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OPEN INTEREST AND VOLUME THEORY Hello Mates good afternoon, So I choose open interest and volume theory for today's research because whenever we want to talk about trading the first thing comes into our mind is volume because it is the only thing which also followed the price and it is must be followed thing for price action and for breakout traders too. So like in equities there are Volumes likewise there are Open Interest in F&O ( Futures and Options) I hope we all are familiar with this which we can use for taking trades and positions so here are few examples which I found sharing below with all of you. 1- Price, Volumes and Open Interest are all up so we can expect a Bullish trend because these all three indicating Long buildup in a particular security or scrip and will follow by the Trend too. 2- Price Up volumes and Open Interest both are going down so we can expect that this is a short covering ( the trade has been earlier shorted and in order to square of their positions) So from this we can expect weakness is coming for a specific time in Uptrend. 3- Price Down and Volumes and Open Interest are going up it means there will be Short buildup are in progress in a particular scrip or in trade so it indicates weak Trend could come. 4- Price Volumes and Open interest all are going down in any scrip or trade it means that the trend has become weak and the Long positions from market are Unwinding. So this is all, I hope this information will be useful to all of you. Regards and Good luck for coming trades and investments..
NSE:NIFTYEducation
by AMIT-RAJAN
6
Picking rules - the Lynch methodBack in 1977, the still famous investment company Fidelity Investments entrusted the management of a small fund of $18 million to this very man. The next 13 years were impressive for the Magellan fund and its manager - the famous Peter Lynch. The fund's assets grew to $14 billion, more than doubling the average annual growth of the S&P500 stock index. When he stopped actively managing assets, Peter shared his approach with the rest of us. Some of his thoughts inspired me to create my approach and may be useful to you as well. 1. The private investor has an objective advantage over institutional investors (e.g., funds) because he is more agile. He is not burdened by the need to coordinate his actions with the management of the company, and his purchase requests are easily satisfied by the market. Agreed, it's easier to buy for $1,000 than it is to buy for $1 billion. Thus, the private investor can catch prices that the big "players" will have a hard time getting. 2. Don't spend everything you have under your belt on stock investments. The trades will not be able to close "in the plus" just by your own volition. So first provide yourself with a financial safety cushion, a stable job and a place to live, and then start investing. 3. Admit to yourself: are you a patient person who is capable of making independent decisions, diving deep into analysis and soberly reacting to plus and minus changes? If not, practice, but on small volumes. 4. Never buy a company's stock if you can't explain what it does and can't talk about its financial performance. The stock market is no place for gambling. There are slot machines, etc., for that. 5. The company works for profit and grows because of it. So keep an eye on everything that affects profits. Evaluate the company not in monetary units, but in the number of profits. 6. Watch where the company invests its profits. If it's mostly capital investments that will probably make a profit someday, in the distant future - think about it. After all, the beautiful future as conceived may not come. If, on the other hand, the company is allocating its profits to buying its own stock, it means that management thinks the current stock price is attractive enough. 7. The success of the stock may be unrelated to the company's financial success. Beware of such investments. 8. A company's financial success may not be reflected in its stock price for a long time. However, the longer the period in question, the more direct the relationship. So if you select companies based on an analysis of financial performance, be prepared to make a long-term investment. To this day, these thoughts help me look at assets consciously and not give in to spontaneous decisions. What do you think of this approach?
SP:SPXEducation
by Be_Capy
2
'RESUME' the trend journey with a 'PAUSE' candleDefinition:- As the name suggests pause candle is the candle formed in between the trend, the change is usually opposite the trend i.e. if the underlined script is moving in an uptrend then the pause candle will be of negative change and the color will be red and vice-versa. The pause candle indicates a pause in fresh positions by market participants and an entry chance for players expecting reversals. Also, it's an opportunity for new players to enter the trend i.e. for those who have missed the initial trend. Rules or Characteristics of a pause candle:- 1. Prior candles should be aggressive i.e. large candles of the opposite color. 2. It is generally of very small size as compared to the previous one and of the opposite color. 3. Volume is considerably low as compared to previous candles. 4. The RSI level of the spot where this candle originates is usually between the band of 35-75. The psychology behind the pause candle:- In the market everything has a cause and a reason similar pause candle also conveys its message to the market players. The generation of the pause candle signifies that there is fatigue among the participants who were driving the stock or are taking some break. Also, it alerts that new hands have entered into the trend and are trying to offer resistance. Those who are looking for reversals spot this candle and enter into trade with the hope of reversals, they are generally weaker hands. Bigger hands those who were the driving force of the trend also want the new player to enter the trend so that they hunt them down and resume the rally at a lower price. How to trade pause candle:- Now, as small players, we don't know what goes inside but try to predict the message through the candle. If a pause candle is formed it doesn't mean the exhaustion of trend or reversal rather indicates a pause in fresh market position. But, here the aggressive trader enters with trades opposite to the trend. At this stage, two cases arise, note talking for an uptrend:- -> The next candle's high crosses above the high of the pause candle: Maximum times this is the case that arises, here the candle after the pause candle crosses the high of the pause candle now what does this indicate? The indication is that the trend drivers or bigger hands are active again and those who have taken a position against the trend are trapped and will try to escape hence, the move will be much sharper as compared to the initial trend. How to benefit in this case? When you spot such a pause candle that is formed after a continuous trend set it to alert candle and wait for the next candle to form. If the next candle crosses the high of the pause candle take the position along the trend and your stop would be the low of the pause candle which is generally too small and ride the sharper trend which is usually equal to the initial one. -> The next candle's low crosses below the low of the pause candle: Though not arises usually sometimes it does occur, here the candle after the pause candle crosses the high of the pause candle now what does this indicate? The indication is that the trend drivers or bigger hands are in the backseat and are not seeing further upside also there is a chance that they can book profits at this level. How to benefit in this case? When you spot such a pause candle that is formed after a continuous trend set it to alert candle and wait for the next candle to form. If the next candle crosses below the low of the pause candle take the position against the trend and your stop would be the high of the pause candle which is generally too small and ride the reversal trend which is usually half of the initial one. This case comes under the reversal candlestick patterns on which earlier an article was published by me but here we are concerned about a pause candle after which rally resumes. Here, is an example of a different scenario though it doesn't match the above said cases but still the background is of a pause candle. HIL was trading above a rising trendline and suddenly breakdown the line after which we see continue 2-3 red candles following the candles a pause candle is formed with all the above-discussed properties but rather than showing the sharp downfall it again forms a pause candle but note stop loss is not triggered. Here 3-4 pause candles are formed and finally it breakdown all the low with a big red candle and then afterward we saw a huge, sharp downfall. The motive to explain the above example was that though sometimes we don't see rapid action but if your stop is not triggered and the candles are with the low volume then you can assure that a sharp move is pending and sooner or later it will happen. Note: The only constraint is to identify the correct pause candle for which you can refer to the above-said rules are very important. Sometimes the candle after the pause candle crosses both the high and low of the pause candle in that circumstance you have to check the color of the candle, for uptrend it should be green then you can take the position else if it's red then wait for the next candle, and vice-versa for the downtrend.
