Best Stocks to Trade For Tomorrow with logic 17-Jan | Episode 451

Open your Trading account in mintues with Zerodha

You can use Fibonacci Retracements to listen to what the market is saying. Listen to the market, it will often tell you where it’s going.

The market has fallen nearly 10% in the last few weeks. I’ve been watching the news very closely looking for signs that we’re near a market bottom. We’re close, and here’s why. First, consolidation can be a sign of a bottom. Second, watch closely when stocks move against the news. Third, and last, when the fed aggressively lowers rates we are near a bottom.

The January Barometer, a well-known indicator of market performance for the calendar year, suggests that this will be a disappointing year for investors in the U.S. stock market. Before you sell off all your investments, lets look at why this year may be different.

His explanation was simple. “We expect another leg-down in the markets.” I was floored by this answer. We have fallen about 2,000 points on the Dow, almost 15%. Yet, he expects the markets to fall further. He wouldn’t say much more, but a warning like that is very hard to ignore.

It’s close to the end of the quarter and suddenly some of the market volatility is making sense. I believe the recent rallies in the market are being caused by large funds dressing up their portfolios.

Now I look at the VIX every once in a while to get a grasp on market sentiment. I’ve noticed something recently. In the last few months the VIX has been heading lower. As a matter of fact, it’s fallen almost 45%. This tells me that investors are becoming less fearful. While never a perfect indicator, it could lead to higher levels in the major market indices in the coming months.

This story tells me fear is in the markets and blood is in the streets. And that’s when Buffet likes to buy and when he makes the big money.

First off, we have been warning readers of the danger in the markets for some time. The second part of my activity today is to short the US Dollar.

Looking at the technical analysis there was a pattern setting up. The stock’s in a confirmed uptrend, continuing to set higher highs and higher lows. It had pulled back recently on no news. My guess would be profit taking. Now it was trading near the low end of the range. It was a perfect trade, a perfect time to buy.

Invest stock is really something of a tricky business and when you want to do this, you need to be intelligent about how you trade and why you are trading in the first place. You have to approach the market in a serious way and when you do, you will be able to make more sense of the market and be disciplined in your approach. One thing you need to know that people at one point of time have started to gamble or developed a psychology of gambling at whatever they tried to do. For most it provides some sort of entertainment for them, a way for them to pass the time and make their lives more interesting, and the bad part of this is that some of them will make this into an addiction and can actually start to harm you.