Trading Strategies Using Technical Analysis

[4xpipcounter]

Smartrade, you nailed it!
What is needed to be used in conjunction with supports and resistances is a confluence of events. Somewhere, An S or R will contain, and thrust the price the opposite way. It is a matter of finding a additional events or indicators that says that level will contain.

Support is considered as support till it holds. Once broken it becomes a resistance. Supports and Resistances are known to hold in sideways range bound market action. In strong trend no support is strong enough to hold the prices from going down and no resistance is strong enough to hold the prices from going up.

Supports and resistances are meant to be broken in trends....if they dont how will the trend develop ? So dont consider supports and resistances as something unbreakable.

So many people go contrarian and trade against the trend....but the secret of successful contrarian traders is they go contrarian in the last leg of the move and they have deep pockets. We traders cannot afford that luxury and there is no reliable way of finding out where the last leg of the move is and we dont have unlimited supply of capital....so we should trade according to the trend which is in force.

Whatever I have said above applies to trading....if you are investing with 3-5 years timeframe then it may not be applicable...but even in that case buying when the market turns up with a clearcut stoploss is a prudent way.

Best wishes for your current position....hope you get out with minimum damage.

Smart_trade

 

[Smart_trade]

Smartrade, you nailed it!
What is needed to be used in conjunction with supports and resistances is a confluence of events. Somewhere, An S or R will contain, and thrust the price the opposite way. It is a matter of finding a additional events or indicators that says that level will contain.

True, but I am surprised to see people keep on buying at successively lower supports and holding positions when the earlier supports were collapsing like pack of cards. Once a support is broken, it is a history......and only miracle can save our trading accounts and God does not perform miracles too frequently. We traders need to protect our trading capital with utmost care......

ST

 

[SwingKing]

Raunak sir,

Today was quite a day... I went long Nifty on all supports... 5400, 5360, 5333

And all 5 CEs went dead...

Now, I only have 1 Mininifty March lot bought @5375. As you can see... it went down another 100 points after I bought it... It was a freefall....

What is your opinion for March? Should I get rid of my lot at any pre-budget rally? Will there be a rally at all?

Brent Crude is @$115...

Cheers!

Gauhar,

I think Smart_Trade has answered your query or at least has told you the right thing to do. I would not like to repeat things, but I would definitely like to ask you on what basis you trade.

Since November I have seen you only lose money. You keep buying and markets keep falling. Are you just buying at random or is there any thought process behind what you do? At some stage you need to ask yourself why you trade/invest. Its about self improvement and inspection of your own performance.

I don't mind if you buy when markets are falling. But it is only when you have a definite plan in place. I have seen contrary buyers making lot of money, but they know how to do that and know how to execute trades. If you don't know how to do this, then why do you fight the trend. You can have an opinion and you can be wrong. But when you are wrong, at least try to correct your trades. Don't commit the same mistakes again and again.

Regarding your specific question, I don't know what will happen in March. I am a Biased Investor at this time and hence I am buying because I know how much I can afford to lose. But, I am not buying for March, April .. Etc. I am accumulating good companies at reasonable valuations for returns over the next 5 years. As far as trading goes, the trend remains short and I am positional short on the market and Swing long with half the positions attempting the channel trade. Whether the markets will reverse today, tomorrow or after the budget, I have no clue.

For once, try and trade with the trend. That's all I can say.

Tc

 

[4xpipcounter]

I serve a miracle-performing God. He's also a common sense God. If I do something unwise, he expects me to learn from it, pay the price, and go on with my life. It's part of accepting responsibility. It's a good thing to know you have complete control, because you accept responsibility for what you do. ("You" was meant as a blanket statement not as in YOU)

True, but I am surprised to see people keep on buying at successively lower supports and holding positions when the earlier supports were collapsing like pack of cards. Once a support is broken, it is a history......and only miracle can save our trading accounts and God does not perform miracles too frequently. We traders need to protect our trading capital with utmost care......

ST

 

[akrsrivastava]

I used to live in the UK, where cricket is popular. There is no mention of cricket here in the USA. I wish we and the sport here. I love it.

You can catch the matches at http://www.espnstar.com/cwclive/index.html :thumb:

 

[4xpipcounter]

I saw Pakistan and Sri Lanka were getting ready to play, but the stream is not available in my region. Rats!!!!

