I have roughly understood the question,Rakesh.......may not be exact in the undertanding.
But just communicating what I do........I don't want even the position sizing to get too much of a rocket science and would like to keep things as simple as possible.
Let us presume I am trading with 10lakhs.Simplistically,I don't mind risking 1-1.5% in that trade.Let us put it at 1%.1% of 10L=10,000.Meaning max.risk in that trade is 10k.
Now,I short the market at 4425 with my stop loss at 4508.Difference of 83 pts.Meaning 10,000 divided by 83=120 shares.So,the max I can short is 2 lots.So we short 2 NF at 4425.......if stops are hit,loss=8,300
ADD 1 is at 4324,now I want to short 2 more lots.Stop loss at 4387,average of 4425 and 4324 is 4375.Difference is 12 points.....if stops get hit,loss=12 x 200=2,400.Is it less than 10,000?Yes it is......so add the shorts at ADD 1.
ADD 2 is at 4280,stop loss at 4360,Average of 4425,4324,and 4280 works out to 4343,.....Difference between avg and stop=17pts....if stops get hit,loss=17 x 300=5,100?Is that less than 10,000?Yes it is......add the shorts of 2 lots more at 4280.
ADD 3 is at 4246,Average now is 4319,stop loss at 4352.........Difference is 33 pts....if stops get hit,loss =33 x 400=13,200......Now I am not overly concerned with the mild peep over the 1% mark,I would take that 2 lots.But if you are uncomfortable,short only 1 lot,your avg now works to 4329.Stops at 4350.Difference is 21 pts....If stops get hit,loss =21 x 350=7,350.
For me,I would take both the 2 lots....but up to your Rules of your Plan that you have drawn up.
Saint