Read the oldest stock market wisdom from the world renowned physicist.
This revelation had me surprised too. I was idly flipping through my old physics textbooks yesterday when it suddenly struck me. I was amazed to realize that Sir Issac Newtons laws of physics points to so many profound and important rules in the stock markets today.
So, here we are the physics of the stock markets.
Newton’s First Law of Trading
A Stock at rest tends to stay at rest and a Trending Stock tends to stay in trend unless acted upon by an equal and opposite reaction or an unbalanced force.
This law teaches us the same thing the old commodity traders will that the trend is your friend. If a stock is trending sideways, it tends to stay sideways until a powerful enough market force takes it out of its trend. If a stock is trending up or downwards, it will tend to stay moving up or downwards until drastic changes happen to the company or the market at large creating an equal and opposite reaction. We should therefore always trade in the direction of a trend and always be vigilant for signs of an equal and opposite reaction or the unbalanced force. Such a force...