Anirudh Sethi Report

Sun Tzu, the author of The Art of War, would make a great stock trader.  Although The Art of War is a 2500 year old military treatise it could just as easily be written for today’s stock trader as the principles outlined therein are as applicable in the stock market as in the theatre of war.  I read The Art of War again this past weekend and highlighted what I believe are some of the most pertinent and applicable principles for stock traders as seen through the eyes of Sun Tzu the would be stock trader.   Make sure you copy and post these in a prominent place for quick reference when in the heat of battle.

I. 17  When the market is rewarding your trading strategy, you should modify your position sizing accordingly.

I. 26  Now the successful trader prepares before he enters battle.  The unsuccessful trader makes but a few, if any, preparations before he enters battle.  Proper preparation leads to victory; a little preparation leads to defeat; and no preparation leads to ultimate destruction!  The one who is properly prepared is the one who is most likely to win.

II. 7   Appreciating the gains better helps you accept the losses.

II. 19  In trading, let your great object be a quick and decisive victory, not the slow death of a lengthy loss.

III. 18  If you know who the enemy is and you know yourself, you will never fear the next trade.  If you know yourself but not the enemy, you will win one lose one.  If you do not know the enemy or yourself, you will lose on each trade.

IV. 1  The good traders of old first put themselves beyond the possibility of defeat and then waited for the right time to defeat the enemy.

IV. 4  It is possible to know technical analysis without being able to properly apply it.

IV. 13  The successful trader wins his battles by making no mistakes.  Making no mistakes establishes the certainty of victory.

V. 13  The quality of entry is like a well-timed swoop of a falcon which enables it to strike and destroy its victim.

V. 15  Proper preparation may be likened to the bending of a crossbow; decision, to the releasing of the trigger.

VI.  5  Take advantage of opportunities such as support and resistance where the enemy must put up a strong defense; take swift action and catch the enemy off guard.

VI. 19  Be prepared for battle by knowing the exact time and place for proper trade entry.

VI. 32  Just as water retains no constant shape, so in trading know the market is constantly changing.

VII. 5  Trading with familiar stocks is advantageous; with unfamiliar most dangerous.

VII. 13  We are not properly prepared to trade a stock until we are familiar with the most likely direction of the general market.

VII. 21  Ponder and deliberate before you enter a trade.

VII. 28  Now the trader’s spirit is keenest in the pre-market; by noon day it is becoming weary; and by post market ready to relax.

VII. 32  To refrain from entering a market that is prepared to defend its current course is the art of practicing patience by studying current market conditions.

VIII. 3  There are trades which must not be taken; sectors that are not ready to be attacked; patterns that are set up for failure; positions that are to be surrendered; egotistical commands that are not to be obeyed.

IX.  28  In a mixed market when some stocks are seen advancing and some retreating, it is a trap.

IX.  41  He who does not think through his trade while making light of the situation is sure to fall victim to a loss.

X.  24  The trader who makes money without coveting fame and loses money without fearing disgrace, whose only thought is to protect his equity and ignore his ego, is considered to be a jewel of the kingdom.

XI. 17  When it is to the trader’s advantage, he will enter a trade; when otherwise he will not.

XI. 67  Trade in the path defined by rules and do not face the enemy until you feel you can trade with confidence.

XII.  15  Unhappy is the fate of the trader who tries to win his battles and succeed in his decisions without cultivating the spirit of confidence, for the result will be a waste of time and a drain on his trading account.

XII.  17  Do not trade unless you see there is an advantage in doing so; use not your money unless there is something to be gained.

XII.  22 The successful trader is heedful and full of caution.  This is the way to have peace of mind and to live to trade another day.

XIII.  4  What enables the wise and successful traders to trade and conquer, and achieve things beyond the reach of ordinary traders, is proper preparation.

You’re Your Own Worst Enemy

Human nature often gets in the way of sound investment decision making; even among institutional investors. Do you consider yourself to be “better than average”
drivers? Most people do. The Lake Wobegon Effect, as it’s affectionately called, was inspired by the radio series, A Prairie Home Companion by Garrison Keillor, where “all the children are above average.” Seriously though, overconfidence has the potential to make bad investments worse, by pushing obstreperous investors to hang
onto losing positions; even when evidence to the contrary is overwhelming. New car buyers love reading favorable reviews about the bright and shiny automobile they just purchased, at the same time they would be highly critical reviews that criticize their decision. As investors, we sift through a myriad of information as we assemble a mosaic. How valuable would our conclusions be if we latched onto data that only supported our views and ignored information that refuted it?

