August 28, 2016
Are you investing in a company when you buy stock or stocks? Well, if you are a trader, buying stock is nothing more than a bet on direction where your money will take you on the direction where you can profit from it.
There are many factors involved in driving the stock price. Such as economic news, announcements of the company or other companies in the same industry sector, political events, national money policy, global forecast, natural and weather.
Therefore, those who win and make money besides the skill in analysis, there are too many factors involve of that person.
Nevertheless, you must have the technical analysis skill, the way to read a chart and make a trading plan and strategy. At least you have a consistency way to do trade decision making.
Last you must also be aware that the financial markets are a zero sum game. You are compete with all level to take the money on the table. In fact, the stock market completes for money against the currency market, the property market, the bond market. The money will be flowing from one to the other.
In fact, buying a stock is like betting on the behaviour of the others in same market.
They are underlying forces driving the markets. If you are able to align with the forces, likely you can win and survive. This may be call riding the trend. This is regarded as the most important attribute of a trader.
Trading is a never ending struggle to find the right direction of the underlying forces. Especially for the currency trading, the news and the speech for those influential people are some important. Remember, the price can only do three things; up, down or sideways. You always have fifty percent chance to be wrong completely.
Trade with eyes open, chart will be your friend. Invest in a powerful charting software like AmiBroker.
Have fun!
Moses Stock Column
AmiBrokerAcademy.com