Disclaimer


The author is a SEBI Registered Research Analyst (INH000004796) and a NISM certificate holder in Equity Derivatives Market. The certification is provided by National Institute of Securities Markets.

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Friday, January 31, 2014

31/01/2014


Traded NS as underlying. Nifty opened near PDH. IR formed. After formation of IRH price alomost came back to test IRL in the first 20 min Price got rejected there. Did not short on BOF IRH as no space. When Nifty did not break IRL I suspected a range move between IRL and BRN 6100. Took a long as Nifty did not break IRL with a 10 point stop, target being IRH. TP at IRH. No more trades for the day.

Thursday, January 30, 2014

30/01/2014


Did not trade today. Nifty gaped down(AGAIN!!). IR formed. Would have gone short on Break of IRL.
The short never went above IRL even. Would have made 20 points. BOF LOD was a signal to go long, though MSP would have resisted.

Wednesday, January 29, 2014

29/01/2014


Nifty gaped up but could not sustain above PDH. Took BOF PDH short on break of IRL. Took it a little late as a pin bar was created immediately after BO of IRL. Covered at pin bar formation at PDC. Did not go long on BOF PDC as no space. Again short on break of MSP. Shorted at 6130. TP at 6110. Fed the order this time.

Tuesday, January 28, 2014

28/01/2014




Arrived late for trading.Announcement day too. Nifty opened around PDL. IR formed. Did not get chance for BOF IRH as it was a very fast move. Took BPB PDL short. LOD was my target. Ended with covering with a 15 point profit. Shorted again on TST signal. SL hit. Shorted again BOF PDL.Covered on inside bar formation. PDL resisted upmoves by Nifty after announcement.

Monday, January 27, 2014

27/01/2014


Nifty opened with a huge gap down of 80 points. Thought that the whole day would be flat. Though of only scratching trades today, if any. Went short on TST IRL. Covered the position with a 13 point gain. Took another short as BOF IRL for a 18 point gain. Did not take BOF Range low as was not expecting further selling at that point.

Sunday, January 26, 2014

Coaching Oneself!!


All great achievement starts with the self. The burning desire to achieve our set goal and move towards it step by step is the main precursor to be successful. For all achievement there is a process.
The individual has to find the process which suits his style and helps him reach his goals. Self talk, according to me, plays a very important role in finding the process which can be structured and followed to achieve our goals. Coaching by mentors, seniors also goes a very long way in helping in this direction.

How about coaching oneself??

The trades which we take on a daily basis teach us a lot. I personally go through a run down of possibilities which happened in previous cases, if I feel that a particular pattern is going to work out again.
 For example:
On Friday's trading session there was order accumulation around range low. I was not ruling out a PP pattern which could have gone on to test and break all DPs above the range low as BRN, IRL,PDL etc. But bearishness was evident as the price did not even break the range high.
In short, the set up 'taught' me to be ready for possibilities.

I feel that such 'probable' set ups ask us to be 'prepared' with a 'plan' so that we can 'perform' appropriately.Thus trying to coach oneself at every such possibility.





Friday, January 24, 2014

24/01/2014


Nifty gaped down but managed to close above PDL in the first five minutes. IRH formed. Push above IRH did not come about. Took a chance and shorted as BOF IRH. Another short on BOF PDL. Target was BRN. But price sliced through it. TP at inside bar formation at 6280. Another short on first TST of range high. TP at 12 points on formation of engulf candle.Short again on second test and BOF of range high. TP at bullish bar

Thursday, January 23, 2014

23/01/2014


Nifty opened below PDC, formed IRL, moved up and faced resistance at PDC. Short on BOF PDC, scratched the trade.
Did not take second BOF PDC as was suspecting swing low 6332 to resist. Long on BPB PDC.
TP at PDH

Wednesday, January 22, 2014

22/01/2014


Nifty opened and went below PDL and BRN but dashed right back above DO. Thus BOF PDL/BRN and LOL formation. Went long above DO. Noticed order flow at 6320 as price got rejected thrice there. Attempted Sniper Shot with previous day's swing high(SH) 6334 as target. Was able to do it.Squared off long also at Rejection bar at PDC. Took short BOF PDC. Scratched. Went long on BPB PDC with target as PDH. Squared off at inside bar formation. Again went long on BO PDH at 6345. TP at 6360.