Major Hurdle at 5566

Three Consecutive close above this level+Weekly close (Must ) then expect allround unexpected buying and next target with No if and but :Kissing all time high !!

My Target 6336-6593

If able to fullfill my Condition then in next 2 months ….will see UNEXPECTED level.

(From Last 2 months writing same level and see My Sensex level too )

My Short Term Target above 5436 was of 5551-5589.Just see made high of 5543 & falling.(Just see in 6 session crashed to 5391 level )

Now ,With keeping a stop of 5566…..Those who had sold might have minted great money in Nifty Future.

Refresh Your Memory & See………What I had written Yesterday :

-My Target for the day was 5470-5479……Sell around these levels…No if and But.(Just see it kissed  5465 & crashed )

-Nobody had dared to write or speak…My words were :No Buying @ all.Sell Anything and Everything.

-No need to cover short…….on Rise ,Sell Sell Sell.What really happened u all know ???

Today ,What to expect ?

-Levels not to be changed everyday.

-Just watch 5397 level………….Once breaks this level with volumes and stays below this level for 5-10 minutes….then nonstop slide upto 5364-5352 not ruled out.

-From 5352-5360…..Expect Intraday Jump ?(Will intimate more to our Subscribers )

Hurdles :5438-5458 levels.

—–Don’t Jump & Buy any Sensex/Bank/Heay weight stocks.

——–90% Stocks or more are looking weak.Rise will be like Dead Cat Bounce.

I had written many times and told to many Traders …Before crossing 5566  it will crack to kiss 5000-4900 or more ??God Knows …Time will tell.

-Above levels are Valid till NF not crosses 5543 level-

-5566 is LAXMAN REKHA -

-Three Consecutive close below 5307….Watch Bloodbath-

-Don’t Hold or take long postion in Heavy Weight stocks ,All Trading Stocks are Manipulative only……(CC people +Operators +DATA been leaked …Combination of three things………going on )

I Will Update more Stocks /Intraday levels to our Subscribers

Updated at 7:13/31st August/Baroda/India

“How Much Can I Lose?”

Ask yourself the above question before every single trade. This is extremely important and may involve a certain shift in mindset which is of the utmost importance before entering. What I mean specifically by this is that every single trade must be analyzed first in terms of what is the maximum loss both in cents/dollars per share and total dollars before entering. Most newer traders never think this through enough, only thinking about “How much can I make?” before entering the trade. What matters much more is where the stop loss is in relation to the entry and how much of a dollar loss will it incur at the selected share size if gets hit. Enter every trade with the attitude of what could possibly go wrong. Remember that in trading even the best laid plans generally fail about 40-50% of the time. Your job is to
simply make a little more on the times that it goes according to plan while keeping the losses steady at the same amounts or less each time.

Major Hurdle at 5566

Three Consecutive close above this level+Weekly close (Must ) then expect allround unexpected buying and next target with No if and but :Kissing all time high !!

My Target 6336-6593

If able to fullfill my Condition then in next 2 months ….will see UNEXPECTED level.

Short Term Target was of 5551-5589….Above 5436 level.

Yesterday kissed 5533.

101% …No worry @ all.

What to expect from this level ???

Traders :Just watch 5528 level.Above this level……I see NF kissing 5551-5559 & then rally upto 5582-5590 level…If not Today…then next week !!

Yesterday Night (Father -DOW ) was down and now Cousins (Asian Market ) are down…so we have to follow them………….No if and BUT !!

I Think if NF not crossing Yeterday’s high :5334 & trades below 5523 with volumes…..then in PANIC………….will slide upto 5491 ,5480 level.

7DEMA :5466 LEVEL.

No panic @ lower levels……Around 7DEMA…..Buy more.

I will Update more to our Subscribers during trading hrs about NF ,Bank NF and CNX IT +Stocks trends.