You can catch the matches at http://www.espnstar.com/cwclive/index.html :thumb:

 

[4xpipcounter]

Smartrade, I don't have a thing against adding to a trade, even as it backs against you. The thing is there has to be a systematic approach in doing so. Just to add positions to be adding them can prove to be futile. OTOH, and I'll give a personal example from this past week. I entered 3 trades-- USD/CHF, AUD/CHF, and NZD/CHF, in knowing I nailed the reversal area. Well, I was wrong by one support level.I knew they were still going to reverse, because they were all OB on the daily charts, and they were also flying too low beneath the daily clouds, so I added another position on all 3, and even added a CHF/JPY position. Now, I have a composite positive pips.
Someone else that follows my blog loaded up just because "4xpipcounter" made the trade, and then lost. Mindsets and risk appetites are all different. These venues should not be (never, never, never) a place just to copy trades, but a nesting ground for a collection of ideas and learning in order to develop the perfect methodological approach to the markets.

True, but I am surprised to see people keep on buying at successively lower supports and holding positions when the earlier supports were collapsing like pack of cards. Once a support is broken, it is a history......and only miracle can save our trading accounts and God does not perform miracles too frequently. We traders need to protect our trading capital with utmost care......

ST

 

[Smart_trade]

Smartrade, I don't have a thing against adding to a trade, even as it backs against you. The thing is there has to be a systematic approach in doing so. Just to add positions to be adding them can prove to be futile. OTOH, and I'll give a personal example from this past week. I entered 3 trades-- USD/CHF, AUD/CHF, and NZD/CHF, in knowing I nailed the reversal area. Well, I was wrong by one support level.I knew they were still going to reverse, because they were all OB on the daily charts, and they were also flying too low beneath the daily clouds, so I added another position on all 3, and even added a CHF/JPY position. Now, I have a composite positive pips.
Someone else that follows my blog loaded up just because "4xpipcounter" made the trade, and then lost. Mindsets and risk appetites are all different. These venues should not be (never, never, never) a place just to copy trades, but a nesting ground for a collection of ideas and learning in order to develop the perfect methodological approach to the markets.

Well ...depends on how your mental set up is 4xpipcounter. I am never comfortable buying something because the market is oversold because markets can go still deeper in oversold area and stay there for substantially longer time and it is very disturbing psychologically for me to see Mark to Market Loss against my positions. I can never hold a position thinking that soon it will come in profit.

I have seen many trading accounts going dead trying to catch tops/bottoms and adding at supposed top/bottoms. Holding a position in loss is a very negative stimulus for me in trading.I need market to turn up and give me an evidence that the downtrend is over and uptrend has started.

Waiting for the market trend to playout fully has an advantage that you can get the last portion of the trend which is generally very strong and nasty if you are against it. It also gives you a chartbased logical stoploss point if the market has bottomed and turned up......

But as they say every trader is different and so is his psychological set up. We should trade the way we feel comfortable...and that is the key to trading success......

Best wishes,

Smart_trade

 

[DanPickUp]

Hi

I have two question and not any critics.

Doe's any one use tape reading for adding positions beside using charts and indicators ?

Or doe's any one use only different chart time frames and work at the same time with tape reading to make his decisions when adding to positions ?

DanPickUp

 

[4xpipcounter]

Smartrade, I agree with you even if you have a constructive comment against my point. Keep in mind (I know you know this, but I'm sharing my perspective.), just because the market is OB/OS ,that does not make it tradeable. I use a confluence of events to determine my entry. As an example the CHF/JPY hit a confluence of my WR1 and MR2 at .8859, flying too high above the daily cloud, tenken and kijun trailing close behind on the 4-hour in addition to the confluence of price at R levels, momentum goving out by a butterfly formation. All this was in addition to the market being OB. There was only one for it to go, and that was south, so I entered and collected my 80 pips today.

Well ...depends on how your mental set up is 4xpipcounter. I am never comfortable buying something because the market is oversold because markets can go still deeper in oversold area and stay there for substantially longer time and it is very disturbing psychologically for me to see Mark to Market Loss against my positions. I can never hold a position thinking that soon it will come in profit.

I have seen many trading accounts going dead trying to catch tops/bottoms and adding at supposed top/bottoms. Holding a position in loss is a very negative stimulus for me in trading.I need market to turn up and give me an evidence that the downtrend is over and uptrend has started.

Waiting for the market trend to playout fully has an advantage that you can get the last portion of the trend which is generally very strong and nasty if you are against it. It also gives you a chartbased logical stoploss point if the market has bottomed and turned up......

But as they say every trader is different and so is his psychological set up. We should trade the way we feel comfortable...and that is the key to trading success......

Best wishes,

Smart_trade