Few Days ago, when Nifty made a recent high of 6230 on 20th May,2013; again i started hearing a lot of voices from the analyst and technician community that breakout is happened on the upside and nifty is going to touch all time high in a few days and even few more enthusiastic fundamentalist started screaming that economy has bottomed out and we will touch 6900 or more in coming months.They were started giving n number of logic from liquidity to reforms for justifying their point. Once again i started hearing the great wisdom that this time is different from past.
But as our third law of Newton's Trading has clearly mentioned that in the stock market no stock, sector or overall market is different from the last time. Whatever has gone up, will go down for sure without an exception and vice versa. But just after three days, our market was trading at 5930 and people started getting bearish for short to long term because Fed governor has just made a statement that sooner or later QE will be stopped.
I am not advocating that market wont go up to the 6900 or 7900 level but what i am saying that i am trying to emphasize that market can not be in a secular bull run always and they will keep swinging from bull to bear phases. The trader and investor should not get carried away by the hoopla and be very cautious when putting their bet and also keep booking their profits if they made due to bull or bear run without believing the false saga of analyst that this time is different. Because market wont take more than few days to erase all the gains, a stock or market has made in past few months or years.
Wockhardt Pharma is a recent victim of this time different fairy-tale. Stock price moved from level of Rs. 270 in Jan,2013 to whooping Rs.2168 in March,2013 and if anyone would have invested in this stock in Jan,2012 then within a year, he would had made a killing. But if he had not booked his profit or used a proper stop loss strategy then stock is around 50% down from its recent high in within two months.
I can keep giving you the examples from recent fall in gold & silver to other so many stocks.
The simple point is that no time is different in stock market and keep swinging your position from bull to bear and vice-versa without giving heed to permanent bulls or bears.
But as our third law of Newton's Trading has clearly mentioned that in the stock market no stock, sector or overall market is different from the last time. Whatever has gone up, will go down for sure without an exception and vice versa. But just after three days, our market was trading at 5930 and people started getting bearish for short to long term because Fed governor has just made a statement that sooner or later QE will be stopped.
I am not advocating that market wont go up to the 6900 or 7900 level but what i am saying that i am trying to emphasize that market can not be in a secular bull run always and they will keep swinging from bull to bear phases. The trader and investor should not get carried away by the hoopla and be very cautious when putting their bet and also keep booking their profits if they made due to bull or bear run without believing the false saga of analyst that this time is different. Because market wont take more than few days to erase all the gains, a stock or market has made in past few months or years.
Wockhardt Pharma is a recent victim of this time different fairy-tale. Stock price moved from level of Rs. 270 in Jan,2013 to whooping Rs.2168 in March,2013 and if anyone would have invested in this stock in Jan,2012 then within a year, he would had made a killing. But if he had not booked his profit or used a proper stop loss strategy then stock is around 50% down from its recent high in within two months.
I can keep giving you the examples from recent fall in gold & silver to other so many stocks.
The simple point is that no time is different in stock market and keep swinging your position from bull to bear and vice-versa without giving heed to permanent bulls or bears.