Market effect on share price movements

[grah33]

i've been reading a great book from the library (louse bedford, charting secrets) and just want some clarification on what this means:

"

If the overall market is bearish, it is probably a good idea to wait for the pullback change of polarity to occur before opening a position. this will lead to heightened confirmation that the uptrend will endure. if the overall market is fairly buoyant, consider jumping into a long position at the first sign of a breakout. breakouts ...more likely to hold when...market is whispering 'buy, buy, buy'

"

i get what it's saying but how can i tell that the market is bearish? how can i tell that the market is buoyant? what feature or trendline or what...

 

[grah33]

ok, i get it, but still learning . if we can time the market so that when we trade the market has increased in value from start of trade to the end of trade, that is what we want. any practical tips for doing this? i'm thinking of drawing trendlines on the market index and making sure i'm entering in an uptrend for my time period, and also entering during an upwave and not a pullback move. would love to know what practical things others do when assessing if the overall market is suitable for a new long entry.


(i made another thread for this, but not meaning to exclude previous posters)

 

[Wysiwyg]

Not all stocks are correlated to the Index. The Index predominantly reflects the large capitalisation stocks. One can still run a loss during a bull market by poor stock selection.

 

[grah33]

Not all stocks are correlated to the Index. The Index predominantly reflects the large capitalisation stocks. One can still run a loss during a bull market by poor stock selection.

thanks, i know. but a few authors are saying to make sure the market is trending in the same direction with the trade. just wondering what are people doing on a practical level when they check for this.