Tuesday, January 21, 2014

21/01/2014


Arrived late for trading. Nifty was trading above PDH mostly clocking a High with a Pin bar. It was a sign of rejection. Could have taken the trade with PDH as first target and PDC as second. Suspected first TRAP with BOF MSP. Did not take it as was late for trading . Took BOF PDH short. Covered it with the rejection and a inside bar candle again at MSP. Suspected second TRAP which broke PDH but could not sustain. No more trades as no sufficient space for the trades to move.

Monday, January 20, 2014

20/01/2014


Nifty opened near PDC and closed near PDL in the first 5 min candle. Did not go below PDL. IR formed. Went long on break of IRH. TP at BRN. Did not short on TST of the vertical move as no space. Shorted on BOF BRN. Thought of PDC as the target. But the trade did not move as expected. SL hit. Did not take any other trade as I was suspecting BW around BRN. Missed the last upmove.

Sunday, January 19, 2014

Mental Rehearsal for trading


Hi all,

Over the weekend I was going through a book named, Psycho- Cybernetics.


In the few topics which I have gone through, the mention of self-image is very prominent. It says that even if we have the best of circumstances and the best of everything, we will only succeed to the limit of our self image.

Our self image is created by the thoughts which we hold in our minds by hearsay, experience, what elders have told us and the like. 

It says that if we want to improve, we need to improve our self image, what we think of ourselves.

The topics emphasize the need of holding mental picture of ourself in our mind's eye.

It says "Picture yourself vividly as defeated and that alone will make victory impossible. Picture yourself vividly as winning and that alone will contribute immeasurably to success. Great living starts with a picture, held in your imagination"

The mental picture has to as detailed and vivid as possible while rehearsing and action has to be taken on it.


It says that the human nervous system cannot tell the difference between an 'actual' experience and an experience imagined vividly and in detail.


If we can apply the same concept for trading, and rehearse in our mind's eye the trades which we want to take, I would be very interested to see if we can actually raise the bar and perform at the next level.

Glossary


BRN= BIG ROUND NUMBER

NF= NIFTY FUTURE

NS= NIFTY SPOT

PDC= PREVIOUS DAY CLOSE

PDH= PREVIOUS DAY HIGH

PDL= PREVIOUS DAY LOW

BOF= BREAK OUT FAILURE

BPB= BREAK OUT PULLBACK

TST= TEST

FTC= FAILURE TO CONTINUE

MSP = MAJOR SWING POINT

DO= DAY OPEN

HOD= HIGH OF DAY

LOD= LOW OF DAY

DB= DOUBLE BOTTOM

DT= DOUBLE TOP

PDM= PREVIOUS DAY MEDIAN


Saturday, January 18, 2014

Nifty HLR(18th Oct 13 to 17th Jan 14)



                                       Range expanding. Range between 0.5 to 2. 

Friday, January 17, 2014

17/01/2014


Nifty opened below PDC and rallied to test PDC. Could not trade above it. Took BOF PDC short. Target was PDL/BRN as both were close to each other. TP at BRN. Didn't go long on the DB formation which later got converted into MSP. Didn't go long as I was suspecting LOL resistance( BRN and PDL) as traders were short and would short on any rally. Short on BOF PDL(later it was BOF BRN also). Didn't wait for MSP to be taken out to go short as LOL was already pierced. TP around 6260.

Thursday, January 16, 2014

16/01/2014




Nifty opened above PDH and sold off. Short on first BOF PDH. SL hit. Again shot on second BOF PDH. BRN 6300 was my target. Trailed the position and TP around 6310 as there was a Pin bar formation near LOD. Entered long on BPB range low. My target was PDH. TP at PDH, also was ready to trail position around IRL. No more trades.