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NSE:NIFTYEducation
by Chaser30
5
Find a perfect Trend Line With this check listThere are many traders out there who trade trend lines. Mastering trend lines is not easy as it seems, with experience things changes with your perception about Trend Lines. What I learned from my experience is that it is important to find a trend line, but it is more important to filter it so that, we can trade only the potential opportunities. Here I do not say that those trades which we filter out will not work or we efficiently filter out those less profitable trades, because adding a filter in your system not only filter trades which are unprofitable but also filter out profitable trades. You have to accept that you are leaving better for best. So, what are the check points I follow to filter out Trend Lines, 1) Touches, I prefer more than three touches and I strictly follow it. See what happens with two touch the number of trades increases too much; I am not saying trend line with two touches does not work but that trend line cannot be of higher profit potential than 3 or four touches. 2) Distance between touches, it is stated that if touches have equal distance between them the trend line is considered as a good Trend Line, but i do not strictly apply if the touches are places at enough spacing and the distance between then approximately equal that it is a good Trend Line. I do check distances but not strict on it. 3) Apply your own logic, this is a very subjective thing, person to person it will vary. Every trader looks the same setup differently, setups will only work when his psychology matches with those setups otherwise it will not work. Build your own logic. At last, I want to end this post by a quote I have in my mind. "True Knowledge cannot be taught, it can only be caught."
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Education
by TRADEWITHFUN247
11
I dream of entering the stock market. The question is: What for?Read the previous part of the post here . Having received only denials, the owner of the workshop decides the following: it would be great if shares were sold and bought not in the offices of banks, but in one single place - the stock exchange. Then those who want to vote would be able to buy as many shares as they need votes. Those who want a discount will wait until the price on the stock exchange falls to an acceptable level for them. And those who bought one share would be able to sell it at any time at the exchange price. The owner likes this idea and decides to list his shares on the stock exchange. Another term to remember is listing. Listing is the service of the stock exchange to allow the shares to be traded on the stock exchange. Now the shares can be bought or sold in one place, simply by connecting to the stock exchange trading through brokerage companies. The banks, which have brokerage licenses, also liked it. The main thing is that now they do not have to convince clients to buy shares for dubious rights, you can just say that the price at the exchange is constantly changing, and if you buy shares at $ 1000 now (in the bank office), then a month later at the exchange you can sell them already at a higher price. This created a real stir around the company's shares, and they were bought up from banks at the IPO price - that is, at the original price of $1,000 per share. A significant advantage for any investor is the ability to buy or sell shares quickly and easily. That is exactly the kind of opportunity stock exchanges provide. If there were no stock exchange, the owners of shares would have to look for buyers on their own. But now they have the opportunity to connect to the exchange and make a deal at any time. As soon as the stock exchange started trading, the share price of the workshop came to life. This attracted new investors who tried to buy cheaper shares and sell at a higher price. Such investors include you and me. So what we know so far: - A company needs stock to sell a share of its business and get real money. - Shares can only be issued by a public company. - Shares give its owner rights: to vote, to receive agreed dividends, and to receive a share from a bankrupt company. - The initial sale of shares to the public is called an IPO (initial public offering). - During an IPO, shares are sold not on the stock exchange, but through brokers or banks. - The first day of stock trading on the stock exchange is the completion of the IPO process. - In order for the shares to be traded on the stock exchange, the company has to go through the listing procedure. - It is only possible to buy shares on the stock exchange through a licensed broker. - The exchange price is constantly changing during trading. The workshop story may give the impression that we small investors are only being used to get money from us in exchange for unnecessary rights. However, it is important to understand that we are more interested in the opportunity to profit from the growth of the shares than in gaining formal rights. It is this desire that unites all shareholders of a company, whether you have one share or a million. A joint-stock company can be compared to a hotel with many identical rooms. One share is one room. If the hotel is doing great and making a profit, investors will want to buy more rooms, and sellers will want to sell more rooms at a higher price. If the hotel performs poorly and makes a loss, then room owners will get rid of them (i.e. sell even at an unprofitable price to get money and find another hotel that is more attractive for investment). The strategy I will share will be to find, figuratively, great hotels (in fact, joint stock companies) during a room sale (i.e., a period of declining stock). We'll figure out how stock prices are formed on the stock market soon. See you next time!
