Thread on sideways market:

Sideways price action or consolidation is a phase where institutional players are silently building their positions transacting in smaller quantities.

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What is orderflow trading and how to develop an edge using orderflow:
A thread 🧵
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#StockMarket

As the name suggests, orderflow is the flow of orders in a stock or index which are being executed in live market.

Normal candlestick shows the candle open, high, low and close but not the actual buyer and seller activity which is happening at every price point.

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Orderflow chart shows a deeper insight into a candle's price action by showing the volumes that are coming in at every price level.

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Why is this information important?
1. As a retail trader, we would like to follow the steps of large players and institutions and see whether they are more inclined towards longs or shorts.
2. OF data shows us the real time supply demand which is flowing into the market

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Improve your volume analysis using volume profile.

A thread on volume profile 🧵

Traditional volume indicator is widely used by almost every trader.

But it has a handicap: It shows volumes transacted from a time POV but not the price POV.

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This is what traditional volume analysis states. But in reality, how effective it is?

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It simply shows volume from a timeframe basis. 5 mins volumes on 5 mins TF and so on.

But, is there a different way to read volumes from a price basis? Like, where did largest buying or selling by big players come in?

Read to find more.

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This is where volume profile comes in. To put it in the simplest way, volume profile shows volume from a price perspective thus enabling a trader to identify where largest trading has occurred.

But how does this help a trader?

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If you can spot the areas where large volumes are being traded, you can spot areas of interest and effectively find areas of support and resistance.

Of course, it is volume that drives the price.

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How to build a successful trading mindset?

A thread 🧵

There is a lot of talk about trading mindset or psychology. But what exactly is trading mindset?

#StockMarket #trading

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Trading mindset is the state your mind is in, the thoughts that flow through you and the basis on which you take make various decisions about trading.

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More often than not, we know there are certain rules to this business, we know the rules we are supposed to follow to stand a chance to be successful in this business, but we are not able to.

Why?

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The problems most traders face are more or less similar but the methods or approach to solve it is different.

Because though the problems are similar, what triggers an individual to go down the wrong way or repeat the same mistake is different.

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So in this case, inward reflection to identify the key triggers and working on them with positive affirmations is required.

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Thread on fibs:

Part 1 - Fib extensions:

The way I use fibs and extensions differ from conventional textbook methods.

Fib extensions are ratios beyond 1 used to project targets for profit booking.

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The main purpose of fib extensions is to forecast probable (emphasis on both words) areas of profit booking/correction in a script trading in unchartered waters (ATHs and lifetime lows)

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Basically, they are used to find Ghost supports/resistances.

Fibonacci is a price based and a relative time based tool.

Meaning, the proper way to use this tool largely depends on the swing markers you use relative to the TF of your analysis and trading.

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The primary ratios I use as part of extensions are 1.382 and 1.618.

Example 1 for broader price range swing:

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Example for minor swing:
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While watching the GameStop stuff has been mildly hilarious (I mean who doesn't like watching the financial elite squirm?) it's pretty clear that a whole bunch of folk have convinced themselves this is ACTUALLY some kind of revolutionary activity. It isn't. 1/

Sure, it's highlighted yet another way in which the bastards profiteer but that's about it, stick it on the pile with the fifty other pro tips to keep the poor, well poor... It's todays banter and tho a few folks might have egg on their faces, literally nothing will happen. 2/

GameStop's three largest shareholders have earned £1.5bn+ during this. They sit at the top of some 200 institutions which are rolling. Meanwhile the ersatz rebels are now watching the bubble, realising there is profit to be made and having a wibble. 3/

No doubt some TRULY believe they are taking part in some kind of revolution but frankly it's utterly absurd and the vast majority are in it for the lulz and to cash in quick.

I'm sorry to tell you this, but you don't own GameStop.

4/

The reality is, the scale of the economic disparity and corruption is simply vast. Billionaires loosing a few millions means nothing. They buy one less yacht and you continue to live meal to meal.

