Saturday 10 December 2016

Understanding 'Day Traders' Psychology

Priyadarshee Goutam, an intraday trader uses maximum of 4 hours chart to 30 minutes to decide the trades to punch. He play in live market by analysing closely the candlestick formations on 4 hrs, 2 hrs, 1 hr and 30 minutes time period for point buying.

How he decides the trades?
  • He says he will be bullish if a formation in 4 hours is of hammer for next 5 hours
  • 2 hours doji will make him to go long or short for next 2 - 4 hours.

Entry Point
He usually enters trade by 9:20 am. At times, he waits for his point buying to avoid regrets of regression entering into market. Determining trend in first 5 mins is all predicted and predefined. His study includes everything mentioned below but not limited to
  • Previous day open, high, low and close of a stock 
  • Patterns for all time frames of previous day
  • Moving averages - 20 / 30 / 50 / 60 / 80 /100
  • Stockostics with fisher - Volumes with points
  • Fibonacci with regressions and upon that elliot waves
  • Trendlines 
  • Volumetrics

                  
On 5 mins timeframe
5 mins only they can trade who are investing 40% more of their margins and that too you can lose in next 5 mins are you ready to lose % of your risking cash in mins? If no, be happy with your paper trades.

He further alarms by saying 5 minutes trading is very risky. It requires five to six hours study on the buddy stocks. Continuous efforts is what brings confidence in Priyadarshee to punch the order in first 5 minutes of market opening.

His Predictions
He had predicted one month before the nifty levels of 7900-8000 much before experts came on television and talking about those levels. He has a nifty target of 6350 based on the 5 years time frame and Fibonacci study. In the next 6 months he says 8000 - 8600 is a confusion zone. Once failed 9000 is what can be seen easily.





To the new traders
It is a myth that people learn from other traders. People learn by themselves. By analysing which study worked for them and which one proved terribly failed. He says practice is the only thing. Do the paper trading and note down why, where and when to do trade. If you can risk your money proceed with punching else keep paper trading till the time you understand the market sentiments.


Success Formula
Sleepless nights. 15-16 hours study. More than 50 pdf and 3-4 books reading in a week. Months and months of failure. Falling into depression. Changing strategies. Studying deeper and continuously has bought him to this level

Failures do happen
He too has failed. Patterns ditched sometimes, while other times flank movement occurred. You cannot control that, however you can control your emotions and avoid being aggressive to remain in trade. Exit before it is too late.

He says what we think is not always right. In market we are risking our capital on a probability. Thinking might take you wrong. However, trend is your friend. It will take you along in most of the rides. And in which they give you opposite shocks, leave them alone.

Quotes
If you never failed, you never really tried anything new


It is not about how slow you go, just as long as you don't stop

Closing comments
Put your hard money in market once you are successful 95% or more times in paper trading. Being in markets is like both heaven and hell. Both doors are open for you, which one to enter in is your decision. Take the chance with real money when you are well prepared and can handle the risk of losing money. Akhilesh another trader says, pressing the "Buy" button and watching the MTM losing even a Rs. 10/100 can bring negativity. Entering and exiting trade frequently is a sure recipe for disaster.

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