NSE:BANKNIFTYEducation
by Be_Capy
2
Part 1: Equity Derivatives - A Beginner's GuideWhat are derivatives? Basic interpretation : something which is based on another source. A derivative is a contract or product whose value derives from the value of the base asset. The base asset is called the underlying asset. i.e., Sugar prices will rise if sugarcane prices increase due to low production. It means sugarcane is the underlying asset of sugar because the value of sugar is associated with sugarcane. There is a broad range of underlying assets: Metals: lead, gold, silver, copper, zinc, nickel, tin, etc. Energy: coal, natural gas, etc. Agri commodities: corn, cotton, pulses, wheat, sugar, etc. Financial assets: Stocks, bonds, forex, etc. There are two types of derivatives: 1. Exchange-traded: A standardized derivative contract, listed and traded on an organized exchange. 2. Over-the-counter/off-exchange trading/pink sheet trading: A derivative product in which counterparties buy or sell a contract or product at a negotiated price without exchange Instruments of derivatives market: There are four instruments in the derivatives market: 1. Forward: Forward is a non-standard agreement or agreement between two parties that allows you to buy/sell the asset at the agreed price for a pre-decided date of the contract. Forwards are negotiated between two pirates, so the terms and conditions of the contract are customized. These are called over-the-counter(OTC). 2. Future: Future contracts are similar to forwarding contracts, but the deal is made through an organized and regulated exchange rather than negotiated between two counterparties. A futures contract is an exchange-traded forward contract. 3. Options: A derivative contract that gives the right but not the obligation, to buy or sell an underlying asset at a stated strike price on or before a specified date. Buyers of options- Pays the premium and buys the right Sellers of options - Receives the premium with the obligation to buy/sell underlying assets. 4. Swap: A swap is a derivative contract between two counterparties to exchange for the cash flows or liabilities from two different financial instruments. It is an introduction article. I will cover all these topics in detail. Swap helps participants manage risk associated with volatility risk interest rate, currency exchange rates, & commodity prices. Index: Index = Portfolio of securities An Index shows how investors experience the economy. Is it progressing or not? A Stock market index gathers data from a variety of companies of industries. The data forms an overall picture and helps investors compare market performance through past and current prices. Financial indices represent the price movement of bonds, shares, Treasury Bills, etc. Importance of Index: 1. An index is an indication of a specific sector or gross market. 2. It helps investors to pick the right stock 3. An index is a statistical indicator. It represents an overall change or part of a change in the economy. 4. In OTC & exchange-traded markets, It used as an underlying asset for derivatives trading 5. An index helps to measure for evaluation of portfolio performance. 6. Portfolio managers use indices as investment benchmarks. 7. Index illustrates investor sentiments. Types of index: There are four classifications for indices: Equal Weighted Index: Each company is given the same weightage in the composition of this index. Equal-weighted indexes are more diversified than market capitalization-weighted indexes. This index focuses on value investing. Free-float index: In finance, equity divides into different among various stakeholders like promoters, institutions, corporates, individuals, etc. A tradable stake for trading is called a free-float share. i.g, If XYZ company has issued 5 lakh shares with the face value of Rs 10, but of these, 2 lakh shares are owned by the promoter, then the free-float market capitalization is Rs 30 lakh. Free-float market capitalization: Free-floating shares * Price of shares Index: BSE SENSEX Market capitalization-weighted index: In this index, each stock is given weightage according to its market capitalization. High market cap = High weightage Low market cap = low weightage Market Cap= Current market price * total number of outstanding shares i. e, if XYZ company has 1,000,000 outstanding shares and a market price of 55 rs per share will have a market capitalization of 55,000,000. Index: Nifty 50 Price Weighted Index: High price = More weightage Low price = Low weightage Popular price-weighted index: Dow Jones industrial average & Nikkei 225 I will upload second part soon. Thank you :) Money_Dictators
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NSE:NIFTYEducation
by Money_Dictators
12
Correlations between Nifty and DXY studyHello Friends, here we had shared just an observation on correlation between NIFTY and DXY which are clearly showing opposite directional runs from last couple of months, also we are assuming the wave counts on both, which are suggesting same patterns ahead along with good support by this correlation, this increases good chances of winning probabilities of our forecasting and analysis, this whole scenario helps in view building and analyzing charts. I'll mention that this is for educational purpose only, and this is not for trading purpose . Thanks Most investors treat trading as a hobby because they have a full-time job doing something else. However, If you treat trading like a business, it will pay you like a business. If you treat like a hobby, hobbies don't pay, they cost you...! Disclaimer. I am not sebi registered analyst. My studies are for educational purpose only. Please Consult your financial advisor before trading or investing. I am not responsible for any kinds of your profits and your losses.
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NSE:NIFTYEducation
by RK_Chaarts
23
Stock Company. Selling something that no one will buy piecemealSo, here we go. Start of the story here . What next? How will he sell something that no one will buy in pieces? He turns his company into a joint-stock company, which is a form of company organization that allows it to be split into shares. Our owner issues 1 million shares, that is, he sort of divides the company into 1 million pieces. Then he calculates how much his whole business is worth - let's say $1 billion. And if $1 billion divided by 1 million shares, you get $1,000. That's how he calculated the value of 1 share. Recall that our owner has decided to put only 25% of his business up for sale, that is, 250,000 shares. And if we multiply 250 thousand shares by the price of $1 thousand, we get $250 million in total - this is the value of the share of the company he plans to sell. Now he has to decide: will he sell 25% of the shares to one or more buyers, or even an unlimited number of people. First, he was approached by one large investor who has $250 million to buy all 25% shares. But the investor shared with the owner a plan to grow the company and asked him to place his managers in high positions. The owner of the company didn't like it because he didn't want to lose control of the company, so the deal didn't go through. Then he was approached by several investors who promised him they would stay out of the company's business, but were willing to buy a 25% stake not for $250 million, but for only $200 million. That option did not suit the owner either. Then he decided this way: instead of negotiating with big buyers, I will offer my shares to anyone who is willing to pay 1 thousand dollars for 1 share. This offer is called IPO (initial public offering) . Remember this term, because you'll come across it quite often. Our owner had agreed with the banks from which he borrowed money, that for a small commission they would sell his shares at $1,000 apiece to absolutely any buyer. But the first buyer asked the bank the question, "What's in it for me to own one share?" Through this question, we come to the point where we find out what owning stock gets us. The bank answers the prospective buyer that: - You will be able to manage the stock company by voting on matters of the general meeting of shareholders. The weight of your vote will be one in a million votes. - You will be able to receive dividends if a majority of the general meeting of shareholders votes "yes" to pay dividends. - If the company goes bankrupt, you will receive one millionth of its assets left over after all of the company's debts to banks have been paid. The buyer decided he was being mocked and rejected the offer. After all, why should he have the right to vote if 1 his vote means little in the overall background. Why does he need dividends if they may not be assigned. Why would he need property that would be impossible to sell after bankruptcy. But more about that in the next post.