Updated at 7:52/20th August/Baroda/India

Just like you shouldn’t practice your basic martial-arts forms in the ring where your mind is more focused on pain avoidance then executing the tactic correctly, a novice shouldn’t begin trading with real money and real consequences. Only once you’ve amassed significant practice in a safe environment where you can conduct your technical and fundamental analysis without being emotionally distracted should you begin to trade with real money. And when you finally start, don’t jump straight into the ring with Bruce Lee. Begin tentatively, gradually, slowly increasing your trading exposure over time as you become accustomed to the increasing levels of risk. How do you know you’ve moved too far, too fast? If you are finding it’s becoming harder to sleep at night, either because you are worrying about your trades or you are excited about your gains, then you have moved into the realm where your emotions are going to have too strong an effect. You are going to start making poor, emotionally-clouded decisions and so it is time to scale back.

Major Hurdle at 5566

Three Consecutive close above this level+Weekly close (Must ) then expect allround unexpected buying and next target with No if and but :Kissing all time high !!

On Friday written above 5434 level it will zoom to kiss 5457-5465 level.Just see it kissed  5478 & closed at 5456 level.

Now ,What to Expect ?

5464 is Hurdle.Crossover above this level will take to 5489-5495

Support exist at 5443.Decisive break below this level …Nonstop slide upto 5421-5414 not ruled out.

Below 5414….More Panic !!

(I will Update more about NF ,Bank NF ,CNX IT and Stocks to our Subscribers during trading hrs )

Updated at 7:12/16th August/Baroda

Take your eyes off the prize. Hunter explains that the “score would happen if we focused on the process.” Too many traders are only focused on the daily profit and loss statement instead of focusing on improving the methods that produce those profits and losses. Consistent, steady improvement can only be gained after a trader commits to a full understanding of the process of trading well.

Recognize a real gamble. When you are trading well, take the possibility of a major loss out of the equation whenever you can. It is true, when we are the most vulnerable is when everything is going right and it seems like we can do no wrong. Moreover, there are times to make the big aggressive trade, and times when doing so is foolhardy. Recognizing the difference is so very important.

Major Hurdle at 5566

Thinking in Themes – Traders look at different themes across different time frames, but the good ones synthesize market information and arrive at a view of how their markets are likely to trade. Instead of impulsively buying or selling when a market makes a new high or low or when a chart assumes a particular configuration, they see a broader chessboard: how other markets are trading, how the smaller timeframe fits into larger ones, etc. This ability to synthesize data and arrive at themes is a large part of what helps traders make sense of markets and develop the confidence to take meaningful risk in search of superior rewards.

Major Hurdle at 5566

Three Consecutive close above this level+Weekly close (Must ) then expect allround unexpected buying and next target with No if and but :Kissing all time high !!

Yesterday ,I had written below 5451 level it will crash to kiss 5427-5422 & there after expect slide upto 5398-5392 level……In Panic it crashed upto 5404 level.

-From Last 3-4 sessions writing…Dont jump and buy Sensex -Nifty Stocks…Dont hold long in Heavy weight stocks.

What to expect now ?

Today ,Just watch 5392 level.

Decisive break below this level with volumes will take to 5369-5362 level.

-Crucial support :-5341.

Once breaks 5341 and closes below this level then NF will plunge nonstop upto 5291-5275 level in PANIC !!

Now 3& 7DEMA will act as Hurdle !

-5437—–5441 levels.

I Will Update more about NF ,Bank NF ,CNX IT and Stocks during trading hrs to our Subscribers

-Complete Correction from 4786 to 5489 started ????

-Then Watch Panic selling upto 5313-5269 in this fall !!

Iam writing  from last 2 months ,5566 is LAXMAN Rekha for NF.Before crossing this level………will see Big slide -Big panic.

Updated at 6:48/12th August/Baroda/India

Win the war, not every battle. Put on individual trades which have sensible risk/reward, but place emphasis on your overall operations rather than each individual effort.  Basically, see the forest and not just the trees!  Accept that there will be some some losing trades, perhaps frequently, depending on your timeframe, and aim to overcome them with larger or more frequent winners.  The point of taking this step is not to go to battle with every trade due to the mindset of having to be correct.  Accept it when you are wrong, and no single ‘battle’ will ever sink your ship.

Major Hurdle at 5566

Three Consecutive close above this level+Weekly close (Must ) then expect allround unexpected buying and next target with No if and but :Kissing all time high !!

