The Market has the habit of Shrugging-off Weak Hands every once in a while by creating a "Panic Sell-Off" Scenario. The most popular arguments that we get to see are
1) Long Term Investors - Be Patient - ignore noise - avoid looking at markets daily 2) Traders - Every stock has to have a SL. Else short Term bets will turn long investments unnecessarily
While both statements have their credibility - only experienced people can understand the nuances between them - the Unspoken truth. Many Retail traders are very new and very naive - very much afraid and have very less capital to play around. Their main priority is to Save Principal - Decent Returns, but most of them end up in Loss.
Look at the 4 Indices shown - Nifty 50, Small Cap, Mid Cap, Nifty Energy - there are other indices as well - which CRASHED together on same day - Dec 20, Jan 23.
Should we Book Profits ? Exit in minimal Loss ? Hold indefinitely ? - These are the most debated topics and many "Smart" Investors think they are trying to Outsmart the Market, but Maha Guru Drona (Market) Teaches them a Very Serious Lesson
On Dec 20 - My Portfolio Crashed to -1.35 Lakhs by 10:00 am and within 2 Hours it recovered to -25000 by 12:00 pm. If we sold-off in Panic on the sudden fall - we would have become Crazy to see the recovery in 2 hours
On Jan 23 - My Portfolio Crashed to -1.51 Lakhs by Day Close. Jan 24 - It recovered +1.24 Lakhs and Jan 25 (Today) it gave me an additional +1.40 Lakhs. I recovered in just 2 days + I received 60% Additional Profit without doing anything
Really ??? Without doing anything ??? - Well the Answer is NO. I did NOT try to Outsmart by Guru because I realized the fact that even the Mighty - All Powerful - Smartest - Favourite Disciple Arjuna did NOT try to Outsmart / Kill his Guru. He used his skills to Defend himself and his Troops from the attack of Drona (Market).
You need the Support & Blessing of Krishna (God) + support of the Chosen one (Drishtadyumna) to Kill the Guru. Please realize we are neither God - nor the Chosen one. So Don't Try to Outsmart...But be a Loyal Disciple to the Market and Try to understand its Flow and Play alongside
So - What do we need to do ? The Answer lies in the Charts - as you can see - Despite the Massive Crash each day (Dec 20, Jan 23) - the Market rested just above their Support line.
Why Fear When Krishna's Support is Here - So we need to Check the Support and Resistances of Indices and also each of our Stocks in the Portfolio if any major supports are Broken and if the Next support is Near / Far. Exit your Stocks ONLY if the next Support is Far Away. Else, the Market would Rebound in no time - making you Crazy and pushing you to death
So the answer is to do Proper Homework - Not Blind Patience / Neither Panic Selling. Learn Technicals, Earn Good Wealth
Disclaimer:
Stocks-n-Trends is NOT a SEBI registered company. We do not provide Buy / Sell recommendations - rather we provide detailed analysis of how to review a chart, explain multi--timeframe views purely for Educational Purposes. We strongly suggest our followers to "Learn to Ride the Tide" and consult your Financial Advisors before taking any positions.
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