NSE:TATAMOTORSEducation
by Be_Capy
What is a stock? Let me tell you a storyNow let's talk about what a stock is, why companies issue them, and why they attract investors. To do this, imagine a story. Imagine a small shoe workshop with a single owner. Suppose he makes boots out of crocodile leather. His product is unique to the city and in demand, because these boots are very durable and comfortable. At this point, he can only produce one pair of boots a day, and the number of orders for boots is 2 pairs a day. To meet the demand of his customers, he hires an employee and buys twice as much crocodile leather and other necessary materials for the job. With what money? With all the profits previously accumulated. The workshop now meets the demand of two pairs of boots a day. Later, the workshop receives a corporate order for 90 pairs of boots per month. In order to meet the new order, three more pairs of boots must be produced in addition to those two. But with what money to buy so many materials and hire three more employees? After all, even all of the previously accumulated profit is not enough for such a batch. In order not to miss out on a major customer, the workshop owner goes to the bank for a loan. The bank is happy to give him a loan secured by the workshop (which means that if the owner will not repay the loan, his workshop will be taken away). But all goes well, the owner hires three more workers, buys materials, and puts out five pairs of boots a day. With the proceeds, he pays the loan and interest. Now, let's go back to that beautiful day when the shop received an order for 90 pairs. The owner could have declined the loan and waited for the accumulated profit, but to do so he would have had to negotiate with a potential buyer for a longer lead time for the entire batch, and that could have resulted in the loss of the order. What it turns out: he needed the credit in order to ramp up production quickly, and thus the size of the business. Taking advantage of the credit and constant demand, our workshop owner goes nationwide and becomes the most famous manufacturer of crocodile leather boots with many workshops all over the country. And a lot of people around him want to buy the successful business. Then he starts thinking: on the one hand, he has a huge business that is profitable, and on the other hand, he has an opportunity to get money in exchange for workshops, stock of materials, employees' labor, business connections and reputation. In short, in exchange for everything he has created with his own hands and head, which is very difficult to sell individually. He likes the idea, but in order to keep part of his business, he decides that he will sell only a share of his company - 25%. He did the math and realized that this money is enough for the rest of his life (and even to live another life). What next? How does he sell something that no one will buy in pieces? Let's continue next time.
NSE:HDFCBANKEducation
by Be_Capy
Alerts: 3 reasons they can make you a better traderHey Everyone! 👋 We hope you’re enjoying Black Friday week and have helped yourself to some of the great discounts we are offering. We only do this once a year, so it really is the best time to get a plan! Now, let’s jump into today’s topic: Alerts. While alerts have a ton of potential applications when it comes to trading, they are often underutilized because it can take some time and ingenuity to build a system where they can work well. Let's take a look at some reasons why that investment is well worth it. 1. They can help build good habits 💪 Stop us if this sounds familiar: you hear an awesome investment story, and then immediately go out into the market and purchase the asset, with no plan in place. While this can work, it’s not a great strategy for long-term success, because in reality, it can be extremely hard to sit in that position without a plan and trade it efficiently. You may choose to exit the position based on nothing more than momentary greed or fear, and moves like that can prevent consistency and long-term profitability. Alerts are great because they can take out the guesswork of entering and exiting a position. Simply set alerts for the prices you would like, then place a trade if, and only if, the conditions are met. Then, let the market do its thing and let the probabilities work in your favor. Alerts can turn the experience of trading from a constant search for ideas - and always feeling behind - into a relaxing job of waiting for your own pre-approved conditions to trigger before taking action. In short, alerts can make you much more well-prepared for the market’s ups and downs. 2. They increase freedom and reduce anxiety 🧘 There is a well-known maxim in trading and in life that states that negative emotions are felt twice as strongly as positive emotions. This factoid has lots of applications, but it can be especially useful to understand as a trader. Consider the following investors: - A dentist who checks quarterly reports from his brokerage - A position trader who checks his positions once a month - A swing trader who checks his positions once a week - A Day trader who checks his positions once a day, if not more Given the natural volatility that markets experience, which market participant is least likely to be mad or upset? The dentist. Why? Because he is receiving fewer data points from the market. Even world-class day traders are exposed to tens or hundreds of negative situations in their positions on a day-to-day basis as a result of volatility, which they cannot control. This level of negative stimulation can reduce mental health and trading effectiveness. Alerts allow well-prepared traders with some edge to step back from the markets and allow the trades to come to them. 3. Our alerts don’t let anything fall through the cracks ✅ While the previous two points are benefits when it comes to price alerts, our alerts also step the game up considerably when it comes to user utility. Once you have setups that you like to trade, you can set alerts on trendlines, technical indicators, customizable scripts, and so much more, so you can ensure that your favorite setups aren’t being missed. This can be as simple as a long-term investor setting RSI alerts on Dow 30 stocks, in order to buy dips in strong names, to as complex as an intraday futures spread scalper setting alerts for pricing inefficiencies within his top 40 contracts. Our customizable alerts can really allow well-organized traders to capture every opportunity as they see it. And there you have it! 3 reasons to take advantage of alerts, and all of the awesome benefits they bring. Thanks for reading and stay well! Love, Team TradingView ❤️❤️ Do check us out on YouTube and Instagram for more awesome content!
