Firstly, we have to decide whether a particular order that we are placing is a trade or an investment.
Trades are made for quick bucks (over a short time period). It is just about flipping the stock. For these
people timing their entries and exits is crucial. This is nothing more than a coin toss (or slightly better than it, if you are exceptional at Pattern Detections).
For an investor, it’s about the long run. Really long run. As an investor, you don’t care about the movement of last few days or weeks. You care about the fundamentals of the company. You do analysis. You read last 4-5 years of AR. Read about management integrity. Minority Shareholder protection. Competition. Cashflows. liabilities & assets of the company. Promoter profiling. Read and analyse and think about the future of the company. Then you come up with what you seem is a fair value. Then you keep some buffer to that and start buying the stocks. It’s that simple (or maybe not! ).
For a good investor, it’s less about being at the right time in the market and more about mental and psychologically being in the right place. Markets have to do something everyday. So the stock price will go up/down for no reason. This is just noise.
As an investor, we will always be unhappy. Either we have missed an opportunity, or we have put very small amount on a good stock or we have put a lot of money on a bad stock. We all have to deal with it. It’s a fight everyday, to trust yourself, to accept mistakes when we are wrong, learn from it and again trust yourself.