Reason I exited Asian Paints yesterday even though SL was a long way off was that on closer inspection I found that the chart was overbought in the short term and probably needed to correct or consolidate before a significant and sustainable move began. Both are imp. if we want to have a favourable risk-reward ratio. As it happened, we got out at the right time as the stock fell intraday. Of course, it could have gone up as well but based on my reading I wasnt comfortable with the set-up. So no shame in admitting you made a error in judgement and look for better opportunities rather than be stubborn and egoistic and hold on to the position. When the very basis of the trade is in question we should exit. Eventually, our aim is to make money, not prove a point
On Voltas - I was looking for another short to enter for the last couple of days but most stocks had fallen so much that chances of a bounceback were extremely high in most of them. And then I found a gem in Voltas. Its great when a stock gives you a good 5-6% move on the same day and proves your decision correct (for the time being). It doesnt happen every day so its good to enjoy such small moments. Confidence, after all, is vital in trading. Without that you will see good entries but not take them due to fear of a loss. Amazing what psychology can do to even the best of traders. Emotion, confidence (over and low), greed, fear, ego - these are our biggest enemies in trading, not the market.
On Voltas - I was looking for another short to enter for the last couple of days but most stocks had fallen so much that chances of a bounceback were extremely high in most of them. And then I found a gem in Voltas. Its great when a stock gives you a good 5-6% move on the same day and proves your decision correct (for the time being). It doesnt happen every day so its good to enjoy such small moments. Confidence, after all, is vital in trading. Without that you will see good entries but not take them due to fear of a loss. Amazing what psychology can do to even the best of traders. Emotion, confidence (over and low), greed, fear, ego - these are our biggest enemies in trading, not the market.