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Education
by TradingView
5
The lifestyle of your savings, and why Big Mac?I've mentioned the word "risk" many times before, and it really is a very important word in the investment process. Today I would like to focus on a risk that you should pay much attention to as a future investor: market risk, or in other words, the risk that you will have to sell the shares you bought cheaper than the price at which you bought them, and suffer a loss in doing so. You will face this risk all the time, which is absolutely normal, because at any time events can happen which will cause the value of the stock to fall. It can be said that investing in stocks is a series of profitable and unprofitable operations. So don't get discouraged and pour ashes on your head if your first trades are unsuccessful. That's part of the process. Investing is not a one-time transaction to make a quick profit, it's a way of life for your savings. Remember the fundamental and simple rule of investing - the expected return is roughly equal to the risk you take. So, when you place money in a bank deposit, the only risk you take is that your money will depreciate by the difference between the rise in prices and the deposit rate. The easiest way to explain this is with Big Macs. Let's say you have the money to buy 100 Big Macs. But you don't spend it, you put it under your mattress. A year later, because of a price increase of, say, 7%, you can buy not 100, but 93 Big Macs with the money from under the mattress. Every time you put money "under the mattress," you reduce the purchasing power of your savings. To preserve it, you can put your money in a year's deposit at the bank. That way, in a year, you'll withdraw the original amount from the deposit, plus a profit in the form of interest. Even if prices go up, as in the last example, you can buy 99 Big Macs, not 93. Why not 100? Because the interest rate on a deposit is usually less than the percentage increase in prices (that is, inflation). In our example, it was 6% versus inflation of 7%. If you choose not to keep money "under the mattress" and not to open a deposit, but to invest in stocks, then at the end of the year you can buy, for example, 150 or only 50 Big Macs, because you are dealing with a potentially more profitable and therefore more risky instrument. This is how the fundamental law of investing works, let me remind you again: as much risk as possible profit. Thanks to this law we can refine our formula: investing in stocks is buying a share of a company with the goal of getting a future profit from its sale and being aware of the risk of a possible loss. Awareness of the risk of possible loss is an obligatory variable of our formula, an obligatory ingredient of our investment recipe. Awareness of the problem is already a big step towards its solution. It's impossible to completely eliminate risks, but with proper management their impact can be minimized. So, after studying the entire series of posts, you will get the necessary knowledge and practical skills to: - find shares of companies interesting for investment; - evaluate the financial condition of companies; - determine the conditions for buying stocks; - determine the conditions for selling stocks; - manage risks; - take into account the results of your operations. You will have a ready-to-use strategy that will always help you find the answer to what to do or not to do with the stock at the current moment in time. You will not have to chain yourself to the monitor and do it all your time. You won't spend any more time doing it than you do watching the news or social media. You will learn to think like a intelligent investor, and you certainly will become one, if you are prepared to open yourself up to a very interesting and fascinating field of knowledge - stock investing. I sincerely wish you success on this path!
NSE:NIFTYEducation
by Be_Capy
Raising initial capital: 4 approaches, of which one is not goodLet's break down the thought from the previous post in more detail. Obviously, to buy stocks, you have to have money, and if you are determined to become an investor, get ready to open your piggy bank. If you don't have savings, however, don't despair, there are other options. I suggest you look at the following 4 options for acquiring the finances to buy stocks: - Reduce your current expenses - Sell unnecessary assets - Increase your regular income - And the option I don't recommend using at the start is to borrow. I immediately stipulate that it is your, and only your responsibility how to apply the knowledge gained - to use something of the proposed or to go another way. I do not insist on anything. Rather, I am sharing information, but the decision is up to you in any case. My opinion - always start with reducing your current costs, because the funds you save now give you a chance to increase your wealth in the future through investing. Make it a rule to plan your purchases in advance and buy only what is on your list. Don't go to the store without a list, otherwise you will buy more than you really need. Next. Look at your possessions. Make a list of what you can sell without compromising your financial and mental well-being. Let what you don't need now serve to increase your wealth in the future. Increasing your regular income is probably the most time-consuming but feasible way to accumulate funds for investment. Many people are often faced with the problem of choosing between a job they love where they don't earn enough and a job they hate with a higher income or, even worse, a job they hate with a paltry income. In the latter two cases, I recommend becoming an active user of services that will help you find the job you want (but don't act in haste, don't quit a job you don't like right away). Remember our goal is to keep and increase our income, not lose it altogether. In the case of a job you love and don't make much money, think about how you can increase your income in your current job. Sometimes all you have to do is make up your mind and ask your employer for it. Even a small increase will help you start saving. And if you have both a job you love and a desired level of income, I congratulate you, you are truly lucky. Moving on. Borrowing for investments is the riskiest option. I highly do not recommend it, especially at the beginning of your investing journey. You definitely should not take a loan from a bank or other financial institutions. The credit rate will only increase your costs, and the need to repay the loan every month will break your entire investment strategy. If family, friends or acquaintances are willing to lend you money long-term and without interest, think about whether your lender is aware of the risks and whether you are aware of the risks associated with investing in stocks, and whether this person will demand the money back before the agreed upon deadline. Even if you have agreed on everything, write down all of the terms of such a private loan on paper, so it is easier to resolve any disputes. I always insist that the investment is conscious, that you understand and are ready to bear the responsibility and risks. So if you have even the slightest doubt about the borrowing option - don't take it! Consider another option. Ideally - work out a step-by-step plan and accumulate the necessary amount of money gradually.
Editors' picks
NSE:BANKNIFTYEducation
by Be_Capy
2
Investing is the ability to say "no" so that you can say "yes"Have a wonderful day, my dear friends! Let's get acquainted. My name is Capy. Someday I will tell you my stunning life story, and how fate has tied me to investing. I can't quite believe it myself sometimes... But that's not what today is about. Today I'm starting a series of posts to introduce you to my vision and strategy in the very multifaceted and insanely interesting topic of stock investing. Let's start by figuring out why you should be an investor? Many people think that investors are some kind of Wall Street wolves who trade stocks of companies and make unimaginable amounts of money on it. I'm sure there are those too. But, in fact, investing has long ceased to be the monopoly of the employees of banks, brokerage companies or big businessmen. Investing is available to absolutely everyone who plans their wealth and has the basic knowledge obtained at university. Or aspires to learn this indomitable beast. This is the reason I started this blog: to help everyone who wants to understand and share my ready-made strategy that you can apply in the process of investing. It's worth saying that every one of us has done the act of investing at least once in our lives, perhaps without even realizing it. For example, when placing money on a bank deposit (the well-known bank deposit), renting out real estate, opening a business or just learning. All these actions have one common formula: you give something away now in order to get it back in the future and, in addition, to make a profit. When you rent out an apartment, you cannot live in it because you have given it to other people to use. But when the lease expires, you'll get your apartment back, plus a profit in the form of the rent you've been receiving all that time. When you start a business, you put money into it so you can pay it back later through the proceeds. And, of course, you expect the returns to exceed the costs invested. When you invest in education, you plan to use what you have learned to achieve something, whether it's getting a job or enriching your inner world. It is the expectation of profit that is the main motivating factor for the investor and the main purpose of the investment. If you give someone an apple and they give it back to you after a while, that's not an investment. And if you give someone an apple, and after some time you get two apples back - you are already an investor, because you made a profit in the form of an additional apple. The upcoming series of posts will focus on one of the investment options - namely, investing in stocks of companies. I plan to teach you how to approach each trade wisely and in a measured way to keep you from engaging in short-term speculation that looks like a casino game. Going back to our formula, a stock investment is a transfer of your money to a particular company in exchange for a stake in its business. The purpose of these actions is to make a profit in the future from the sale of the shares (in the case of buying cheaper and selling higher), or the second option - to receive dividends. Dividends are when the company shares with you a portion of the profits in proportion to your share in the business. But we will focus on the first option to make a profit, that is "buy cheaper - sell more expensive". And the dividends to consider as a nice bonus to this strategy. I will publish a new post soon. Let's talk about approaches that will allow you to find funds for investment.
