πͺπππ§ ππ¦ π£π₯πππ ?
Traders can be divided into 3 groups: buyers , sellers and undecided. Buyers want to pay as little as possible, and sellers want to charge as much as possible. Their permanent conflict is reflected in bid-ask spreads
1/n
ASK is what a seller asks for his merchandise.
BID is what a buyer offers for that merchandise.
A buyer has a choice: to wait until price comes down or pay what sellers demand. A seller has similar choice: wait untill price rise or accept a lower offer for his merchandise.
2/n
A trade occurs when there is a momentary meeting of two minds: an eager bull agrees to a seller's terms and pays up, or an eager bear agrees to a buyer's terms and sells a little cheaper.
3/n
The presence of undecided traders puts pressure on bulls and bears. Buyers and sellers move fast because they know that they're surrounded by a crowd of undecided traders who may step in and snatch away their deal at any moment.
4/n
The buyer knows that if he thinks too long, another trader can step in and buy ahead of him. A seller knows that if he tries to hold out for a higher price, another trader may step in and sell at a lower price.
5/n
The crows of undecided traders makes buyers and sellers more willing to deal with their opponents. A trade occurs when there is a meeting of two minds.
The only and the most important part to make money in trading is "RISK MANAGEMENT" π¨βπΌ
This thread will focus on "HOW TO MANAGE RISK IN TRADING"
1/n
Trading can be a great way to earn money, but it's also a risky endeavor. One of the most important aspects of successful trading is managing risk. Here are some tips on how to do that.
2/n
First, it's important to set a stop loss for every trade. A stop loss is a predetermined level at which you will exit the trade if it goes against you. This will help limit your losses and prevent you from losing more money than you can afford.
3/n
A super thread𧡠on "Different type of Chart Patterns"
In the stock market, chart patterns are graphical representations of historical price movements that can help traders identify potential buying/selling opportunities. Here are some common chart patterns that traders use 1/n
1. Head and Shoulders: The head and shoulders pattern is a technical analysis chart pattern that signals a potential trend reversal from bullish to bearish. It consists of three peaks, with the middle peak being the highest (the head) and the two side peaks being lower
2/n
(the shoulders). The pattern is formed when the price of an asset rises to a peak, declines, rises again to a higher peak (the head), and then declines again, and finally rises once more to a peak that is similar to the left shoulder (the right shoulder).
15. Learn about technical analysis: Learn about technical analysis, which is a method of evaluating stocks based on charts and indicators.
9/n
16. Understand fundamental analysis: Understand fundamental analysis, which is a method of evaluating stocks based on company financials and economic factors.
17. Invest for the long-term: Invest for the long-term and don't try to time the market.
10/n
18. Diversify your portfolio: Diversify your portfolio by investing in different types of stocks and other investments.
19. Invest in what you know: Invest in what you know and understand.
20. Stay disciplined: Stay disciplined and stick to your trading plan.
A thread𧡠on how to be a successful trader π
This will definitely give you a lot to learn and implement.
1. Learn the fundamentals and technicals: The first step to becoming a successful stock trader is to understand the fundamentals and technicals of the stock market. 1/n
This includes understanding the different types of stocks, how to read financial statements, and how to analyze trends and patterns.
2. Develop a trading plan: A trading plan is a set of rules that govern your trading activities.
2/n
It should include your goals, risk tolerance, investment strategy, and exit strategy.
3. Manage risk: Successful traders understand that trading involves risk. They manage risk by setting stop-loss orders and limiting their exposure to any one stock or sector.
A thread π§΅on my biggest learnings from the book "Trade Like A Stock Market Wizard"
This book mainly focuses on points that made @markminervini one of America's most successful stock traders. 1/n
A great introduction where the importance of endurance and sense of pacing is discussed.
Even Mark didn't started with success. He repeated the same mistakes that most of the newbies do. After years of study and practice he was able to achieve the super performance. 2/n
Mark was a school dropout at age 15. His thirst for knowledge made him succeed in life. But that didn't mean that he didn't studied. He studied more than 1000 books on investment in his life.
People will say"its gambling,its risky" but you have to show them that its possible 3/n