When to buy stocks?

[amiuser]

I am facing a trouble ...when I buy stock for positional trading based on daily chart ..after that if the market starts falling ...stocks also goes down...and I run into losses.

should I follow any timing to buy stocks ?

experienced members please guide. I am trying to improve this area.

Do you consider indices impact before buying stocks ?

However ...commodity and forex market does not have this kind issue because there is no impact of indices over individual assets

 

[amiuser]

senior members ... comments please

 

[coolcup]

If people knew when to buy stocks do you think they would share it with you on a forum???

Seriously, though, there are a variety of methods. It depends whether you are technically focused or fundamentally focused or a combination; your time horizon; your return expectations; do you invest in large caps, mid caps or micro caps? There are too many variables to give a sensible answer to your rather broad question.

 

[amiuser]

If people knew when to buy stocks do you think they would share it with you on a forum???

Seriously, though, there are a variety of methods. It depends whether you are technically focused or fundamentally focused or a combination; your time horizon; your return expectations; do you invest in large caps, mid caps or micro caps? There are too many variables to give a sensible answer to your rather broad question.

How long you have been trading ? are you profitable ?


Here is your answers :

I trade on daily chart.
I trade technical
1 month time horizon.
8% monthly return expectation.
invest in large caps..sometimes midcaps.

I provide answers to your queries .

what is your answer ?

 

[Smurf1976]

It depends on your method.

Personally, I make investment decisions based on fundamentals of the business itself and use very basic T/A to time the actual entry / exit.

 

[amiuser]

It depends on your method.

Personally, I make investment decisions based on fundamentals of the business itself and use very basic T/A to time the actual entry / exit.

Ok. .... Do you consider overall market index condition into your decision ?

e.g say market is very high ....if your T/A tells to buy stock ..do you still buy ?

all I am asking whether overall market condition has any impact on your trading decision

I see you are a very senior member and experienced person. Please throw some light

 

[rimtas]

The person who registered on site 10 years ago and has thousands of written posts on his behalf is not necessarily an experienced trader. Experienced writer-yes, for sure. It is just a notice....

And for the topic about when to buy stocks...there is one good sentence "buy when blood is on the streets". And I can add from myself another one: "When you catch yourself in a condition when you really under no circumstances can see that a stock can go up".
In other words-when a market movement puts a pressure on your decision making initiative and totally paralyses your finger witch you hold onto a "BUY" button. At this stage you must know that this is a limbic system at work and somehow you must try and buy something, because deep red is always followed by a bright green.

And never buy when all of the above but opposite is happening.

 

[amiuser]

The person who registered on site 10 years ago and has thousands of written posts on his behalf is not necessarily an experienced trader. Experienced writer-yes, for sure. It is just a notice....

And for the topic about when to buy stocks...there is one good sentence "buy when blood is on the streets". And I can add from myself another one: "When you catch yourself in a condition when you really under no circumstances can see that a stock can go up".
In other words-when a market movement puts a pressure on your decision making initiative and totally paralyses your finger witch you hold onto a "BUY" button. At this stage you must know that this is a limbic system at work and somehow you must try and buy something, because deep red is always followed by a bright green.

And never buy when all of the above but opposite is happening.

I disagree ...... I have seen many stocks which has come down heavily because of the fraud cases in the company.....everybody is thinking company is going bankrupt .....do you still buy such stocks with confidence when all others are leaving ?

 

[Smurf1976]

The person who registered on site 10 years ago and has thousands of written posts on his behalf is not necessarily an experienced trader. Experienced writer-yes, for sure. It is just a notice....

+1

There isn't a strong correlation between trading experience and number of posts. Eg some would have 100% of their posts relating to specific stocks and they only look at technicals. In my case, the vast majority of my posts are non-company specific and relate to broad industries, particularly oil, gas and electricity.

I make no claims of being an experienced trader as such, indeed virtually all my investments are of a long term nature and my use of T/A is very basic for the entry and exit. I'm investing based on the business itself, the chart just being a tool to help with timing the actual purchase once a buy / sell decision has been made based on other factors.

There are others who will take a very different approach and will buy stocks without even knowing the name of the company (just the stock code) or what the business is. They're looking at charts and some do make good profits with this approach so it's a valid one certainly although very different to my approach.

 

[Wysiwyg]

I am facing a trouble ...when I buy stock for positional trading based on daily chart ..after that if the market starts falling ...stocks also goes down...and I run into losses.

should I follow any timing to buy stocks ?

There is no way that any position can be taken at exactly the right time with 100% accuracy. Drawdown begins immediately with spread and trade cost. The overwhelming desire for me is to at least time the entry so as price moves in ones favour sooner rather than later and with as little drawdown as possible. I have devoted much time and money to mean reversion trading and this approach is inconsistent for me. Nice when there is a rhythmic swing happening but difficult when choppy. Interestingly, during this recent general ASX market turn down, there are stocks still trending up, completely oblivious it seems to overall market sentiment. BXB for instance put in a new yearly high four trading days ago but has come off 2.78% from that high. When I look at the chart I see that BXB has had some pull backs of up to around 7% which is probably manageable but you really want to take on the (perceived) higher probability pullback entry.

Just some thoughts. Hope they help.

 

[Wysiwyg]

What about uptrending stocks that form a consolidation pattern such as a pennant, flag or ascending triangle? Either trade the breakout or take a position inside the formation on the lower side of range.

When to buy stocks is important for me to get reasonably close to right as drawdown is hard to accept and I would rather cut and run than hold for an indefinite period of drawdown. The question of when to sell has greater importance in my opinion as there are so many options. Exiting based on a monetary profit or percentage gain or at resistance or at a MA cross/line or news/announcement or multiple P/E or company profit decline or stop loss acceptance, the raising of the Titanic or whatever. Again there will be no exact exit. One will either give back open profit, sell at loss or sell too soon.