NSE:RELIANCEEducation
by Be_Capy
1
Introduction to Volume profile If you have been in the market for some time, you may have heard of a study called the “Volume profile” . Today we are going to take a deeper look at volume profile, along with a few example strategies. This post will also lay the groundwork for future posts about more advanced volume profile topics. Please remember this is an educational post to help all of our members better understand concepts used in trading or investing. This in no way promotes a particular style of trading! The post will shed some light on the following topics: → What is volume profile? → Difference between traditional volume indicator and volume profile → Volume profile terminology → Different types of volume profiles → Example strategy 👉 What is Volume profile? Volume Profile is an advanced charting study that displays trading activity at specific price levels over a specified time period. On the chart, it plots a horizontal histogram to reveal significant price levels based on volume. Volume Profile, in essence, takes the total volume traded at a specific price level during the specified time period and divides it into either buy volume or sell volume, making that information easily visible to the trader. 👉 Difference between volume profile and traditional volume indicator The core difference between the traditional volume indicator and the volume profile is how they consider volume with respect to time and price. The traditional volume indicator plots histograms at specific times, without giving any relevance to the price levels. On the other hand, the volume profile gives importance to price levels without emphasizing on the time scale. 👉 Volume profile terminology ■ Point of Control (POC) – The price level for the time period with the highest traded volume. ■ Profile High – The highest reached price level during the specified time period. ■ Profile Low – The lowest reached price level during the specified time period. ■ Value Area (VA) – The range of price levels in which a specified percentage of all volume was traded during the time period. Typically, this percentage is set to 70% however it is up to the trader’s discretion. ■ Value Area High (VAH) – The highest price level within the value area. ■ Value Area Low (VAL) – The lowest price level within the value area. ■ High Volume Nodes (HVN) – Peaks in volume around a price level. ■ Low Volume Nodes (HVN) – Valleys in volume around a price level. 👉 Different types of volume profiles TradingView currently provides 5 types of volume profiles. These are: 1. Auto anchored - Specifies the anchor of the volume profile calculation, i.e. how often the volume profile recalculates and where it starts. 2. Fixed range - Builds a profile using the custom anchors provided by the user. 3. Periodic - Sets the period for which the indicator builds volume profile, one profile for each new period. 4. Session (Normal and HD) - SVP displays a profile for all the market action that occurs within a session. If set to "All" (default), the indicator will consider the pre-market, main trading session and post-market as one session. 5. Visible range - Builds a profile considering all the visible data on the screen. Please note that the Volume Profile is a paid-only feature that can be accessed by subscribing to one of our paid plans. If you need to upgrade your account, be sure to check out our Black Friday sale . You can get up to 60% off on subscriptions. Example strategy Just like with most other tools or studies, Volume Profile has a number of uses. There are many trading strategies out there using Volume Profile as a key component. Below are the basics of one such strategy which is based on comparing the current day’s opening price to the previous day’s Volume Profile. 👉 If the current day opens above the previous day’s value area (but still below the Profile High) A sample setup is to look for the price to retrace back toward the Point of Control and then proceed to rise (the direction of the day’s open). Therefore during the retracement to the Point of Control, there is a buying opportunity. 👉 If the current day opens below the previous day’s value area (but still above the Profile Low) Some traders may look for price to retrace back towards the Point of Control and then proceed to fall (the direction of the day’s open). Therefore during the retracement to the Point of Control, there is a selling opportunity. 👉 If the current day’s opening price is completely outside of the previous day’s profile (above the Profile High or below the Profile Low) In general, this is seen as a possible runner in the direction of the opening price relative to the previous day’s profile range but different traders may look at it differently. Thanks for reading! As we mentioned before, this isn't trading advice, but rather information about a tool that many traders use. Hope this was helpful! See you all next week. 🙂 – Team TradingView Feel free to check us out on Twitter and Instagram for more awesome content! 💘
Editors' picks
NSE:ADANIENTEducation
by TradingView
23
NIFTY MIDCAP DIVERGENCENSE:NIFTY NSE:CNXMIDCAP NSE:CNXSMALLCAP Diverging for couple of days. Ideally the broad market shall start picking up. While Nifty is getting selling pressure near the Highs today. Midcap and Smallcap Index getting buying near support zone. Midcap and Smallcap shall start picking up from here on. The Broader Market Indices must converge with the Mainstream Index Nifty 50. Inter-market Divergence is not sign of healthy trend. Longer the time the divergence prevails it leads to trend reversal. As Nifty and Bank Nifty are near the Highs along with other Indices. Broader Market Indices and stocks shall pick up the trend now.
