.

You’ve done all your research.

You’ve found a plum stock.

You’re getting margin of safety.

Lovely.

What’s missing?

Entry.

Right.

You don’t enter with a bang.

You enter at various times, again and again, in small quanta.

What are these times?

You enter in the aftermath of shocks.

There will be many shocks.

This is the age of shocks.

You enter when the stock is at its antifragile-most. For that time period. It is showing maximal upside. Minimal downside. Fundamentals are plum. Shock’s beaten it down. You enter, slightly. Put yourself in a position to enter many, many times, over many years, upon shock after shock. This automatically means that entry quantum is small. This also means you’re doing an SIP where the S stands for your own system (with the I being for investment and the P for plan).

Now let’s fine-fine-tune.

Don’t put more than 0.5% of your networth into any one stock, ever. Adjust this figure for yourself. Then adjust entry quantum for yourself.

Don’t enter into more than 20-30 stocks. Again, adjust to comfort level.

Remain doable.

If you’re full up, and something comes along which you need to enter at all costs, discard a stock you’re liking the least.

Have your focus-diversified portfolio (FDP) going on the side, apart from Equity.

Congratulations, you just made Equity antifragile for yourself.

🙂

Action Oblique Inaction Upon Field-Proof

You.

Field.

In.

No theorizing.

Just get into the field.

Act upon field-proof.

Or, don’t act…

… upon field-proof.

That’s just about it.

There’s a time for theory.

It’s to tune your mind.

Learn the ropes.

Baby-steps.

Away from the field.

So you’re yet safe.

Fine.

That stage gets over.

The onus is on you.

Real world is different.

It’s not like theory.

If it were, everyone following theory would be a billionaire.

Today’s professors don’t even put their own money on the line.

If you don’t get a feel for the LINE, your paper-knowledge has no value whatsoever.

On the field, LINE is big. Very big. You have to handle the line well. Otherwise, your money’s gone.

So, gauge the field.

What proof are you observing?

Is it compelling you to act?

Yes?

Act. Forgot about everything else.

Is it compelling you to sit still?

Yes?

Don’t act. Sit still. Forget about everything else.

Carve your own dazzling destiny.

🙂

Making it Count

You’re playing a big one.

What’s foremost?

Make it count. For heaven’s sake.

Why?

Big plays don’t come too often. When they do, you have to catch them. You need to have energy left, to play. Then you just go all the way. Till the play plays itself out.

Life is an accumulation of knicks and knacks.

At first, you don’t know what you’re good for.

When you do know it, you start out as a net-net loser in whatever you’re good for, because every rookie needs to pay tuition fees. These are the costs of your mistakes.

Then you start getting the hang of something you’re naturally good at. Tricks of the trade – you learn them. You succeed in making your activity applicable, perhaps even financially viable.

Next step is to scale up.

You need to make your successful model count. Period.

Tired? Want to do other things? Need to borrow? Too big a pain? Time-issues? Overdose? Bureaucracy?

Whatever.

Don’t lessen the flow. Hold on. Ask the Universe for reserves. See the play through.

One life can mean just a few big plays.

When you’ve latched onto one, and have set it up so beautifully, now’s the time make it count.

Best of luck!

🙂

Plusses & Minuses of a Cloud-Society

Where do we stand today?

What’s changed compared to yesterday?

Are we better off?

What’s not better off?

Where is all this heading to?

Lastly, what’s your takeaway. 

People, questions, questions and more questions. It’s good to ask questions. Those who don’t, well, they don’t evolve. Stagnation in today’s day and age is owing to being late for a bus because nobody was there to put your shoes on for you, so that you could catch the bus. You didn’t attempt to put on these yourself, and you didn’t attempt to run-off bare-feet either. You kept waiting for someone who would put your shoes on for you. People, forget it and wake up. This party’s hot, and it’s moving very fast. Keep moving with it. It’s a hell of a ride. 

