Learning to catch High Probability Breakouts

[amitrandive]

McDowell-N-I approaching a support level.
Looks like profit booking is near.Have to put in a strict stop loss to maximise profits as McDowell-N is a highly volatile stock.

Arvind-I facing some resistance around 240 levels.Need to trail stop on it as well.

Mcdowell-N-I exited yesterday on EOD price as indicated earlier, near a support level.

Arvind-I stop trailed to 225.

Latest Position.

 

[raghav.sriniwasan]

403 forbidden has given a key to the "Khazana"

Thanks a lot for the same :thumb:

I use Amibroker to plot RS charts.
Its a very simple method, one of my old friend calls it KISS,,,

KISS ---> Keep it Stupid Simple.

After going through various systems methods,
i found this suits me the best (for my age too )

For charts and terminology you can follow the said link only

 

[amitrandive]

My Day Trade on 8/7/2014(Rail Budget)

Nifty Futures-3 min Chart

 

[dell]

My Day Trade on 8/7/2014(Rail Budget)

Nifty Futures-3 min Chart

amit bro ,
what extra thing's are u look for entry ?
as i see u not take all crossover of ma ,
also u are taking short trades when small ma is above the big ma (first trade of today ) ,
also u take short trade when small ma is below the big ma (second trade ).
u are able to enter just before the dip , also not trading all crossovers , what i am missing ?
is there any extra logic u are looking for entry or to filter whips ?

 

[amitrandive]

amit bro ,
what extra thing's are u look for entry ?
as i see u not take all crossover of ma ,
also u are taking short trades when small ma is above the big ma (first trade of today ) ,
also u take short trade when small ma is below the big ma (second trade ).
u are able to enter just before the dip , also not trading all crossovers , what i am missing ?
is there any extra logic u are looking for entry or to filter whips ?

Dell

Many times I am Lucky !!!

Also I get some great advice from Experienced seniors in Traderji.

http://www.traderji.com/technical-analysis/69380-charts-day-134.html#post982112

http://www.traderji.com/technical-analysis/69380-charts-day-135.html#post982416

See the attached chart for my trade and reasons for that.

I missed the last leg of the fall.But I think that was better than trying to over trade and loose all profits.

 

[amitrandive]

Latest Position

Trail Stop hit in Arvind-I.Now no open positions.

 

[amitrandive]

Just an example of how chart reading precedes news.

Attached Chart of McDowell-I.Our chart gave signal to short on 11/6/2014.So we went short.

Refer newspaper article on 20/6/2014,which states the reason for McDowell-I tanking.
We are short much earlier to this news, so our stop loss is very high.
http://articles.economictimes.india...ws/50739070_1_open-offer-usl-acceptance-ratio

We covered at a good support area around 2400 on 7/1/2014.Before the news in the paper on 2/7/2014.

http://articles.economictimes.india...ws/50739070_1_open-offer-usl-acceptance-ratio

Traders who would have been short are trapped as McDowell-I rallies and hits their stop after 3-4 days.We have already booked a handsome profit.

This is still a weak stock , so the downward journey continues and stock hits 2300.See the downward trend line still intact.


Lesson Learnt: Do not trade on News .Price action always precedes the news.

 

[amitrandive]

Do You Have A Methodology To Trade Gaps?

http://www.smbtraining.com/blog/trading-education-do-you-have-a-methodology-to-trade-gaps

When a stock gaps outside of the prior day’s range you have three options. Play it for a continuation in the direction of the gap, play it to fill some or all of the gap, or simply take a pass on trading it. I have found over the years that most traders consistently choose the same option each time disregarding many factors that favor choosing one option over another. Why is this the case? For many it is a lack of methodology for trading gaps. For others it may be they are just more comfortable fading stocks versus following the trend. And finally some traders simply prefer being short over long or vice versa.

Whatever the reason is for the lack of differentiation one thing is clear. Most traders aren’t making optimal risk/reward decisions.

so a trader must understand the difference on managing a short trade versus a long, but if they have that skill then they are doing themselves a disservice by not taking the trade with the best risk/reward for a given scenario. And if they don’t possess the requisite skill perhaps they should consider spending more time working on their game?

Here are some of the things one should consider before trading a gap:

• Has a trend been established prior to the start of the regular trading session
• Has the stock recently moved higher/lower a large percentage
• What type of catalyst is causing the gap: Earnings, Market, Sector, Governmental Action
• What type of “market regime” currently exists
• How heavy was trading volume before the market has opened
• What have stocks with similar types of catalysts done recently

 

[amitrandive]

Spot Nifty Weekly Chart

Market in a consolidation phase on a Weekly chart.Decisive breakout once it breaks either of these two levels.

 

[amitrandive]

Spot Nifty Weekly Chart

Market in a consolidation phase on a Weekly chart.Decisive breakout once it breaks either of these two levels.

Spot Nifty Weekly Chart

Market still between the two levels.Though there was a close above 7800 on daily levels on 24th July, the weekly level failed to close above 7800.
It would be interesting to see how the next week which is expiry week plays in terms of these two levels,where the prices have been consolidating for around 7 weeks.