Monday, April 25, 2011

Probability of Uptrend and downtrend, selling and buying decision

During an uptrend, the probability of going up is higher than down turn. That is the reason why there are usually 2-3 days of uptrend and 1 day of downtrend. The probability of going up is high. That is the reason also why one should alway hold the stock during an uptrend. Do not sell even after getting 20-25 percent profit.

The same holds for shorting stocks during a downtrend. The days of going down are more than going up. So keep holding till an equilibrium comes.

These are basics and reason why one should hold when the stock is following the rules of uptrend or downtrend. 

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