Following invaluable readings have been collected form my Guruji's site and also include quotes of my seniors.
Anmol Vachan
-> Mkt has no place for emotional traders
Trading is a zero sum game and here money goes from the emotional traders to the mechanical traders.
-> No big money could be made without "sweating". And "sweating" need not be a slog under the sun that brings out the sweat. It could be also the "mental fortitude and composure" required to keep faith in your own study
-> There is no secret..It is you. Repair your headlight well and focus, believe...everything happens.
Die to each moment..take rebirth to each moment. Discard past , embrace the present
Price
What is this price watching which becomes a prime factor in preparing a trading plan..?
The charts, where in the prices are plotted, shows you cluster areas where index/ scrip meets with selling pressure or buying supports. You spot the clusters prominently in Hour charts or lower Time frame charts.
One such cluster is "5605-10".
Now if you combine few other studies such as Tech.table, for eg:, it has not given even a "sell on rises" as it has not closed below HHEma(5570). So if you initiate a "sell trade" here based on previous history, it is an aggressive trade, requiring tsl.
TT also shows you the next number Nifty has in mind which is monthly ema-5659 relevant tomorrow, provided it holds above HLEma or DHEma(5540-5525)
Since the rise has been sharp, it carries with it the momentum to push through resistances.
As a classic TA follower, you observe "Negative divergences" developing and it can continue for some hours during which more highs could be made.
As a EW follower, the minor waves of the "supposed vth wave could pose few challenges at sub (iv)th.
Know your study well and be conscious of the reasons that you initiated a trade and act to execute your SL diligently and "Always part book". Never damage your wealth.
If it is aggressive, know how it is to be executed....
Reading Oscillators
This indicator gives you the lead. Once it reaches above 80 mark, it becomes Overbought. But the moment it starts to make the "dots" and stay above 80, know that it is trending up. Similarly for "Downtrend". Only in a sideways market does it oscillate between 80& 20.
My Guru's words
-> It is a speculative market where prices rise & fall based on the strength of the player who can back his positions. It is as simple as that. The moment FII's start the buying, it trends in that direction.
OI analysis help to assess FII's behaviour.
It surprises one & all. As long as you are on the side of the trend(depends on your Time frame), those surprises would be pleasant ones.
-> EW is a tool to "Make some some sense out of the maddening market" and in that process it throws up some excellent trade set ups. take advantage of them. As you go into micro EW Labelling, it could become highly challenging & often results in losses. In the day T/F, it works quite well.
There is no study in the world that gives you 100% results. A 60-75% success rate with risk management is all that is required.
Use any tool/ study to make money..not to prove its worthiness.
-> Look at your trading horizon and initiate a trade based on the levels break-out or break-down & alternatively "buy near supports and sell near resistances".
In Hour Time frame, you can use 21 Hour & 35 Hour to ascertain the intra moves. (Remember also of mean regression -once the prices go far away from the averages, they tend to bounce towards them).
In Day T/F, 5Sma or 5-Ema has been a simple indicator to stay long or short.
High ema for momentum up & Low ema for downward momentum. All these are incorporated in the Tech.table (TT)
->"Lead indicator" has reached the "Overbought zone" but not yet given any "sell indications". It generally takes a minimum of two days to reverse if there is a reversal.
-> Whenever we prepare a trading plan based on a single number, try to look for any crucial support/ resistance points near by and use them to manage that trade.
Nifty ploughs through all resistances & sadly brought out the worst in people..
There are various studies to make your trading plans. Some of these studies could be used only as a supporting factors(indicators), some for directions(EW) but the most important and primary study is "Price behaviour observed as Higher High & Higher Low for uptrend OR Lower High & Lower Lows for down trend and Rangebound in a Sideways trend. Depending on your chosen time frame-5 min/ 15min/ 30min/ Hour/ day, etc., choose a combination such as Day & Hour or Week & Day or Hour & 5 min and study the prices by giving more weightage to Higher T/F.
