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» CUBA FOUND A CANCER VACCINE! MORE THAN 4 THOUSAND PEOPLE HAVE ALREADY BEEN CURED BY IT!
Today at 11:38 am by Ethical Trader

» හදාගත් දරුවෝ: DNA බැංකුවට ශ්‍රී ලංකාවේ හා නෙදර්ලන්තයේ සහාය
Yesterday at 5:33 pm by Ethical Trader

» ෆයිසර් මුස්තාපාට එරෙහිව විශ්වාස භංගයක්?
Yesterday at 2:52 pm by Yin-Yang

» 'සිම්හල ද්වීපයේ පද්මාවතිය' හා අර්බුදයට මැදිවූ පද්මාවතී එක් තැනැත්තියක් ද ?
Yesterday at 1:22 pm by Ethical Trader

» ඉන්දියාව 'බ්‍රහ්මෝස්' සාර්ථක බව කියයි
Thu Nov 23, 2017 10:26 am by Ethical Trader

» How to Calculate the Future Value of an Investment
Wed Nov 22, 2017 11:46 am by Ethical Trader

» මුගාබේ ඉවත් වීමත් සමඟ 'හරාරේ' සැණකෙළි සිරි ගනියි
Wed Nov 22, 2017 11:34 am by Ethical Trader

» විසිපස් වසරක් ගෙවුනත් ඉල්ලීම් ඉටුවී නැහැ - නිදහස් මාධ්‍ය ව්‍යාපාරය
Wed Nov 22, 2017 11:30 am by Ethical Trader

» Dividend Announcement
Wed Nov 22, 2017 11:21 am by Ethical Trader

» කොටස් වෙළෙඳපොළේ ලැයිස්තුගත කෙරෙන අලුත්ම සමාගම – LVL Energy Fund Limited
Mon Nov 20, 2017 7:42 pm by nihal123

» අගමැති රනිල් බැඳුම්කර කොමිසම හමුවේ පැවසුවේ මොනවාද?
Mon Nov 20, 2017 7:08 pm by Ethical Trader

» Obituary Notice.
Mon Nov 20, 2017 3:03 pm by කිත්සිරි ද සිල්වා

» උතුරු කොරියාවේ "සබ්මැරීන බැලිස්ටික් මිසයිල වැඩසටහනකුත්"
Mon Nov 20, 2017 11:34 am by Ethical Trader

» උතුරු කොරියාව සහ න්‍යෂ්ඨික ප්‍රහාර: "නීති විරෝධී නියෝග පිළිපදින්නේ නෑ"
Mon Nov 20, 2017 11:28 am by Ethical Trader

» 'සොල්දාදුවාගේ සිරුරේ අඟල් එකොළහක පණුවෙක්'
Sun Nov 19, 2017 1:13 pm by කිත්සිරි ද සිල්වා

» මිනිස්සු දුවනවා, අපි නැවතිලා බලන් ඉන්නවා.
Fri Nov 17, 2017 5:46 pm by Ethical Trader

» Plantation sector updates
Fri Nov 17, 2017 11:54 am by lanka

» සිම්බාබ්වේ: ජනාධිපති රොබට් මුගාබේ "අත්අඩංගුවේ"
Fri Nov 17, 2017 9:54 am by Ethical Trader

» ආයෝජනයට ශ්‍රීලංකාවට එන්න එපා.! ජාත්‍යන්තර සමාගම් නිවේදනයකට සැරසෙයි
Wed Nov 15, 2017 8:15 pm by Admin

» Soldiers 'take over Zimbabwe broadcaster'
Wed Nov 15, 2017 5:52 am by කිත්සිරි ද සිල්වා

» බටහිර ලෝකය භේද කරන බවට රුසියාවට චෝදනා
Tue Nov 14, 2017 5:26 pm by Ethical Trader

» යුද අපරාධ සහ අතුරුදහන් කිරීම්: ශ්‍රී ලංකාවේ මානව හිමිකම් වාර්තාව ජිනීවා විමසුමට
Tue Nov 14, 2017 10:56 am by Ethical Trader