The word “Cloud” is very big today. 

“One needs to be in the Cloud, blah blah blah” etc. is heard at parties. 

Humans have realised the vulnerability of hardware. Data in the cloud is probably safer. Yes, Cloud it is . Cloud is the future. HOWEVER…

a). Keep multiple backups on your own hardware also. Accidental deletion on the cloud could sync across all your devices. Where do you stand then? Most cloud backup softwares throw in backing up to additional hardware for free. Use this. It’s a legitimate freebie. You’d be a fool not to use this. Btw, of course you’ve got your time-machine or similar backups going on the side too. BE WELL BACKED-UP.

b). Don’t necessarily keep sensitive data on the cloud. You can very easily manually back up your password-bank (for example) across multiple devices. Sensitive data needs to be password protected. Period. Music and photos can fall into different categories here. Depends on you. 

c). The norm with contacts is that they start backing up to your main email ID. Great. Losing one’s contacts becomes that much harder. Don’t store sensitive stuff in your contacts. 

d). Your main email ID becomes hugely important. Make sure it’s not hacked. Keep changing it’s password. Remember it’s password. Update it in your password bank. Use your email ID to search. Old emails, files, attachments, photos, anything. Today, the whole repository goes along with your email. 

e). Have a balanced approach towards social media. Don’t upload stuff you’ll regret. Try and circulate your family photos within controlled circles. Be wary of social media, and teach your kids of its dangers. 

f). THEN, Cloud is one thing, and accessibility to it and being well-organised on it is another. You could be fully in the cloud, but what use is your stuff to you in the cloud, if it’s not accessible across all your devices seamlessly, at a button-click. There are many software-services doing this for you. Your software-service needs to have a lightning search-functionality, which goes through your search-words and hashtags at a super speed [((btw you are not functioning without hashtags today, so that you can easily sift through your stuff, and call up something in a flash))]. Of course the whole thing costs. Just pay and BECOME SEAMLESS. What’ll you be set back by? 50 USD pear annum? Don’t be penny-wise pound-foolish. DO THIS. 

g). Please don’t forget your Internet-Security along the path. Use a pay-service, on you mobiles and your computers. People, why do we forget the basics?

h). Guard your eyes. Wash them. Use a moistener. Use Ayurvedic eye-drops on the side. Do eye-exercises. 

i). Guard agains neck pain (back-pain). Swim. Walk. Posture. Don’t overdo media. 

j). Guard agains index-finger pain. Mobile and desktop typing and touch has made the index finger of supreme importance. However, it is susceptible to pain and disease if you are not careful. 

k). Guard against heart-attack. We are a sedantry lot now. Almost all day, we vegetate. Most of us, that is. Get a band. Programme it to buzz every hour that you are in your seat. When it buzzes, move. Follow your daily steps. 10-15,000 steps per day is the need of the hour. Couple the band to your diet. Follow its calorie-burning module. Teach your band, till it comes out with intelligent suggestions. A band is like a pet. 

l). Guard your karma-balance. Be a contributor. Don’t only be a free user. Contribute freely on the web. Add to the world. Take the world forward. You are using so much stuff off and on the web, for free, that if you are not on your guard, you might end up exhausting a lot of karma. Thus, generate fresh positive karma too, to keep levels up. 

m). Lastly, it all depends on the internet connection you have, and how much you remain connected as you move. Spend well here, have access to more than sufficient data allocation and speed, both on your computer and on your mobile. An adequate internet connection with ample data-allocation is the lifeline of being in the Cloud. 

YEAH, use your Cloud well and optimally. Fine-tune your Cloud-effectivity. Keep in good shape. Be Cloud-proud! 🙂

Less is More

Fill your plate.

Work.

Go all out.

Nobody’s asking you to work less.

Research.

Hit it with your best shot.

Do quality work.

Work with the best tools.

Enjoy your work…

…so much so, that time ceases to exist.