The "Free Market" changes a few systems and the abuse continues. 5/

Indian Investing Conclave Day 1 @IIC_2020

:Route Mobile
:Philip Carbon Black
:Borosil Ltd
:Arvind Ltd
:Hawkins Cooker
:Repco Homes
:Shaily Engineering Plastics

Route Mobile @ravidharamshi77

Investment Hypothesis in CPaaS companies

:Crossed the technology adoption chasm
:Huge addressable opportunity - Industry growth estimates 30-50%
:Profitable Unit Economics, Cash Generating, Incremental Cost Low

CPaaS growing at 40%

Route Mobile

:Applications served by route mobile - Facebook, Instagram, Whatsapp, Google Pay to name a few
:Route mobile platform used for : 2 factor authentication, Notification for customer engagement across portfolio of apps

Route Mobile Key points

:Scaled upto 1200cr of revenue from internal accruals
:Huge runway for growth
:Multi geography and Omni-Channel presence
:Cash available for M&A
:Scope of margin improvement
:Demonstrated ability to move up the value scale

Philips Carbon Black @sarkaraniruddha

:Indias largest carbon black manufacturer
:Where is carbon black used, Tyre Rubber(73%), Non Tyre Rubber (20%), Non Rubber Speciality Carbon (7%)

Industry Size & Capacity Addition
1.3 Million Tonnes capacity and PCB has 43% market share

𝐑𝐮𝐥𝐞𝐬 𝐨𝐟 𝐈𝐧𝐯𝐞𝐬𝐭𝐢𝐧𝐠 𝐓𝐡𝐫𝐞𝐚𝐝
The entire thread summarizes some important rules with respect to investing. Inspired by legendary traders,these will not only help you to grow wealth,but also make a smart investor. Hope you would like the thread & shower some love

Rule 1: Bulls, Bears Make Money, Pigs Get Slaughtered so chose your category wisely
Rule 2: It's OK to Pay the Taxes,Dont just wait for a 10% LTCG always. Sometimes you know it won't pay you
Rule 3: Don't Buy All at Once,Have patience market will give enough opportunities

Rule 4: Buy Damaged Stocks, Not Damaged Companies. Understand the diff b/w undervalued stocks and no value stocks. Everything cheap is not bargain,it could be trap.
Rule 5: Diversify to Control Risk,make sure you don't put everything into one stock,one sector or one asset class.

Rule 6: Do Your Stock Homework. You spend 5 hours to buy a cream on Amazon but research for 1 hr based on buying a stock on twitter! Well,do your homework.

Rule 7: No One Made a Dime by Panicking .Invest 2-10% and leave rest. If it falls,pain will be low,if moves,no FOMO haunt

Rule 8: Buy Best-of-Breed Companies,This doesnt mean you have to invest in the most expensive companies,all it means is you need to buy co.s with good earnings,promoters and sustainability
Rule 9: Defend Some Stocks, Not All
Rule 10: Bad Buys Won't Become Takeovers,STOP hoping

CHEAT-SHEET

Multiple Confirmation short.

A Short Entry that we shared in 2020.

Study it point wise.

1. Bearish Candle type and lowering of volume on Price rise.

2. OBV divergence.

3. Accumulation with Bearish candles and Volume increase on Price decrease.

STUDY IT!

Explanation

1. When price increases with a decreasing volume, it's bearish.

2. OBV, On Balance Volume should be correlated with price.
If price increases without similar increase in OBV, it's bearish.

3. During consolidation, if the volume increases during dumps, it's bearish

Thread on 'no stop loss', 'adjustments' and 'Risk'
----------------------------------------------------

Wanted to share my thoughts on this topic for a long time but this email sent by someone yday woke me up from slumber

Pls read the email 1st before delving into thread

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In the past 1-2 years, there has been a sudden surge of traders who just talk about theta decay, option selling, adjustments and stuff like that..

It is all fair as long as the trader knows what he's doing. But the reality is far from what we see/perceive...

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Many of these folks were told that one can 'adjust' their way out of any situation. Any sane options trader know that you cannot come out of any situation by adjustment

One of my friend used to do that(he is famous in options selling desi fintwit) for a long time until..

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..he realized that one cannot possibly do that and its gonna burn him one day. He's pretty smart and hence, he put a portfolio level SL & when that hits, he will stop dancing, gets out and calls it a day

So, risk is managed at account level and he is quite clear about it

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Unfortunately, 1000s of traders who does option selling(with adjustment) dont have this risk mgmt in place.

They think (i dont know if i had to call it false confidence or ignorance) their skills in 'adjusting' will take them ashore 😅

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