» ඉරාන, ඉරාක භූමිකම්පාවෙන් 200 කට වැඩි පිරිසක් මරුට
Mon Nov 13, 2017 5:27 pm by Ethical Trader

» මැද පෙරදිග බල තරඟය දරුණු අතට හැරෙයි
Mon Nov 13, 2017 3:16 pm by guruji

» වචන නම් අපේ ඒත් තනුව ?????????
Sun Nov 12, 2017 2:28 am by Rana

» දිල්ලියේ පරිසරය රැකීමට වාහන සලාක ක්‍රමයක්
Fri Nov 10, 2017 7:05 pm by Ethical Trader

» අයවැය සහ මෝටර් රථ: නව පිළිවෙතක්
Thu Nov 09, 2017 5:42 pm by Ethical Trader

» Flying is the Safest mode of Transport
Thu Nov 09, 2017 3:12 pm by කිත්සිරි ද සිල්වා

» In the Meantime, Within Our Shores !
Thu Nov 09, 2017 10:13 am by කිත්සිරි ද සිල්වා

» වංචා දුෂණ නඩු කඩිනම් කරන්න විශේෂ මහාධිකරණයක්
Wed Nov 08, 2017 4:54 pm by කිත්සිරි ද සිල්වා

» LIOC.N0000 (Lanka IOC PLC)
Wed Nov 08, 2017 4:48 pm by Ethical Trader

» ගින්නෙන් දැවෙන අලි පැටවාගේ සේයාරුව පළමු තැනට
Wed Nov 08, 2017 4:35 pm by Ethical Trader

» 10 Things to Remember Before You Take Things Personally
Tue Nov 07, 2017 5:38 pm by Ethical Trader

» හැම තැනම නැහැ, හැම දාම නැහැ
Tue Nov 07, 2017 5:30 pm by Ethical Trader

» Beware !
Mon Nov 06, 2017 10:56 am by CK

» සාම සාධක මෙහෙයුම් නිරීක්ෂණය කරන පළමු ශ්‍රී ලාංකික හමුදා නිලධාරිනියෝ
Sun Nov 05, 2017 12:44 pm by කිත්සිරි ද සිල්වා

» How to Find Undervalued Stocks and Turn a Large Profit
Sat Nov 04, 2017 11:24 am by Ethical Trader

» ඒකාබද්ධ විපක්ෂ කණ්ඩායමෙන් ශ්‍රීලනිපට කොන්දේසි හතක්
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» Taste of Asia
Thu Nov 02, 2017 12:27 pm by Ethical Trader

» නිව් යෝර්ක් ප්‍රහාරය : අවම වශයෙන් 8 දෙනෙක් මරුට
Wed Nov 01, 2017 5:48 pm by Ethical Trader

» NTB.N0000 (NATIONS TRUST BANK PLC)
Wed Nov 01, 2017 5:43 pm by Ethical Trader

» Laughter the Best Medicine
Wed Nov 01, 2017 11:48 am by Ethical Trader

» VPEL.N0000 (VALLIBEL POWER ERATHNA PLC )
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» TJL.N0000 (Textured Jersey Lanka PLC.)
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» TPL.N0000 (TALAWAKALE PLANTATIONS )
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» BFL.N0000 (Bairaha Farms PLC)
Tue Oct 31, 2017 7:16 pm by CK

» LLUB & BFL
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» HUNA.N0000
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» Sri Lanka's got Talent
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» Govt.electrocutes CEB
Mon Oct 30, 2017 9:53 pm by AjithR

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Are We In A Bull or Bear Market?

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Are We In A Bull or Bear Market?

Post by nihal123 on Wed Jul 05, 2017 11:21 pm

Don't Predict: It Will Bias Buy/Sell Decisions


Are We In A Bull or Bear Market?