Yeah, that means you’ve found your calling.

However, connect less to live Mrs. Market.

Here, less is more.

Keep her away as much as possible when she’s live.

Only connect live when you really, really have to.

What are you achieving?

Minimal bogging down live market forces.

You’re away from the pandemonium, the confusion.

You’ve set your self up brilliantly, to think clearly.

Now, gather your thoughts, gather your research.

You get into the Zone.

You have a purpose.

It can be anything. A market instruction. An instrument alteration. A structural change. A query. A test. A probe. A check. Something small. Something big.

With your purpose right before your eyes, connect live.

Solve your purpose.

Disconnect.

Relax.

Let remnant market forces leave you, yeah, let them dissipate.

Do some other stuff for a while.

Then, when you’re ready, get back to your research.

If you’re not ready after a while, call it a day.

Go for a swim. Or something.

Take that –>@&%# Mr. Peer Pressure

Dear Mr. PP,

I don’t give in to you, never have, never will.

You’re not that important.

I don’t spend my time thinking about you.

I don’t respect any entity without a backbone, and you certainly don’t have one.

I’ve met you many times.

At first, I felt you, and was taken aback. You wanted me to do something I didn’t wish to do. You were strong.

I was stronger.

When you don’t know anything about the reputation of your opponent, frankly, you don’t give a d*m*. You fight. Till you fall or till the other fellow backs down.

I won my first head to head with you. Thank my stars.

After that I found out who you were. Yeah, who was it exactly that I didn’t succumb to?

After I’d grown up and all, and fully realized your devastation potential, I always leaned back on my first head to head. I mean, you were beatable. Period.

Yeah, I was lucky to have beaten you first up. It’s been a huge psychological advantage.

I’ve carried over this advantage into my market life.

Take a hike, Mr. PP.

[As far as market related activities go, I follow and advocate an unbiased, singular and customized path which doesn’t follow any crowd or any myths as such.

This path certainly does not let me invest under any kind of pressure.

Where there’s pressure, there are vested interests.

Please beware of investments which don’t suit your risk profile and are touted to quench vested interests].

A Secret Ingredient for Equity-People

Racking your brain about how to make Equity work?

Don’t.

Two words work here. 

Be passive. 

Learn to sit. 

Let’s say you’ve gotten all your basics right.

Company is great. Management is sound. Multiple is low. Debt is nil. Model looks promising. Yield is note-worthy. Technicals allow entry, blah blah blah…

Then what?

Yeah, be still. Learn to sit. 

What are the prequisites for sitting?

You need to not need the stash you’ve put in, at least for a long while. 

You also need to get your investment out of your primary focus. 

For that, your day needs to be full…of other main-frame activities. 

Make Equity a bonus for yourself, not a main-course. That’s how it’ll work for you. That’s the secret ingredient. 

How to… … is stated above.

Why to? Aha.

For it to work, fine, but why the sleeping partner approach?

Human capital needs time to show results. 

That’s why you’re in Equity, right, for human capital? The rest is ordinary stuff, but human capital is irreplaceable. Human capital works around inflation. One doesn’t need to say anything more. 

You’ve got your work all cut out.

Get going, what are you waiting for? 

Finding Structure Within

You are you. He is he. She is she. I am I. It is it. 

Even if the above is the only thing that you carry home from this space, you’re done already. 

Move on then, with your life, because you’ve understood something big. 

If not, do please read on. 

You are not I. I am not you. He is not she. She is not he. That’s it. 

Here’s the next biggie.

Those who come into funds need to know how to manage them. Period. 

Do what you want. Run umpteen miles. Put up a million facades. Muster up all the drama you’re capable of. After that you’ll come to this conclusion …

 … that nobody else is more capable of managing your funds than you yourself. 

Why?

Because you are you. You know yourself best. A third party is firstly (realistically) not bothered about knowing you, and secondly is only capable of seeping into a minuscule portion of you, if he or she makes the effort. Forget about third parties. 

