Tuesday, December 12, 2006

Actions speak louder than words

Actions speak louder than words.
Should you counter-herd or follow the instinct of the herd?

The herding instinct in humans can have both positive and negative effects. Just because the crowd is chasing a particular counter does not mean you have to join the bandwagon.
Study your charts and follow your own judgment. Always think intelligently.

Charts are designed to track smart money. If you know how to read correctly, you can see all the actions. But if you misinterpret, you will have to bear the pain. It is not easy to become proficient in chart-reading. You will make many mistakes. Make you bets small initially, the smaller the better.

Charts are like electricity. If you know how to use them, there are very useful; very good servants but very bad masters.

To learn how to swim, you must go into the water. There is no other way. You may have learned everything on paper but you are sure to sink the first time you go in there. Paper-trade is only at best, a practice. In real trading, everything is different. Our emotions, fear, hope and greed all come into play. Experience is the best teacher. As the saying goes, “the proof of the pudding is in the eating”.

So much for now, and as usual, good luck and all the best.