Short Term Hurdle -Crossed !

It should close above 5436 level for 3 days for target of 5551—-5589 level.

(Not to be written everyday ,but traders and readers having short memory )

As expected it had closed above 5436 level for three days…..So above 5436 level….Now above mentioned targets will see very soon -Just have patience -

Yesterday ,I had written Support was at 5427-5420 level.It kissed 5437 level.Hurdles were at 5460-5477-5484…….Just see it kissed 5489 & closed at 5482.

Today ,What to expect ?

Today will face Hurdle at 5491——–5500 level.

Keep A Stoploss of 5540 ,Go short …….101% !!

Support exist at 5464 ,5448 levels. ( 3& 7DEMA )

-Every day low volume

-Bhismpitma as expected in freefall.

-BANK STOCKS -BANK NF :Moving Up ,Target 10800-10900 intact !!It will be a TRAP of life !!………..Just wait time will tell !!

MIDCAP Future Stocks :Moving up…..reason Driven by Operators /Insiders !!Before result and after result……..Management playing dirty game !!

I Will update more to our Subscribers during trading hrs.

Updated at 7:42/10th August/Baroda

It’s been said too many times to count – that you must trade according to your personality. In the movies they might call it “being true to yourself” or something cheesy, but it’s a necessity in this job.

Recently I was asked which chart patterns I prefer to trade, continuation chart patterns or reversal chart patterns. My answer was that while I will actually trade either, I suppose the continuation and breakout type of patterns are the ones I trade more often than reversals or buying on support levels.

I don’t think one setup is superior to the other, they both have their pros and cons, and you have to go with what fits your style best.

Buying on support is an anticipatory play, which may take a few extra days to get moving. It can give you a lower cost basis than another trading strategy, but will require greater patience on your part while you wait for the stock to find traction.

Buying a stock which is breaking out puts you (by definition) in a stock that’s already on the move. This is a confirmation play. You get instant feedback on how your trade is developing and how much momentum the stock has.

The setups you select for your trades need to incorporate your personality tendencies on managing those trades once you are in them. For me, I tend to be a bit impatient and I want to know as soon as possible whether or not I’m right or wrong on a trade. Other traders don’t live in the left lane, and they’re willing to give a stock some time to get moving one way or another. They place their protective stop and turn their attention to something else in the meantime while waiting for their trade to make a move. Personally, I prefer to have my money at risk for the shortest timeframe possible. I really prefer the times when the market conditions are producing breakout plays and continuation patterns like the bull flag or ascending triangle patterns.

So, when you’re doing your homework and looking for quality setups to trade, be sure to consider the ones which fit your personality and your style of trading. Those will be the trades which you ultimately will manage the best.

One way we could define trading is to say that it is a long term battle for control of active reasoning over the primal emotions of fear and greed. Success at this must eventually make one a better person, and this would feed into all areas of your life. Why? You would become more rational and less reactionary.

At the same time, there is a clue here that we have to take our trading discipline out into our lives. You cannot act like a passionate lunatic filled with rage, lust and paranoia in your day to day life and then expect to turn into a calm rational super-being when you sit down in front of your trading station. Lunatic in life, lunatic in the market.

On the flip side, I can see that losing this battle in the market would also weaken you in other areas. It would erode your confidence, and these emotions once indulged would strengthen their grip over you.

Major Hurdle at 5566

Three Consecutive close above this level+Weekly close (Must ) then expect allround unexpected buying and next target with No if and but :Kissing all time high !!

Short Term Hurdle -Crossed !

It should close above 5436 level for 3 days for target of 5551—-5589 level.

(Not to be written everyday ,but traders and readers having short memory )

As expected it had closed above 5436 level for three days…..So above 5436 level….Now above mentioned targets will see very soon -Just have patience -

Fools ,Jokers & Idiots can see Yesterday I had written NF will show power above 5484 level…it kissed 5483 & cracked !!

Today ,Just have a eye on 5448 level.Break with volumes will take to 5427-5420.

-Below 5420 ……Slide will continue upto 5399-5392.

-Hurdle at 5484

If crosses then only will show strength !!

I will update more about NF ,Bank NF ,CNX IT & Stocks to our Subscribers during trading hrs.

Updated at 8:03/06th August/Baroda