A Moving Average Trading System

[kam pil]

Hello All....
I am new in traderji.com, 3X13=39 is the good method to understand & implement.

kam pil

 

[trader31339]

Kindly Attention:Mareeche

Sir must have been said abt stop loss.Initial stops are not a problem.But how should one decide moving trailing stop loss in 3-13-39 MA system any idea? Though the entry is late no problem but then the exit is so late that you miss a big part of the cake!!!

Please help me out !!!

 

[asnavale]

Yes, I agree that a single indicator is not sufficient and that the MA crossover system is essentially a single indicator technique. It should take into consideration the general trend, not the short term trend. Of course, there are several ways to infer the trend. We must follow the trend and also strictly stop loss.

My idea is not to say that the 3-13-39 or whatever is ideal. As I have said in my post, it is only the first part. I will be posting the next part shortly. I am trying to point out two things:

1) There are some failures of the method which we should identify and try to refine to improve the success rate. I have pointed out this in my post taking the example of TATA STEEL. I also explained why there was a failure. That is why I have said I would be posting a variation of the MA cross over method where I have found more success than the 3-13-39 method.

2) As we are using lagging indicators we should refine our strategy to bring down the lag interval. It is no use to find very accratley the point at which the change took place if that inference is drawn after ten days. Again I draw your attention to watch my next post where I have tried to bring down the lag.

But once again I am telling that even the method I am going to explain is not fool proof. It is only an improvement for better success rate. I am working on the same now and shortly post it.

-Anant

 

[Mareeche]

Kindly Attention:Mareeche

Sir must have been said abt stop loss.Initial stops are not a problem.But how should one decide moving trailing stop loss in 3-13-39 MA system any idea? Though the entry is late no problem but then the exit is so late that you miss a big part of the cake!!!

Please help me out !!!

Traditional Pivot Support and Resistance method would be a good starting point to fix stoplosses on your trades. Other than that you could also use break of an important moving average to act as a stop. Whipsaws can happen here as well in volatile scrips. Another method is to use the Average true range..(ATR) or break of trend lines etc., Here too there is no holy grail for stops.

Timing and entry into a trade with a reasonable risk reward is the important aspect, and this R/R must be ideally say 1:2 or 1:3. ( For eg No point in getting into a trade where the gain is expected to be say 10rs and a stoploss of say 6 or 7 rs.)

Request comments from senior members on any other points I might have missed out.

 

[trader31339]

Thanks,Mareeche.

Regrading risk reward ratio, I have a query and will be thankful to you if you take effort to answer it.

Its easy to calculate risk reward ratio.But the main this is how to calculate the reward first????

 

[Mareeche]

Hi
Since you are intrerested in TA, it would be of great help to read some books. John Murphy's book is highly recommended though there are quite a few others as well.

 

[akashbothra]

This is the last part of the 3,13,39 rule which i found in a website called http://www.tradertalk.com/tutorial/3x13x39.html

When the 3:13 crossovers occur at some distance from the 39 MA then you are 'likely' dealing with a short term correction (even though it can be substantial) to the 39 MA..

If the 3:13 & 39 MAs are close and converging before crossing over you are 'likely' dealing with an intermediate (or significant) correction of the trend or reversal.

'Likely' means probable not 'you can bet the farm on it' surety. There is no sure thing just as there is absolutely no free lunch.

 

[vince]

This is the last part of the 3,13,39 rule which i found in a website called http://www.tradertalk.com/tutorial/3x13x39.html

When the 3:13 crossovers occur at some distance from the 39 MA then you are 'likely' dealing with a short term correction (even though it can be substantial) to the 39 MA..

If the 3:13 & 39 MAs are close and converging before crossing over you are 'likely' dealing with an intermediate (or significant) correction of the trend or reversal.

'Likely' means probable not 'you can bet the farm on it' surety. There is no sure thing just as there is absolutely no free lunch.

Is'nt that a fact Akash , just like there is no holy grail but no one is going to believe you until they go thru the grind and discover for themselves.

 

[trader31339]

Attention Senior Members,
There are many stocks in Futures Segement.

It is headache and time consuming to analyse each and every Futures chart and scan trades and trade set-ups.

Thus I trade mainly Nifty Futures.But then coz of this I miss oppurtunities in stock futures.I want to trade Nifty future at the same time dont want to miss oppurtunities in stock futures.

So,I need a mechanical scan system through which I can scan the list of stock futures and shortlist them.After short listing them I can then manually look the charts for further study.

Now the quetion is how to scan and shortlist them?What should be the parameters on whcih I should scan?Yes, I have metastock and explortaions but which exploration will give better results dont have an idea.

Thus,I request senior members to help me and tell the parameters on the basis of whcih I should scan the stocks futures, so that I shortlist the stockfutures list after which I can manually analyse.

Thanks,

 

[alokdaga]

Attention Senior Members,
There are many stocks in Futures Segement.

It is headache and time consuming to analyse each and every Futures chart and scan trades and trade set-ups.

Thus I trade mainly Nifty Futures.But then coz of this I miss oppurtunities in stock futures.I want to trade Nifty future at the same time dont want to miss oppurtunities in stock futures.

So,I need a mechanical scan system through which I can scan the list of stock futures and shortlist them.After short listing them I can then manually look the charts for further study.

Now the quetion is how to scan and shortlist them?What should be the parameters on whcih I should scan?Yes, I have metastock and explortaions but which exploration will give better results dont have an idea.

Thus,I request senior members to help me and tell the parameters on the basis of whcih I should scan the stocks futures, so that I shortlist the stockfutures list after which I can manually analyse.

Thanks,

If Nifty is giving you money - forget about others !!

Put your money in Nifty only !