Meet the stock trader who predicted the exact Corona crash market bottom
When the corona pandemic hit the world in 2020, the stock market was no exception. Nifty witnessed one of the fastest drops in history, where she plummeted nearly 40% in 40 days. From the February high of 12,246, it fell to a low of 7,511 on March 24, 2020. Market sentiment had turned overwhelmingly negative and investors were in shock. Much wealth has been destroyed.
However, one investor had the courage to build his long-term portfolio as the market fell. Afzal Lokhandwala is primarily a full-time trader and a passive investor. He even shared his list of stocks he was buying on his Telegram channel, which included Indiamart Intermesh, Bajaj Finance, Info Edge and a few others. He said: “A line from Warren Buffet kept going through my head. He said, ‘Buy fear and sell greed’. I saw corona fear in the market. I just put market sentiment aside and built my long term portfolio of quality stocks during the stock market crash.”
Afzal has a deeper understanding of market psychology, and he identified the exact market bottom on March 23rd when he tweeted the following via his handle (@afzal_57):
“Markets will crash until everyone is scared and no one dares to invest more. Once it’s done, a rally will come, so strong and we’ll be like “Oh miss” #psychology #marketcrash“
Afzal is a Chartered Non-Practitioner Accountant. It draws a clear line between trading and investing. During the stock market crash, he was bearish as a trader and bullish as an investor. He says, “I mainly trade short term. However, when I have such unique opportunities, I invest long term during that period. Most people start trading and when their stocks suffer losses, they become investors in those stocks. That’s the problem. I’m always very clear about all aspects when I put my money into any stock.”
Short-term traders use technical analysis extensively to make decisions in the market. Afzal studies short-term price behavior through reading prices and volumes. It focuses entirely on charts to trade profitably. He says, “When I’m buying something for just a few days, the company’s balance sheet is irrelevant. I’m analyzing the trend of the stock as well as the supply and demand patterns, and all that can be done using only the graph.”
In 2021, when fear was high amid the second corona wave, Nifty entered a minor correction from the February high of 15,431 for around 40 days, where it fell 8.3%. Afzal again took to Twitter on April 21-22, 2021 and tweeted the following:
Surprisingly, Nifty hit another low at 14,151 on April 22 and rallied strongly. Afzal has gained huge following on Twitter and trained many aspiring traders in the stock market. He believes in learning the right approach to technical analysis, implementing a risk management system and always having a stable mind to be a successful trader.