As traders are we actually able to anticipate market movements or are they truly random?
The balance of supply versus perceived demand becomes the basis of my market theory. The market is in constant shift between one state of balance and another and it’s these price movements that we look to capitalize on.
Over the years I have come to develop this ideology after studying how the market moves and how as individuals we respond to the market fluctuations.
The market price is the result of the balance of greed and fear by us, humans. Often times people view the market as this entity as if it is its own being with its own agenda, but we need to remember that the market is made up of us, the consumer, we are the market. It is form these principles that I have developed my market theory as outlined below.
- The market is unpredictable
- The market is ALWAYS right
- Trade with the market momentum
- The market continually retraces
- Old support acts as new resistance & old resistance acts as new support
- One trade won’t make you, but can surely break you
- Traders, being human act congruent with human behavior and human emotions
- There will ALWAYS be another trade
- The prepared trader has the greatest chance for success in the markets
- Remain objective – everything needs to be accounted for once the trade is placed
- Never stop learning, you are always a student of the markets
- No one can predict market moves
- Fear your loss might turn into a bigger loss, hope your profit may turn into a bigger profit (Jesse Livermore)
- Know thyself and thy personality
- Be patient with profits, quick with losses
- The markets are in a constant shift between two states of balance
- A man may beat a stock or certain commodity, but no man living can beat the stock market (Jesse Livermore)
- The one thing to never ever forget is that the market will take from you in an instant, that which you worked hardest and longest to obtain