Wednesday, January 15, 2014

15/01/2014


Nifty opened above PDC and spiked. Did not enter as BRN above. Long on a minor PB at BRN. Booked at FTC. Missed the chance to go short. Long again after MSP formation and above PDH. Again booked out at initial FTC area. 

Tuesday, January 14, 2014

14/01/2014


Nifty opened inside yesterday's range. IR formed. Basically Nifty traded in two ranges. Didn't take BOF IR1H as IR1L was too close. Shorted on break of IR1L. Yesterday's median of 6250 was the expectation.
After the BO from the IR1L nifty drifted between R2. Covered the short at 6250. Went long on BOF median/LOD  TP at 6270, IR1L. Yesterday's median working as support broadly.

Monday, January 13, 2014

13/01/2014


Nifty gaped up. Didn't enter on 3rd candle as PDH above. Shorted BOF PDH, fluid till LOD was the inspiration. Had to cover at 6240 as prices stalled there. Long on BOF range low. Target was again range high. But the BO candle above range high prompted to TP at BRN 6300. VWAP, I guess.

Saturday, January 11, 2014

Trades with LOL formation


In DP trading parlance, LOL is Layer over Layer and not the usual social media usage.
I got to learn this method from ST's blog Nifty Nirvana. Click Here.
This is a formation where two or more S/R levels are close to each other.
In the above exhibit look how the price moves above PDC, an important DP. Above PDC the traders will act forcefully and take long positions again. In this case we have PDH above PDC(a LOL). The traders would take positions on the BO of PDC in the hope that the prices will cross PDH. The pin bar at PDH is a signal that the long traders want to book profit who are already long from BOF BRN. Now the next candle which breaks below PDH and the consecutive retest of PDH confirms the view that the long traders want to book profits.
Here panic sets in the camp which has bought on the break of PDC. There is a domino effect as the long traders who are holding on to their positions from the BOF BRN level, book their profits and also the traders who are caught on the wrong foot by entering on BO PDC want to exit at any price. This results in a vicious fall forming a new low for the day.
LOL formations should be watched out for and action should be taken decisively.Usually these trades are safe and a pin bar formation around the higher/lower layer gives the indication that a reversal is coming.
Watch out for LOL.


Nifty HLR(10th Oct 13 - 10th Jan 14)


The above exhibit is the Nifty HLR as % of close from 10th Oct 13 to 10th Jan 14. As seen, the HLR range is from 0.5 to 2. The range is at the bottom of the reading indicating possible increase in the High-Low range which can present decent intraday opportunities to trade.

Friday, January 10, 2014

10/01/2014


Traded BN. BN opened nead PDC and sold off immediately. Could not short on BOF PDC. IRL formed and prices retraced to PDL and BO occured. Entered on small PB as BPB. There was space for 40 points so took the trade. Prices rallied to form HOD. Didn't short on FTC of the vertical move. as IRH and PDC were just below. Prices took support at PDC and again BO happened above IRH. Didn't enter on small PB as HOD and PDH were above and didn't find space. Finally the failure to test happened and also a LOL formation with PDH above. Short on LOL formation. Trailed this position to carry half home.

Thursday, January 09, 2014

09/01/2014


 Traded BN. BN opened near PDC after the initial tail rejection. Tried to cross PDC but failed. Shorted on BOF PDC. TP at earlier MSP 11030. After that BN rejected the low at 10960. Rallied upto MSP. Short again at earlier MSP as BOF MSP for 40 points. At the fag end BN took out MSP but could not cross PDL. Didn'r take BOF PDL.

Wednesday, January 08, 2014

08/01/2014

 
Traded BN today. BN was also trading in a range the whole day today. The range being IRH and IRL.
Could not take BOF IRL of 10:00 as I arrived late. Shorted BOF IRH for a gain of 40 points. Again went long on BOF IRL for another 40 points. Finally went short on BOF IRH minor PB. Covered at BRN 11000
A lengthy consolidation day.

