Nimish, I hope you are not looking for people in TJ to support your thinking. As a human being, we are tuned for this...i.e.to see the people around us with similar thoughts like ours. Unfortunately, that is demaging trait in trading.
If you have already setup your max pain limit of loss then take action when that limit is hit. You might be able to take loss of 5Lac that doesn't mean u shd wait till it reaches that level. After big loss, recovery would be difficult.
If you are not able to take the pain, then my suggestion will be to atleast cut your position partially, rather then fully. Try to see historical pattern in chart, and observe
- how much steep a fall could be
- what happens after that
- how much worse can it get in short term etc.
- what signals appear that indicate bounce is fizzling out and downtrend is again building up.
Based on that draw your OWN strategy to play in the market.
In my observations, all global markets have fallen 5 to 10% in last 5-6 days with no real bounce. Selling after selloff is typical trait of novice /immatuare traders. Even if market has to goto 4k level, it will not happen in one wave.. there will be bounces in between.
After such steep fall, bounce is inevitable but can't predict whether this will happen tomorrow or in next 4 days. Hence DON't be contrarian and build long position until u see some signs of bears disappearing. Bulls will keep showing up but they get beaten down again.
There could be bounce which might help you in cutting your loss. If my post make u think then do keep in mind that there are same 50% chance that the pain might get worse before it can get better.
Happy Trading.
If you have already setup your max pain limit of loss then take action when that limit is hit. You might be able to take loss of 5Lac that doesn't mean u shd wait till it reaches that level. After big loss, recovery would be difficult.
If you are not able to take the pain, then my suggestion will be to atleast cut your position partially, rather then fully. Try to see historical pattern in chart, and observe
- how much steep a fall could be
- what happens after that
- how much worse can it get in short term etc.
- what signals appear that indicate bounce is fizzling out and downtrend is again building up.
Based on that draw your OWN strategy to play in the market.
In my observations, all global markets have fallen 5 to 10% in last 5-6 days with no real bounce. Selling after selloff is typical trait of novice /immatuare traders. Even if market has to goto 4k level, it will not happen in one wave.. there will be bounces in between.
After such steep fall, bounce is inevitable but can't predict whether this will happen tomorrow or in next 4 days. Hence DON't be contrarian and build long position until u see some signs of bears disappearing. Bulls will keep showing up but they get beaten down again.
There could be bounce which might help you in cutting your loss. If my post make u think then do keep in mind that there are same 50% chance that the pain might get worse before it can get better.
Happy Trading.