Why this Software Program is Useful:
The trouble with the market is that there there are times when it goes down and investors lose, and longer periods when it goes
up and investors can gain. It tends to trick people's logic and send them into panic mode. They get discouraged and exit. The
trick at these times when it is low is to hold and even buy when everyone is selling. When the market is at the bottom, and
the media is telling a discouraging story, when things don't seem like they could get any worse, and you may be feeling some
fear, this will be the time when the market will switch and the bulls come out to play. Things will turn around and turn around
quick, this won't be the time to sell but to buy!
The frailty of human nature is fear. We tend to second guess our decisions even after being well prepared and having thoroughly studied out our plans. Cynicism shows it's doubting head and we begin to hear voices, the what if game commences to be played out in our head. Robert Kiyosaki likens this phenomenon to the story of Chicken Little who ran around the barnyard declaring doom, and because of fear ended up in a sorry state49. Most people are chicken littles who run around yelling "the sky is falling! the sky is falling!" Successful investors have to be brave, they recognise bargains and opportunities when they come along. When everyone else is running around scared like little chickens, they hold tight and wait out the storm.
Sometimes unseasoned investors impulsively make decisions that aren't well thought out. They are too quick to proceed in a deal without carefully considering the outcomes. Perhaps they are not being honest to themselves about the true situation. Lapses in judgment aren't just reserved for the novices. It can happen to seasoned traders with decades of experience as well. Investors need wise support to aid them in the timing of their trades, in decision making. Successful interpretation of charts and fundamentals doesn't come overnight. The market and individual stocks can move in numerous, confusing, and ever changing ways. The effects of world politics and general conditions have complex influence on markets and how they behave.
"The speculator's chief enemies are always boring from within. It is inseparable from human nature to hope and fear... And when the market goes your way you become fearful that the next day will take away your profit, and you go out--too soon. Fear keeps you from making as much money as you ought to. The successful trader has to fight these two deep seated instincts. He has to reverse what you might call his natural impulses. Instead of hoping he must fear; instead of fearing he must hope... It is absolutely wrong to gamble in the stocks the way the average man does."50
Traders know how difficult plunging in and out of the market can be. It's great when we are winning and terrible when we are losing. The feelings of fear, doubt, and hope are at constant battle. "...not only is it difficult to predict markets, but ...small investors tend to be pessimistic and optimistic at precisely the wrong times..."51 What is needed is a program that provides assistance to the well informed investor. This is the purpose of this program, to provide that objective assistance, to help the trader recognise patterns, and interpret the market. It's not meant to be a fix all, a crutch to be used instead of study, and not solely to be relied upon with no other further use of technical indicators. It's meant to scaffold the informed trader who is already knowledgeable in markets and their charts.
The Software:
The ouputted advice that the software generates isn't meant to replace human judgement but to dispel doubt and be a support. Anyone
who relies exclusively on a technical indicator at the expense of careful common sense judgement is venturing into a risky situation.
The software uses generally accepted criteria from institutional investors in calculating output and thereby instills confidence and
faith in investors and students.