So you realize you need to manage your own funds, what then?

Jump into the water.

While your corpus is small, make mistakes. Learn from them. That’s college. Tuition fees.

Recognize your strengths. Play to them. Pulverize your weaknesses after identifying them.

Then come the structures, from within. These are your structures. They’ll come from inside of you. 

There’s you, and there’s the battle-field. The two are face to face. It’s a do or die situation. You go into reflex-action mode. Your systems start to function at full capacity. That’s when structures emerge.

Yeah, structures need an activation barrier to emerge. 

There’s a protective structure. It’s your protective structure. It guides you to build your moat. It protects your family. 

Then there’s your post-protection bulk-game structure. It guides you towards building up your innings without the worries of basic bread and butter. 

Lastly, there’s your multiplication structure. It chalks out high-reward-high-risk strategies, tweaks them towards maximum possible safety, and tells you where to put that minute percentage of your corpus with the intent of achieving extra-ordinary gains. 

Allow such structures to emerge. Embrace them. Innovate. Improvise. Achieve. Educate.

Go for the jugular. 

Can I Really Really Really Do Without Fundamentals?

I like to trade without a bias. 

Lack of bias means freedom… 

… freedom to think independently…

… not falling prey to another person’s opinion…

… which then allows you to listen to your system…

… trade identification…

…setup demarcation…

…trigger-entry…

…trade triggered…

…trade management…

… trigger-exit…

… exited.

That’s it, move on to the next trade. 

News gives me a bias. 

No news. 

You know what else gives me a bias?

Fundamentals. 

I don’t wish to look at fundamentals. 

If my eyes are seeing a setup in the EuroDollar, I would like to take it without the nagging thought of “what will happen if Scotland says NO or YES”.

I don’t want to care about inflation numbers, or job figures, or industrial output or what have you. 

I mean…can I just …do it?

Meaning, can I just do away with fundamentals, and focus on technicals only, which is my area of specialization?

Sometimes, I get a little unsure. 

I start looking around. 

How are others doing it? The experts, that is. 

My uncertainty gets fanned a little more, when I see experts not really ignoring fundamentals, even though they might be specialized in technicals. Hmmmm. I’m still not happy looking into fundamentals. I mean, why should I take time-out from my strong suit, and devote it to my very weak suit?

No, I decide. I’m really not going to look at fundamentals. 

What’s the worst that could happen?

Let me just see if the worst that could happen is bearable.

Ok…I ID a trade…demarcate a setup…and the trade goes against me because of the announcement of some number in the afternoon. People looking at fundamentals would have waited for the announcement of the number and then traded. Fine. 

In the world of trading, it is always good to have the worst-case scenario unwrapped and right before your eyes to see what it really means. 

You know, I can take this. 

Would you like to know why?

Firstly, I would like you to understand that we are looking at large sample-sizes here. Any sensible reasoning would only apply to large sample-sizes. 

Over the long run, and over many, many trades, Mrs.Market will go either way after an announcement of a fundamental number with a chance of roughly 50:50. 

If this is true, it is very good news for me, good enough to just kick fundamentals out of the equation. 

At times, the market reacts as per the crowd’s anticipation. 

At other times, it reacts in the opposite fashion. 

I assume that the ratio of the above two directions taken by Mrs. Market over a very large sample-size would be 50:50.

I think my assumption is correct. I don’t want to go through the labour of proving it mathematically. 

Ok, let’s assume that my assumption is correct. I then kick fundamentals, and go about my work while relying on my strong-suit, i.e. technicals. This trajectory will very probably have a happy ending. 

Now let’s assume that my assumption is wrong. 

What saves my day?

Technicals. 

Technicals very often give setups that factor in crowd behaviour and crowd anticipation of market direction. 

Technical setups get one into the build-up to an announcement. 