NSE:NIFTYEducation
by TrendonomicsHD
1
My crazy partner is Mr. Market!We are used to the fact that the world's most prominent investors are known for their outstanding deals, returns and stability of results over a long time horizon. Yes, all this is certainly a sign of excellence, but no investor has gained his popularity through books. The books he wrote. This man created his writings back in the 1930s and 1940s, but they still inspire anyone who has taken the path of smart stock investing. You've probably guessed by now who we're talking about. It's the humble author of The Intelligent Investor and Warren Buffett's teacher, Benjamin Graham. It's amazing that after many years, this book is still considered the bible of investing on the basis of fundamental analysis - Graham wrote such a thorough description of how a person investing in stocks should think. His insight into the market can be useful to anyone who is exposed to this chaotic environment. To understand Graham's philosophy, imagine that the market is your business partner "Mr. Market." Every day he stops by your office to visit and offer you a deal on your mutual company stock. Sometimes he wants to buy your stock, sometimes he wants to sell his own. And each time he offers a price at random, relying only on his gut. When he panics and is afraid of everything, he wants to get rid of his shares. When he feels euphoric and blind faith in the future, he wants to buy your share. That's the kind of crazy partner you have. Why is he acting this way? According to Graham, this is the behavior of all investors who don't understand the real value of what they own. They jump from side to side and do it with the regularity of a "maniac" every day. The task of the prudent investor is to understand the fundamental value of your business and just wait for another visit from the crazy Mr. Market. If he panics and offers to buy his stock at an extremely low price - take it and wish him luck. If he begs to sell him the stock and calls an unusually generous price - sell it and wish him luck. Of course, after a while, it may turn out that Mr. Market was not bad at all and made a very profitable deal with you. But the fact is that on the long horizon of time his luck will be washed away by a series of stupid things he will inevitably do. As for you, rest assured that tomorrow you will meet another Mister. So, as Graham has taught us, is teaching us, and will continue to teach us - you just have to be ready for it. Understanding the fundamental value of the company, this meeting will bring you nothing but pleasure!
TVC:DJIEducation
by Be_Capy
1
How to Study Price and Wave volume RelationshipHi 👋 In this post I would try to throw some light on the Price & Wave Volume relationship (popularized by late David Weis). This method may help trades in two ways: 1️⃣Ride the trend 2️⃣Picking the end of a rally I came across this chart randomly and found that there are a few principles that I can discuss with the help of this chart. Before reading any further I want to disclose that this technique was not originally developed by me. However, different authors may have different interpretations when it comes to some techniques of discretionary trading. This is a small piece of what I have learnt as a big follower of price action trading. I don’t want to go for bar by bar analysis here due to time and space constraints, so I have marked a few important places (as numbers in green rectangles) that are important and need to be discussed. The numbers in white are the cumulative wave volume in crores. This means just keep on adding the volume of each up bar until there is a reversal. I have taken the reversal a 2points on closing basis. Which means I keep on adding the volume until the price closes 2points below the close of the previous bar. The opposite is true for down waves. 🚀 Point1 If you look at the upwave preceding the downwave at point1, it is the sharpest of the rallies from March 2020 lows (scroll back the chart a bit). Also wave volume is the highest (37cr) compared to 10,19 and 18cr on previous upwaves. At point 1 there is 10cr volume on the downwave, which is the highest on any downwave in the rally from Mar2020 lows. This is an alarming signal that sellers are getting active. But this may not impress us to liquidate our trades as we need further evidence to confirm this weakness. 🚀 Point2 Here we have very high volume accompanied by the widest bar (in the rally) but closing in the middle. These three things confirm here that sellers have stepped in and the stock is weakening. 🚀 Point3 There is a rally back to the highs but this time with lesser volume (29cr compared to 37cr) than preceding rallies. This is our second confirmation that buyers are turning there back at this level, at least for now. This is a sure exit opportunity for investors who bought at the lows. 🚀 Point4 There was a sharp reaction with huge volume of 31cr and very wide bar, closing off of its lows. At this point there is still confusion that the trend has reversed or not. If it was a reversal then there would have been a follow through of 31cr volume on the downside but it is not so. For the next 3 days price sustained above the low of this wide downbar. 🚀 Point5 The sellers again tried to push to the stock down but look at the volume in this wave. Are you getting it now? Its just 13cr instead of 31cr on the last downwave. This infers here that seller are not interested. So if seller are not interested then what will happen? Buyers will take over. 🚀 Point6 The sellers tested the level of 1, 4 and 5 a few more times, buyers holds it and that develops a support. There was a very strong rally (compared to rallies in the last one year) back to the highs and volume is again 23cr which is lesser than volume at previous highs. Lesser volume could have 2 interpretations – there are less sellers this time and/or buyers are not interested. 🚀 Point7 The stock is back to the support again. But volume on downwaves is much lesser in relative terms. In fact, it decreasing from 13 to 4 and then 2cr (see chart). Where have the sellers gone? They don’t want to sell at the support. 🚀 Point8 Lack of selling leads to buying and eventually to new highs. Notice that there in very less volume at point 8 (only 4cr). This time sellers attempt (5cr) was failed quickly (without hitting support) and new highs were made outside resistance (developed at 2, 3 and 6). At this stage, when the price is closing outside the resistance, I would expect more volume to come in. More volume at this stage would indicate that buyers are interested but that is not the case here. 🚀 Point9 Point 8 looked like a failed breakout attempt. The price fell back into the trading range (between support and resistance). If I look at volume here, it is 15cr on this downwave. In the immediately preceding fall with 17cr it touched the bottom end of the range but this time with 15cr it is just at the middle of the range. This signifies re-accumulation at point 9. 🚀 Point10 Re-accumulation lead to a rally back into resistance. We have 13cr as of now. Its too early to say, before this upwave ends, but 13cr is less (for me at this point) to push it any further. It seems holding back in the range. 🚀🚀 Final thoughts This is a very nice and rare example showing both distribution (by the seller at resistance level) and accumulation (by the buyers at support level). Normally the price peeps outside the range on both sides and fails to follow through, until there is a decisive break on either side. I hope you learnt something new in this post. Now you can do one thing, press 🚀 to encourage me to write more educational stuff. Thanks for reading.
Editors' picks
NSE:ADANIPORTSEducation
by Bravetotrade
22
#crudeEducational video as how to identify a double top pattern. A double top is a bearish technical reversal pattern which is not so easy to spot as one needs a confirmation of a break down point. Question comes, How to identify the target of Double top pattern! After the confirmation of the pattern, your minimum target is equal to the size of the formation. In other words, when a stock breaks out of a double top formation, the price target is the range of the formation added to the breakout level.
