Most of the answers related to your query have been very aptly answered by @ChaitanyaC in his post.
We are currently in the phase where a lot of breakouts are failing and though stocks are not collapsing, the expected outcomes of pattern breakouts are not coming through. This can be looked at as a sort of warning where its time to look at the structure of overall markets and see who things are panning out.
If overall markets remain lacklustre, very few bullish patterns will play out. Stocks will go sideways, or correct and not make the expected quick comebacks.
In this kind of markets its better to wait on sidelines for market momentum to return, or be very choosy in the stock selection process. Hoping for a stock to bounce back after a pattern has failed is hope investing. Techno funda investors often fall prey to this problem because in the absence of technicals playing out, they tend to fall back on fundamentals, taking solace in the fact that fundamentals are good and stock will not fall further. But there are no fixed rules for these situations.
And following strict stop losses will spare a lot of pain. Its betterr to exit a stock at say a 7% loss than see a drawdown of nearly 15-20% which can effortlessly come about in an overall weak market.
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