Stockradar Stocks on the Move 22/8

Stockradar’s Weekly update on ASX stocks, the ASX/200, and overseas markets. Stock markets hesitate at their all-time highs while our reporting season brings on the good and the bad. Let price be your guide.

Stops-Trading Tool

The stop is a tool to take the emotion out of trading and provide risk and profit protection. Don’t kid yourself we all need them.

Stockradar Stocks on the Move 15/8

Stockradar’s Weekly update on ASX stocks, the ASX/200, and overseas markets. In the face of turbulent markets, it is important we stay cool, be objective and most importantly listen to our trade plan.

Stockradar Stocks on the Move 8/8

Stockradar’s Weekly update on ASX stocks, the ASX/200, and overseas markets. Gold, gold, gold and a clear cool head is what investors need in times of uncertainty.

The Miracle of Thought

The reality is human psychology drives stock price trends and we often see the power of our imaginations do amazing things, regardless of reality.

Stockradar Stocks on the Move 2/8

Stockradar’s Weekly update on ASX stocks, the ASX/200, and overseas markets. Leading stocks lift the ASX/200 into new high territory. No wonder 9 out of the top 10 stocks have qualified up trends and are Stockradar Stock Picks.

A simple ready reckoner of fund strategies for Australian Shares and the Australian Stock Market

The ‘which’ fund or portfolio strategy conundrum. Here’s some basic tips you should look at to open the right door.

Trading for a Living

Trading is easy, it is only ourselves that make it hard.

Cut your losses

A money management process that effectively cuts out the big losses and leverages stock trends

Market Psychology and our Human Behaviour

The miracle of thought

Our imagination can take us anywhere. The psychology of human behaviour that drives share prices is often a source of wonder. It’s challenging, its intriguing, it’s fascinating and its fun. No, not fundamentals, not news, not rumours but the psychology of how we perceive the myriad of complex variables.

The most interesting aspect of price movement is that which we cannot value. That is the blue sky of imagined possibilities. Don’t be left in the dark wondering why. Take the price at face value and follow it is the best advice I can give you.

Price discounting.

The price force we all try to understand,and we are usually dealt a quick lesson on how price behaves when we start trading. You know, the company delivers a great result and the price goes down. My initiation was when the bombs started going off in IRAQ in 1991 when the US invaded, I was well set in the gold market and feeling confident as it climbed steadily on expectations and when shots we’re fired gold plummeted. Ugh! My learning curve, buy the rumour, sell the fact.

You rarely make the same mistake twiceand are quick to understand one aspect of price psychology and that is one of expectations, and if your curious you will want to learn more about the advantage of understanding the price action, what drives it, how it behaves and most importantly, how to profit from it. Read, trade, and learn.

Price Excesses.

They occur all the time as prices exceed perceived fundamental valuationor in some cases trades well below it. Fundamental valuation is a marker to be exceeded or undershot for reasons of sentiment. Rarely do prices trade at ‘fundamental value’. So, overvaluation is driven by sentiment (as is undervaluation) and as humans go, in the right situation, they will believe anything can happen. We have endless examples of big momentum power moves of stocks and markets, and the reverse is true in some situations like the GFC.

Sentiment is a powerful force.The advantage price analysts have is that they follow human behaviour and are not pegged to the fundamental ‘value’. This frees us up to take advantage of the repeated excesses in markets, human behaviour, and price action. Excesses are opportunities and reflect momentum moves driven by human behaviour. They are valuing the invaluable and no-one can put a price on that.

 

It’s the crowd behaviour that gets us going and to a certain extent price can become almost irrelevant under these situations. The irrational crowd behaviour ‘scramble’ is a wonder for us all to see but there lies the big opportunity. It can also be dangerous I know as inevitably prices will correct but having a good awareness and when managed appropriately with the right discipline, they are opportunities that can be turned into profits.

These effects are history repeating itself, yes, but that history is driven by human behaviour and we all know we are creatures of habit. The price trend being the most common and oft occurring behaviour we can take advantage of. Price analysis is not about predicting the future it is about observing, identifying and following human behaviour that repeats itself.