BollingerBands

[Raghavacc]

In the morning I was away from home so a bit delay in replying.
(I think you modified the post.)

At the outset ,I mention that Average lines are lagging indicators.
I am referring to NS (Nifty Short) graph which is slightly different from NF
(nifty future) chart.

Yes 12.20 is a weak signal as most of the average lines are UNBROKEN.
Previously I used have (s,20) as my trendline,there is nothing wrong
in having more,Exponential Average lines of lower order.

But signal at 14.20 at 4935 created problems.(Topband+Green+Red
indicating SHORT) and able to close by 1520 at 4925.

Indeed I dint see this line posted by you just under the chart. So happened ask that question.Then once I saw ,got your idea hence modified my post.

"Blue line is (S,20) line ,above it Buy/Buy-Hold (white colour),and below it Sell/SELL Hold (Maroon colour)."

Even for me that 2-3.30 period was a very stressful one as the structure of the chart was not clear. Hence stayed away from any trades.

Regards
Raghav

Regards
Raghav

 

[columbus]

BB(20,2) of nifty futures on time frame 4/6 min are presented below.

Case1.Choppy Market:
Go long when Red+Green candles pierce the bottom band (Keep case.2 in mind also always)
and wait for 15minutes for confirmation after taking position, otherwise come out with stoploss.
Go short when Green+Red candles pierce the top band (Keep case.2 in mind also always)
and wait for 15minutes for confirmation after taking position , otherwise come out with stoploss.

In case of Verital rise or Vertical fall ,the above rules may not work & have close
look at the central line and outer boundaries always.Perhaps this may qualify for case.2.
A close of candle outside the bands need not necessarily mean termination of trend but it be continuation as well.
Have patience to keep a watch on those situations.

Case2.Trending Market:

If the candles are concentrated in Top band ONLY go Long.
If the candles are concentrated in Bottom band ONLY go Short.
Rules of Case.1 do not work here and keep Mid line as stoploss.
The Proximity of candles with respect to Outer boundaries indicates the Strength.
More strength means more closer to Outer boundaries.

Avoid trading when the Bollinger Band is Narrow and Horizontal.Check with Nifty-Spot chart occasionally.

Today SHAREKHAN released new version of Tradetiger (1.0.4.5)
with minor changes.

 

[scplindia]

Dear Columbus,

The BB system is good for entry, but when do we book the profit and exit the trade.

Thanks
Prem Kumar

 

[columbus]

Dear Columbus,

The BB system is good for entry, but when do we book the profit and exit the trade.

Thanks
Prem Kumar

Dear Prem,

Any system is good ,provided you have good control over GREED & FEAR.

 

[veluri1967]

Dear Prem,

Any system is good ,provided you have good control over GREED & FEAR.

Columbus,

Its a marvelous statement.:clap:

To make it simple, the success or failure of system depends how far you look into yourself. Am I right?

 

[scplindia]

Agreed, with you these are two very difficult emotions & needs control.

I want to know when to exit the trade, after entering using the BB system.

Thanks
Prem Kumar

 

[veluri1967]

Agreed, with you these are two very difficult emotions & needs control.

I want to know when to exit the trade, after entering using the BB system.

Thanks
Prem Kumar

Let me snatch this opportunity from Columbus to explain the context.

You have a stop loss in your mind before entering the trade. Do you or not?

Have your paper traded the strategy to assess the R hits? If you are new to R, just google and download "Trade your way to financial freedom" by Van tharp.

That is for later. If your entry price to stop loss equals R, your profit target should be atleast 2R.

However, columbus devised another strategy to hit your target.

I personally donot advocate any profit target or stop loss. It is upto the person to assess his comfort levels to book losses or profit target.

Bro... donot expect spoon feeding. But immerse yourself in this ocean to survive. I wish you all the best.

 

[scplindia]

My SL is 1 percent of the entry price and work on booking profit based on comfort, but would love to have a strategy to book the profit. Because sometimes the prices reverse very fast from profit and hits SL or most often, I book out profit much earlier loose out from some good profits. Had there been some strategy, may be I will be able to maximise the profit.

Thanks

 

[veluri1967]

My SL is 1 percent of the entry price and work on booking profit based on comfort, but would love to have a strategy to book the profit. Because sometimes the prices reverse very fast from profit and hits SL or most often, I book out profit much earlier loose out from some good profits. Had there been some strategy, may be I will be able to maximise the profit.

Thanks

Now, you are at the right point, brother.

Masters who have better skills and experience than us, must be foreseeing our targets and SLs. They trade to shake out weak hands like us by placing very big orders to reverse the direction at least temporarily. Thatz the reason why your Profit Tgt is reversed too fast.

A simple game of Masters is to trade against herd especially when there is no much activity in the market. Its a tug of war. Who ever pulls the rope wins the game. When Masters are trying to trap us, do you think they give us leisure of closing the trade?

This is not to discourage you but to enlighten. All the best.

 

[scplindia]

so, I understand, the exit strategy is SL and book profit based on personal judgement & comfort.