Tuesday, January 07, 2014

07/01/2014



Nifty opened above PDH and sold off. Shorted on BOF PDH. TP at BRN 6200. Nifty gave a minor PB around BRN after forming LOD. Didn't short there. In hindsight should have got 15 points. Long on break of MSP. TP at 6220 which was already punched in the system after the long was taken. 6220 because profit was enough and PDC was overhead. Shorted on BOF PDC. TP again near MSP. Choppy day.

Monday, January 06, 2014

06/01/2014


Nifty gaped down but did not trade below PDL.Nifty clawed back to IRH confirming it. Nifty was forming BW around 6200(S) for a long time. Took BOF IRH as first trade. Covered the short as Nifty turned volatile around 6210(F). Didn't take BOF PDL long trade. PDL held today in trade.

Saturday, January 04, 2014

Median getting converted into MSP






Here I try to show how whenever there is a Median formation due a big day for the Nifty, it usually gets converted into a MSP for future trading sessions.

In the first exhibit, the previous day( 18th Dec 13) was a big day for Nifty and thus it had a median at 6207.
On 19th Dec 13 we had a BOF PDC and Nifty had a vertical fall. At around 2:20-2:30, the prices started flirting with previous day median (PDM). Finally we had a BOF and Nifty started drifting lower.

In the second exhibit, on 20th Dec 1 Nifty opened near PDC and rallied. At around 11: 40-11:45, the Nifty broke PDM and tested it only to rally further. At this point the PDM gets converted into MSP.

The big day of 19th Dec 13 made a median at 6232. On 20th Dec we already saw how the Median on 6207 became MSP. On the same day after rallying past that point of 6207 prices went past 6232 for a bit and tested it, which was the PDM(for 19th Dec). Nifty rallied from 6232 and went till 6250 and again retreated to test 6232 to rally further to form HOD at BRN. Again the PDM of 6232 gets converted into MSP.

The third exhibit is a club of both the days.

I urge traders to keep a close eye on the median of a big day for Nifty. More often that not that point/zone gets tested before moving on and in due course forming a MSP.

Nifty HLR (3 Months)


The above exhibit is the Nifty High Low Range (HLR) as percentage of close. This range is for the period
of 3 months from 4th Oct 13 to 3rd Jan 2014. A tradable range looks like between 0.5 to 2.
Currently we are at the lower end and the slope is rising indicating trading range on a daily basis to increase.

(This method belongs to Mr. Sunil Saranjame of timamo.blogspot.com
Unfortunately the blog is not available.
For loads of market metrics and such exhibits he can be contacted at sstimamo@gmail.com)

Friday, January 03, 2014

Plan, Believe and Act. Way to go in 2014


Johnathon Fox, a forex trader on his site writes beautifully about the power of Setting goals, Seeing them as if already done, Dreaming big and taking Action.

I am sharing the link.

Read about the Article.

BN 03/01/2014



                                     @ Karthikeyan, Missed the first trade. Took the second.

03/01/2014


Nifty gaped down and was in a channel. Shorted BOF IRH and covered when it didn't break LOD and formed a DB at 6210. Long on BPB of flip zone 6220. Trailed and TP at PDC.

Thursday, January 02, 2014

02/01/2014




What a unexpected field day for short sellers. Arrived late for trading. Missed the initial burst. FTC of the vertical was a probable signal to go short. Another was BO Consolidation but PDH was below so no space.
BPB PDH was the mother of all trades today. Shorted there to TP at 6260 NS as was expecting that swing to hold. Another short as BOF of previous swing. TP at the end.
Complacent bulls shaken today, I guess. 

Wednesday, January 01, 2014

1/1/14




Came late for trading. First two candles were wild. Shorted on BOF PDH. TP as prices didn't go below DB formed at PDC. Didn't take BOF PDC as no space for the trade to move.