More often than not, one is already in the trade, in the correct direction, enjoying the build-up to an announcement without even knowing that the announcement is coming, if one is not following fundamentals. 

Technicals can actually do this for you. I’ve seen them do it. I mean, the GBPUSD has been giving short setups during the entire 1000 pip run-down recently. To have availed such a setup, people haven’t needed to know that a referendum is coming. All they’ve needed to do is to take the trade once they see the setup. 

Actually, that’s it. I don’t need more.  

I don’t need to reason anymore with myself. Everything is here. 

I think I can let go of fundamentals safely.

Even this trajectory should have a happy ending.

Happy Fourth Birthday, Magic Bull !!

I believe in birthdays…

…and Magic Bull turns four today… 🙂 🙂 … .

When I die…

… this writing will live on. 

I won’t be taking my forex with me. Nor will I be carrying any equities. My soul will carry the satisfaction, though, of having created Magic Bull.

I love to write. 

It gives me a high. A huge kick. 

I feel totally free. Complete freedom. Have you experienced such freedom?

No shackles. 

I like to break barriers with my writing. 

I’ve reached people. Inside. People start to think whey they read this stuff. 

This is earning. For me. 

ANYWAYS, just as a breakout underlying breaks away into new highs, shattering all resistance in the process, in the same manner, words have just been overflowing over the past few months, after more than half a year of absolute dryness…

… such are words. 

However, by now, I’ve learnt enough to give them the respect that is due when they come. 

When words start flowing, there’s just one rule that applies. LET THEM FLOW. 

I don’t care how embarrassing that might be. 

What is embarrassment when the same words can bring about vital change? I really don’t care about the embarrassment. 

I decided long ago to make my tenure count. 

Contact with me is going to make an impact on you. Words are my medium. Without giving you an energy boost, I remain unfulfilled.

Why? 

Everybody has a purpose in life. 

Mine’s to make changes with the sheer force of my words. 

You have your purpose. 

I have mine. 

With Magic Bull, I fulfil my purpose of existing.  

With due respect, have you fulfilled yours? 

And, with due respect, have you even recognized yours?

Food for thought. 

🙂

Charting Charting Charting

Why don’t you just…

… trade what you see?

Trade the chart, dammit.

Not the level.

Not the expectancy of a turnaround.

And, although I still do this because it gives me a kick, why do we even trade corrections?

Why can’t we just trade the sheer chart?

Every chart is either going up, down or nowhere.

So it’s pretty obvio, that the first step would be to…

… to what?

… to decide where the chart is going.

Again, it should be pretty obvio, that if a chart is going nowhere, then you are doing… what?

Are you trading such a chart?

NO!

Wait for such a chart to break out in one particular direction.

Wait for the LTT to turn in this direction.

Then trade this chart. Not before.

Yeah, LTT stands for long-term trend.

Yeah, we’ve befriended the LTT so much, that we have an abbreviation going for it…

Once you’ve sorted out the direction, look for an entry setup.

Be patient.

If the entry setup hasn’t formed yet, wait for it. If you can’t stop your twiddling fingers from doing something, feed in a trigger entry in case of a hypothetical setup formation within the next few hours / days, if your trading station allows this.

There’s no up or down anymore, to be honest. You are going where the chart is going, period.

You are also not asking the stooopidest question of them all…

… you guessed it… “Did the sensory index go up, or down?”

Just forget about the sensory index, ok?

I mean, we’re so done with sensory indices in this space.

Why?

DLF could tank 20 bucks on a day the Sensex goes up. Dow Jones could be down 50 points, but Pfizer could just spring into a stellar upwards move. Why should we have lost the short-side opportunity that DLF hypothetically gave, or the long-side opportunity that Pfizer could present, for example? We will do exactly that, i.e. lose the opportunity, if our focus is on the sensory index.

Focus on the underlying.

To be more precise, focus on the chart of the underlying.

Happy trading.

🙂