Day Trading Futures

[umesh12]

Very simple, no money to trade; all options being overpriced at this time of the series

And they will remain overpriced till budget, atleast.

 

[manishchan]

A very nice post from Sukhani's blog

Mixed Feelings
This is what happens with most of the traders at some point of time in trading - "Mixed feelings". They confuse themselves in taking decisions, wondering if they should wait or be long or short in market. And the reason behind it is they think too much and listen to others rather than themselves and do not follow a game plan.

For example, if we talk about Nifty, it is in a choppy period right now. Now many traders may predict the up move is ending after a 1500 point rally(from 6000-7500) and a downtrend will start. While some traders may suggest that it is just a consolidation and market will pick up its momentum soon and make new highs again.

My point is: why do we need to predict the future move, which always confuses us and most of time leads to a wrong decision. Instead, we should analyse the current market movement and enter the market according to our setups applied to the market.. If I talk about Nifty, than it is in choppy period(going higher and lower with big moves and closing near to last close) and choppy markets are sign of a trading range. The eventual breakout from the range with give a trend, either up or down. I would rather wait for the range to resolve itself in any one direction.

Traders are likely to get mixed feelings if they attempt to predict the future. Trading is about taking decisions according to our own rules. Our task is to develop rules that have a positive edge and then to follow them.

 

[maijtsthoslaa]

Hi Manish

I am a big fan of Mr. Sukhani, the great analyst. But here, I do not agree with him.

Just the read third paragraph.
He is saying we do not need to predict the market for future move, instead we should analyse the current market move.

My saying will be, to analyse the current move for what, for future movement. And to say about future movement is prediction. Or one predicts about future by waving hands in the air.

You see the chart, analyse it (using whatever) and predict for future move.

Cheers

 

[maijtsthoslaa]

NF ullu banawing for the last 2-3 days.. better to be watchful and learn how TP trades to be in such a nice position...

Ha ha
Here NF is ullu banawing to we traders for the last many days.
But do we really know who is ullu banawing to whom in our daily lives.

 

[jmth]

for all the senior traders...i am new to trading..
i have done some paper trading using basic indicators like MACD and regression crossover.
I want to start trading in nifty but it feels a big step up and i fell i do not have sufficient knowledge about developing a trading strategy..i want to learn about trading strategies/indicators and analysis which is effective in the current market ..
there are so many strategies and learning information on the forum from so many traders...but they are all very old ...
this query might be silly...but are all those strategies/resources still effective in the present market....because i am confused as no one seems to be using them anymore....also there are many resources and i do get confused...
any guidance in this respect from senior members will be very helpful ...i will be very grateful..

 

[manishchan]

for all the senior traders...i am new to trading..
i have done some paper trading using basic indicators like MACD and regression crossover.
I want to start trading in nifty but it feels a big step up and i fell i do not have sufficient knowledge about developing a trading strategy..i want to learn about trading strategies/indicators and analysis which is effective in the current market ..
there are so many strategies and learning information on the forum from so many traders...but they are all very old ...
this query might be silly...but are all those strategies/resources still effective in the present market....because i am confused as no one seems to be using them anymore....also there are many resources and i do get confused...
any guidance in this respect from senior members will be very helpful ...i will be very grateful..

I can understand the state of mind you are in. Itz common to get overwhelmed to see so many strategies. The best thing to do is to just choose one at a time, test it, backtest it.. see if this works for you. If it does..stick to it. No strategy is a holy grail.. the only holy grail in trading is Risk control nd Money management. Learn price action, candlesticks and then choose your strategy. All strategy old or new works in the market.. but what works for me may not work for others..dtz why choose one..backtest it urself..see if you understand it..can handle its drawdown etc etc..Backtesting will give u confidence, paper trading some practice. Then start slow.. may be just 1 lot. Stick to ur plan.. cutt ur losses quick, let d profit run...dont overtrade and with time u will see urself progressing to be a profitable trader.

 

[jmth]

Thanks
So for now these are the important points :
1. Knowing about price action and candlesticks.
2. Pick a strategy and backtest it...and stick to it( i am facing problem here as i cannot find recent intraday data for futures for charting)
3. Money Management and Risk Control(i understand that this is the most important )
4. i wanted to try pride's strategy outlined here...
http://www.traderji.com/day-trading/29798-prides-intra-day-strategy-profit-everyday.html
but again i cannot backtest it because of lack of data..
what are your thoughts on this strategy...the owner of the thread said it was old and he doesn't use it anymore...

Thanks a lot for your help...

 

[manishchan]

Hi Manish

I am a big fan of Mr. Sukhani, the great analyst. But here, I do not agree with him.

Just the read third paragraph.
He is saying we do not need to predict the market for future move, instead we should analyse the current market move.

My saying will be, to analyse the current move for what, for future movement. And to say about future movement is prediction. Or one predicts about future by waving hands in the air.

You see the chart, analyse it (using whatever) and predict for future move.

Cheers

Prediction and Analyse may be understood as similar thing but there is a subtle diff. I understood the point you trying to make and I don't disagree to it.

Consider this example of cricket.. we often hear people say.. Indian team is in great form. All the batsment and bowlers are at its best. This Australian tour will be definitely won by India because they havn't lost any series in last 1 year and doing great etc etc. (this is prediction)

Now India may win with Australia or may not. But as a cricket fan I will enjoy watching it. As players both the teams will keep trying till the last ball is left in the game.