MCX:CRUDEOIL1!Education
by CA_Chetanbhasin
Viewing Deep Preview on Fibonaccisjust now Hey Everyone, Today we are again with a lot of information and a bunch of topics, so consider following us for regular ideas and market updates Let's go Strictly into the idea So In the last idea we covered an overview but now lets cover a detailed view and even learn about Fibonacci Extensions, Fibonacci Number and Lines and more and more. What Are Fibonacci Retracement Levels ? Fibonacci retracement levels are horizontal lines that indicating where support and resistance can take place . Each level is having their own percentage. The Fibonacci retracement levels are 78.6% , 61.8% , 23.6% and 38.2% . But the most working levels of a Fibonacci are 38.2%, 61.8% and 78.6% . The indicator is very useful because it can be drawn easily and it can tell you many thing such as support and resistance . It can be drawn between high and low where the lines form is your support and resistances . What Are Fibonacci Extensions ? Fibonacci extensions is a tool that can be used to target Profit or approximate how far a price should travel after a pullback ends . Extension levels are also the areas where the price may reverse These levels are based on Fibonacci ratios . Common Fibonacci extension levels are 261.8% , 200% ,161.8% , 100% , and 61.8% . What Is the Fibonacci Number and Lines ? The Fibonacci Numbers and Lines the sequence of numbers , is a slowly increasing series where every number is the equal to sum of the preceding two numbers . We will meet you very soon so consider following you can unfollow us any time Thanks for reading it and giving it your time Bye 😁
NSE:NIFTYEducation
by MAYANKTECHRESEARCHING
1
Consistent Trader - Chapter 1Market has opened. Price is moving. You are watching the market. The question is, “do you live in present, understand the market or living in the present or future?” Everybody enters in to trading, thinking that it is easy to make money in share market. They never think to make easy money, one has to be a consistent trader and it takes time. The phases of a trader are Newbie – no knowledge, lot of expectations Senior newbie – Gain knowledge, less expectations. Intermediate – Unable to manage emotions during trading, good knowledge about trading. Expert – Good emotional & trade management skills. In these 4 stages, most people get stuck in intermediate phase. Why they get stuck there? How to cross that phase? This intermediate phase is important as it decides whether a person will become a consistent trader or not. The longer a person stays in this phase, the chances of him becoming a profitable trader reduces. Why ? Because the person will be repeating the same mistakes again & again creating it as a habit strengthening the neural pathways in brain and make it as a habit. People who do revenge trading, impulsive trading, over trading for many years enter in to this category. Can you avoid it? No. Every trader undergoes this phase. And in this phase only he learns the way to become a consistent trader. Do you have self destructive bad trading habits? What factors decide the duration of the intermediate phase? Exercise : Note down your self destructing trading habits. Review your trades to know it. (To be continued next week...)
CEducation
by vanathi
37
Price is what you pay, but value is what you getWarren Buffett is the most successful stock investor in the history of the world. Of course, which we know now. "The Oracle of Omaha" - that's what fans of his "magical instinct" call Buffett. But is that the point? As an 11-year-old child, little Warren was inspired by the possibilities of the stock market and invited his sister to participate in his first investment. These were preferred shares of Cities Service. The sister agreed to take the risk and Warren bought 3 shares at $38.25. But then, the wave of enthusiasm turned to disappointment and guilt - the shares fell to $27. Buffett's first investment "enterprise" lost 29% of the amount of investments that were borrowed. We can only imagine how the young investor felt at that moment, but I think this feeling is familiar to many: positive expectations clashed with the harsh reality of the stock market. Warren didn't sell shares. But when the price for them reached $40, he did it instantly. Apparently, considering this whole undertaking a mistake. The income was 4.6%, the sister received her money back. Everything worked out. Surprisingly, Cities Service's share price rose to $202 a few days later. Or +428%, Warren! The entire subsequent history of Warren Buffett confirms that he drew the right conclusions from the experience of his childhood. He realized that the price on the stock exchange may not reflect the value of the company itself. Buffett began to study accounting, the principles of fundamental analysis of enterprises, the ideas of Benjamin Graham. This allowed him to develop an approach that consisted in determining the real value of the company, different from the one that we see on the stock exchange. "Price is what you pay, but value is what you get". From myself I will add: and if the value is higher than the price - such an investment is considered reasonable. In the chart above, the price history of Buffett's main holding company, Berkshire Hathaway. As well as the S&P500 index. As you can see, his company "overtakes" the index, which means it shows much better performance than the average value of 500 US companies. Perhaps, in addition to deep analysis of the companies' business, Buffett's unique investor instinct helps, I don't know. But the fact that he is a real Wizard of our time is an indisputable fact for me.
NYSE:BRK.AEducation
by Be_Capy
Black Friday giveaway - Win a Pro, Pro+, and a Premium plan!Hey everyone! 👋 As you may know, we are having our Black Friday sale in the latter half of this month. So, to celebrate this, we are giving away a Pro, a Pro+, and a Premium plan to you, our community of traders and investors. All you have to do is subscribe to our weekly newsletter and join the family of over 2.9 million readers. If you’re already subscribed, keep reading to learn how you can win. What is our weekly community newsletter? Our weekly newsletter is built for one purpose: to keep you up to date in the markets. We include educational posts and ideas from our community, top scripts, an earnings calendar, an economic calendar, and more to prepare you for each week. How to subscribe to our weekly newsletter? 1. Go to the top right-hand side of your screen, click on the display picture, and then select “ Profile settings ”. 2. Then click on the “ Notifications ” tab. 3. Once you open the notifications, you will see various options under the “ Email preferences ” tab. Just check the “ Weekly digest ” option and save changes. That’s it, you are good to go! 4. Once you are done subscribing to the newsletter, just sit back, and relax. We send our newsletter each Monday morning and we’ll be sharing the contest details. Make sure to open the next newsletter! Set a reminder for Monday at 9 AM. When you receive our next newsletter, follow the instructions and you will be entered for a chance to win. We look forward to seeing you. Oh, and please feel free to send us any feedback about our newsletter. We especially want to hear if you enjoy it or if there’s anything you would like to see added! Let’s go! ❤ – Team TradingView
Editors' picks
NSE:BANKNIFTYEducation
by TradingView
10