SH's 315 Strategy - how to use if effectively

[Tradewithhunter]

What is the reason to trade with Futures, can we not do this in cash?

you can use 315 for cash as well as futures.

Cheers
SH

 

[Tradewithhunter]

100 points up today from 5025 yesterday... hope for more in coming days.

Cheers
SH

 

[Tradewithhunter]

Mild gap up today .. 3 EMA not touching the EOD candle hence booked at 5142. Waiting now to re-enter at 3 EMA touch around 5100-5110.

Cheers
SH

 

[Tradewithhunter]

Re-entered at 5108 now at 5133 .. bring it on :thumb:

 

[rkkarnani]

Mild gap up today .. 3 EMA not touching the EOD candle hence booked at 5142. Waiting now to re-enter at 3 EMA touch around 5100-5110.

Cheers
SH

TWH, Dont we wait till just before close to see whether or not a Bar has touched 3 ema or not and then exit!!! My understanding is that there will be very many days when price gaps up a bit stays up w/o touching 3 EMA and in latter half come down to touch it. Was this action preempted by you or this we follow as a rule!!

Now today if the Price bar does not come down and touch the EMA do we exit long ?

Please reply per your convenience!!!
Regards.
-R K Karnani

 

[Tradewithhunter]

TWH, Dont we wait till just before close to see whether or not a Bar has touched 3 ema or not and then exit!!! My understanding is that there will be very many days when price gaps up a bit stays up w/o touching 3 EMA and in latter half come down to touch it. Was this action preempted by you or this we follow as a rule!!

Now today if the Price bar does not come down and touch the EMA do we exit long ?

Please reply per your convenience!!!
Regards.
-R K Karnani

This is an excellent question RKKarnani and worth spending time to answer it at length to make it clear.

The thumb rule is that if the current candle is not touching 3 EMA we exit immediately irrespective of whether its 10 AM in morning or 3.25 PM. We exit at that point and re-enter when we see a current EOD candle touching 3 EMA. However this is relevant when we get a BIG gap up (or down for shorts).

On small gap up days where the distance between todays candle and 3 EMA is not that great, you can hold your positions instead of exiting immediately until 3.25 PM. This is becuase its possible that markets continue to go up throughout the day and hence pull the EMA up with it making it touch the candle at the candle's lower body.

Alternatively on small gap days, you can book at opening price, check where 3 EMA is at that point ... and re-enter at that level without waiting for visual 3 EMA touch. For eg today this is what I did today, NF booked at 5142 in the morinng itself since 3 EMA was not touching at that point. I checked 3 EMA level and it was at 5108 at that point. I placed a buy order immediately at 5108. I also put in a stop loss buy order at 5160 in case NF went up later in the day which would have pulled the 3 EMA along with it making it touch the candle.

Mkts fell and my 5108 buy order got filled. Now mkts have closed at 5122 levels and 3 EMA is still not touching the candle. Hence I should have booked my NF longs as per 315 today at 5122 around 3.25 PM

Basically the net result of the 315 trade till now should be:

Bought NF at 5025 sold at 5142, profits = 117 points
Bought NF at 5108 sold at 5122, profits = 14 points


Now as per 315 people should be empty handed waiting to enter longs again at 3 EMA touch.

(Pls note though that I am still long in NF and short in ICICI Bank at closing price based on some other strategies I use along with 315)

Hope this helps rather than confuse further....

Cheers
SH

 

[jeetu888]

how have u decided to re enter at 3ema 5100-5110 , because in google fin. it was above 5140 at 10.10am

 

[Tradewithhunter]

how have u decided to re enter at 3ema 5100-5110 , because in google fin. it was above 5140 at 10.10am

Jeetu ... I am talking about 3 EMA on daily charts ...... it cant be above 5140 at 10 AM since for that to happen Nifty closing prices average for last 2 days would have to be above 5140.

at 10.00 AM, the 3 EMA for EOD candles (daily candles) was at 5108.

Cheers
SH

 

[rkkarnani]

This is an excellent question RKKarnani and worth spending time to answer it at length to make it clear.

The thumb rule is that if the current candle is not touching 3 EMA we exit immediately irrespective of whether its 10 AM in morning or 3.25 PM. We exit at that point and re-enter when we see a current EOD candle touching 3 EMA. However this is relevant when we get a BIG gap up (or down for shorts).

On small gap up days where the distance between todays candle and 3 EMA is not that great, you can hold your positions instead of exiting immediately until 3.25 PM. This is becuase its possible that markets continue to go up throughout the day and hence pull the EMA up with it making it touch the candle at the candle's lower body.

Alternatively on small gap days, you can book at opening price, check where 3 EMA is at that point ... and re-enter at that level without waiting for visual 3 EMA touch. For eg today this is what I did today, NF booked at 5142 in the morinng itself since 3 EMA was not touching at that point. I checked 3 EMA level and it was at 5108 at that point. I placed a buy order immediately at 5108. I also put in a stop loss buy order at 5160 in case NF went up later in the day which would have pulled the 3 EMA along with it making it touch the candle.

Mkts fell and my 5108 buy order got filled. Now mkts have closed at 5122 levels and 3 EMA is still not touching the candle. Hence I should have booked my NF longs as per 315 today at 5122 around 3.25 PM

Basically the net result of the 315 trade till now should be:

Bought NF at 5025 sold at 5142, profits = 117 points
Bought NF at 5108 sold at 5122, profits = 14 points


Now as per 315 people should be empty handed waiting to enter longs again at 3 EMA touch.

(Pls note though that I am still long in NF and short in ICICI Bank at closing price based on some other strategies I use along with 315)

Hope this helps rather than confuse further....

Cheers
SH

SH, Thanks a lot for a detailed reply!!! In the highlighted portion above when you say 'current candle' I can safely presume you are referring to the Daily Candle and does not refer to any smaller time frame candle.
Though it get a wee bit subjective but also can understand that this subjectivity cannot be avoided!!!
Every time the market opens beyond 3 EMA we dont exit, and this happens a number of times, hence I feel its a subjective decision and different ttraders wud take different actions. No harm inthat till the basic premise and rules work!!!
Thanks again.
-RKK

 

[gkpc]

Mr.R.K.Karnani, You are disrupting the normal flow oh the thread and without any rhyme and reason trying to discredit a simple and superb strategy which the gentleman has so kindly shared!!!
-gkpc