Tech.Table don't lie especially for most of the traders here who trade the short term looking for 30,50,100 points. TT is just a reflection of prices.
If your plan was to reverse your shorts above 5363(JNSAR) or 5375-as discussed here often, what stopped you.?
What is the use of "Pre-Market Trading plans" if it does not come to anyone's use..?
Why everyone wants to know where the market will be on settlement day or at the end of the day or in two months time..? Such opinionated utterances distract everyone. It does not help anyone if you said few days back that market will go to 5700 or 5450 or 5100. You distract the traders here from observing the "unfolding prices".
What are you..? Are you a Classic TA follower, following the market using few indicators such as macd, Stochastics and HH - HL & LH - LL and so on and what did it lead you on to..?
Are you EW follower..? What was its short term direction and what are its invalidation points..? And what did you do..?
Are you a JNSAR follower..? What was its reversal point and why there was disbelief when it triggered a buy..? Biased..?
Are you a Open Interest follower..? What did it suggest yesterday and in today's opening session..?
Are you the "Havala rate" follower..? Did you abide by it..? @ 5412.
Let the damn market do anything it wants to do.. You do what you got to do. To hell with gap ups and gap downs.. To hell with operators who take the blood out of small traders. Know the playing rules. Know your limitations. Within those, devise your plan and extract your "Pound of flesh"..(Vegetarians..excuse me, please.)
Do not berate yourself, if you have missed one trade..today. Believe in your studies. This is the slap market gives when you loose concentration. Be prepared for contingencies - when in downtrend, devote some time to "think like the bulls" and when in uptrend, spare a thought to the "likely bear approach". Do these when market "Stalls"..or when market is not following your "estimated route".
Believe me..when I say this.. Just as we made 1000+ points last month, we'll make as good this month too. And in the coming months too. Let us say, May month was exceptional. Keep then a 300 to 500 points per month. Bring in that discipline. And stop gloating on your winnings.
Get Rich Slowly and Quietly.
Believe nothing just because a so called wise person said it, believe nothing because some one else believes it . Focus more on response than outcome , have in mind what your response will be if Market does that rather than caught in the wishful thinking of Market's outcome.
Alan Farley writes - "Experienced traders control Risk , inexperienced traders chase Gains" .
"Only closing prices alter the trend. Hence, trend remains down."
"If monthly, weekly & daily in sell mode then how long hourly buy may stay."
Do not think that why stock or Index not going ur way, but find out that why u were not following its way". So i always want to remain follower of Nifty & Bank Nifty:
How to gain in Trading
one can not gain in trading with so many if & buts. 1st identify trend & proper stop loss, then execute ur trade & book in part if it goes in ur favour. If it does not work in ur favour then check ur plan without having any trade in hand, picture will be more clear to you.
Trading sideways market
Identify the commencement of a sideways market once market closes below DHEma in uptrend and above DLEma in downtrend and look for support/ resistance cluster points based on earlier price behaviour as well as the developing one and combine the same with fibonacci retracement points and TRADE. TRADE means sell to buy and buy to sell and not hold till prices are reversed as in a trending market.
Make 15 points or 25 points. And miss a potential trade. Do not worry. And a potential trade stops out - accept this trading loss. And keep a reasonable SL closer to supports for Longs and closer to resistances for shorts and trade. Ofcourse, you can choose to sit out and watch the market action and play it in your mind "if you had gone long or short at a particular level - what is the result?".
Not doing any trading for 5 to 6 days would protect your capital while you observe a potential trade set up developing.
Watching the market, thus, educates you of market's "whipsawing nature" which is actually "whipsawing our perceptions". Market moves to new high with a 2 point move to 5540 today which falls right into the potential resistance zone of 5535-5545.
About your trading system - it works differently in a trending market and in a sideways market. Know this essential difference and you will start trading with ease.Feel the market; Use the system to make more profits and less Loss.