Lets take 2 scenarios :

Prediction : Currently NIFTY is at 7508.. I know budget is around the corner and it will be good news so I initiate long because I know market will move up re-touch all time high and even can break it. I will hold this position till budget. Now for some reason NIFTY starts drifting down.. goes to 7575.. i'm still holding coz i know it will re-cover budget has good news. Next 2 days.. it goes down to 7430.. I'm still holding. Then budget is announced NIFTY zooms up to 7700. Oh.. sigh of relief great profit.


Analysis (going with the market flow) : Same scenario.. 7508 currently I don't care about budget but I know I need to keep this in the back of my head. My primary source of analysis is chart. Let's say chart says.. uptrend has started. I will initiate long but my SL is 30 points. Market goes down to 7575. My SL hit. I will re-analyse and take the SL. Market goes down to 7430 and start re-turning. I see all the signs of uptrend again at 7550. I re-enter long and trail it till 7700. Once reached and I get out.

Now.. both the approaches are making money but which one is healthier and a good approach for a trader to survive. Analysis doesn't predict the market.. it just says that market is in uptrend or downtrend. It says if it is uptrend where is likely to be the resistances or support. It says is it a strong move based on chart or weak move. and based on all these things we align ourselves into long or short or stay out of market mode. Whereas in prediction.. one gets stuck with a view because his mind says that now market has gone up so will come down and vice versa. And in this hope people can hold onto losses...pray..and be stressed etc etc.

That is exactly what Sukhani is trying to say .. instead of predicting and blocking our minds with a bias.. it's always good to the flow... if we are rightly aligned, we make money.. if we are wrong we get our SL hit. We can't dictate market and says market will go up or down.

 

[manishchan]

Thanks
So for now these are the important points :
1. Knowing about price action and candlesticks.
2. Pick a strategy and backtest it...and stick to it( i am facing problem here as i cannot find recent intraday data for futures for charting)
3. Money Management and Risk Control(i understand that this is the most important )
4. i wanted to try pride's strategy outlined here...
http://www.traderji.com/day-trading/29798-prides-intra-day-strategy-profit-everyday.html
but again i cannot backtest it because of lack of data..
what are your thoughts on this strategy...the owner of the thread said it was old and he doesn't use it anymore...

Thanks a lot for your help...

Buddy... I don't know how much you know already. But remember one thing.. all the strategies work in trending market. No matter how old Pride's strategy is if market is trending it will work. Someone using and not using is discretionary. But irony is that most of the time markets are not trending. That is exactly where a trader with limited tools gets beaten. You need to learn to recognize trending vs non-trending. How to identify. Then formulate your strategies around it. What will you do if market is trending.. which strategy you will use.. where is entry, exit, sl,, target etc. In sideways will you trade or will you stay out or look for script which is moving and trade in that. etc etc.

Like I mentioned above.. all the strategies work but we have to knwo when to use them and how to use them. Most importantly when not to use them and how to avoid them. So instead of just following strategy blindly, understand the logic behind it.. understand why it works. You will be surprised that once you get the logic you might tweak it according to your suitability. For example.. the Pride's strategy that you posted above is a moving average crossover that you can enter based on the trend. Now logically I will try to understand how the crossover works if not 5, 13.. some other cossovers.. if not STOCH may be some other indicators. Bottom line is that crossovers and indicators if used rightly they do work. How it can work for you is entirely up to you to find out. How ?? first understand the logic and then backtest it with diff scenario, data, etc.

For the starter you must already know Price Actions and Candlesticks (basics). Price Actions according to me is like Alphabet you can't run without it. There are many books like Al Brooks, Nial Fuller, YTC etc etc. Then look for threads from Smart_Trade, Pratap, Anvy many others.. (can't recall all the names but I have loved and/or love following them). I have learnt from these people and their threads are like gems. If there is one person you must start stalking D) is Smart_Trade. Read as many of his posts as you can (it will take weeks and months probably to finish ) and you will see changes in your thoughts about market. Other than that there are many many great things discussed in the beginner's thread http://www.traderji.com/beginners-guide/9373-new-members-please-read.html

Above all, you must know that this will take time. It's a journey that you have to enjoy. It's like learning a musical instrument. Learning never ends. It's furstrating at the beginning then you learn a few things and you think you have got it but then you realize that there is much more to it. Then you learn a few more things now you start to see that it is long journey.. nevertheless.. I'm going to have fun with it..

 

[Pradeep Narayan]

Thanks
So for now these are the important points :
1. Knowing about price action and candlesticks.
2. Pick a strategy and backtest it...and stick to it( i am facing problem here as i cannot find recent intraday data for futures for charting)
3. Money Management and Risk Control(i understand that this is the most important )
4. i wanted to try pride's strategy outlined here...
http://www.traderji.com/day-trading/29798-prides-intra-day-strategy-profit-everyday.html
but again i cannot backtest it because of lack of data..
what are your thoughts on this strategy...the owner of the thread said it was old and he doesn't use it anymore...

Thanks a lot for your help...

My 3 paisa...
a. You should have a strategy that suits your profile as a person and as a trader. If you are a person who needs fast results, impatient and action oriented.. then create your own or follow someone's intraday strategy. If you are a person who cannot take life in the fast lane... have a swing trading strategy.

b. Your strategy is only as good as you believe and follow it. If you don't trust and follow your strategy... then it is of no use.

c. I had mentioned this in another thread earlier, but my view is that you should have a clear strategy that provides you LONG opportunities and another one that shows you SHORT opportunities. I feel you cannot have a single strategy for both LONG and SHORT - I know this could sound controversial, but a strategy can provide the entry signal and exit signal... one should not construe the exit signal to be a reversal entry signal.

You need some backtesting, but you can put your strategy to test on a live market scenario. Unless you are into scalping, you don't really require real-time data for testing your strategy.

All the best!