Cool... got it! let me explain how do i trade. Even I trade only in Stock futures;
i usually start with intraday position at the beginning of the trade. I select 4 to 5 stocks based on NR7 setup and enter into trade once the high/low price is triggered.
I make sure that I do not trade on 2 stocks on same sectors, all 4 to 5 stocks must be in different sectors. So that even if one sector does not give the expected break out, the other sector would tally it.
Also I calculate the loss that I would incur if I trade on any particular stock. Based on Risk reward ratio, I short list 5 stocks.
Coming to the trade, I decide the following factors before I enter into trade.
Entry: Based on NR7 High/Low
Stop Loss: Short Trades (NR7 High) and for Long Trades (NR7 Low)
Target: Check the NR7 range. i.e for example, if M&M NR7 days range is 20.
Then our target should be 20*150%=30. So if we short at 770, our Stop Loss 790 and Target will be 740. Even if it comes near 740 also you can book profits. Need not wait till 740 to reach.
Trailing Stop Loss: One of the most important factor, if you fix it perfectly then you can bang on maximum profits.
First I will wait for the Target to achieve.
Once the Target is achieved, then I perform the following calculation.
Current Price + NR7 range (short trade)
Example = M&M target achieved and current price is 740.
Trailing Stop Loss = 740 + 20(nr7 range) =760
Current Price – NR7 range (for Long Trade)
With Regards to Intraday:
Most of the days when I did intraday with NR7 setup, the stock would break the NR7 Low/High but it will trade flat and end of the day it will close between low and high. There by I incur minimal loss but if I had carry over that position, then in another day or two the stock would give big breakout.
Once I observed it, then I started carrying over my position and hold it 1 or 2 days. 90% of my positional trades were profitable.
With my experience so far with NR7, what I observed is most of the time you can reap the maximum gains if you STRICTLY follow the SL and TSL.
In order to gain maximum profits, we should have the courage to lose our profits. On paper trade anybody can follow the TSL method. But when you are trading with futures, you need to lock in profits then and there. Once you build a profitable ledger balance, then you can think of following TSL. Untill you reach that level, better follow the TARGET alone. Once the target is achieved, book profits and look for another great trade.
Believe me, I have been trading for more than 5 years.. I have tested numerous strategy, tried all kind of options(strangle, straddle, blah, blah) But none of those trades gave me a peace of mind. Because I never clearly know what will be maximum loss, minimum profits. So end up with 5 profitable trades and 1 loss trade which wipes out all my 5 profitable trades.
NR7 Setup is one of the easy to understand setup, anybody can follow it. I assure you, if you trade with discipline, am sure your monthly payout will be in profitable position. So I kindly advise everyone to follow the NR7 setup rule alone, don't mix up EMA, SMA, etc. Just try few trades with NR7 setup alone, you will understand