By Dr. Winton Felt


People often ask and pundits often debate the question: "Are we in a bull market that has just had a correction, or are we seeing the beginning of a new bear market?" People seem to debate such questions endlessly in the media and on Internet forums. Trying to predict the market is fun and can sometimes be satisfying to the ego. It is enjoyable to talk about such things at gatherings or around the water cooler. It gives a person a chance to look bright or knowledgeable. We all like to seem intelligent..

However, it is not intelligent for a trader to indulge in such activities. In fact, it is a big mistake for a serious trader to do so. Why? It entices the trader to develop a market bias. That is not all that it does. When the trader expresses an opinion to others, the trader then has a vested interest in that opinion being right. It reflects on his intelligence and expertise as a trader. That bias can influence decisions about buying or selling. When a position deteriorates, the trader might be more inclined to "hold and hope" rather than sell. If his opinion had not been aired publicly, he might sell more quickly.

Our own traders know that the most consistently profitable traders are those who have learned to live in the present. The trader should be focusing on "what is" rather than what he or she thinks "ought to be." Market conditions are constantly changing. A trader's perspective on a stock can change dramatically in a matter of minutes or even seconds. The trader can be more nimble with a mind that is flexible and free from the shackles of ego-satisfying pronouncements.

Let's assume that the market has just had a sharp decline and that we conclude it is a bull market correction rather than a new bear market. The opinion that the decline is only a bull market correction has nothing to do with how we trade. We do not invest with the notion that the market is about to rise because we believe it is, after all, a bull market. Instead, we focus on what the primary trend is right now. For us, the primary trend is currently down, and it will remain down until it becomes flat or until it is no longer down, and it will remain in that condition until it changes again. The primary trend is the trend that is most important to your investment time-horizon for a particular investment. For example, if you are looking to capture the gain a stock makes in a week, then the fact that its 200-day moving average is declining may not be particularly important to you. However, a declining 20-day average could be very important. If the 200-day average is declining but the 20-day average is rising, then you might buy a stock that gaps above the upper boundary of a trading range on a 100% increase in volume. If you are looking for a gain of 5% or more in a week or two, the fact that the 200-day average is in decline may be irrelevant to you. On the other hand, for a long-term holder a rising 200-day average could be very important. That person might consider it irrelevant that the 10-day average is declining.

Our own stockdisciplines.com traders tend to use the 50-day moving average as an indicator of the general direction of the market. Within the context of that direction, there may be counter-currents. For example, we may have a declining 50-day average but a 20-day average that has started to rise. If the position we are considering is likely to be closed out in a week, then we may decide that the current trend is on our side. What we believe about the ultimate direction of the market is not important, nor is it relevant to what we do. What the market is doing right now with regard to the investment time-horizon for the stock under consideration is very important. Always invest with regard to the current context. Crystal balls are cloudy, sometimes deceptive, and always irrelevant when planning a trade.

Get more on this, and see a list of tutorials on disciplines for investors and traders.

http://www.stockdisciplines.com/bull-bear-market
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Re: Are We In A Bull or Bear Market?

Post by CK on Thu Jul 06, 2017 6:32 am

Thank you nihal. Good reading about trading and also ego.
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Re: Are We In A Bull or Bear Market?

Post by Yin-Yang on Thu Jul 06, 2017 2:22 pm

There are two sides guys.

It has always been a strong believer of one thing who would make extraordinary gains.

++++++++

On the other hand; it is the same with extra ordinary losers also.
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Re: Are We In A Bull or Bear Market?

Post by pjrngroup on Thu Jul 06, 2017 3:10 pm

Thanks Nihal.

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Re: Are We In A Bull or Bear Market?

Post by CK on Thu Jul 06, 2017 3:18 pm

Yin-Yang wrote:There are two sides guys.

It has always been a strong believer of one thing who would make extraordinary gains.

++++++++

On the other hand; it is the same with extra ordinary losers also.
True
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Re: Are We In A Bull or Bear Market?

Post by Ethical Trader on Thu Jul 06, 2017 6:29 pm

Thanks Nihal.
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