Tuesday, February 25, 2014

Trade with Trends

Dear friends I came through different strategies followed by different technical analysts. But, every time I confuse about the entry point (Long or Short) and exit point. Another question always arise, how I confirm the trend of a stock and accordingly I enter into the trade. It is not a question how many points you earn but it is always questioned ...Are you follow the trend. I show you here, how the stocks behave in different situation.
Suppose a stock in bullish region but the price comes down. We think it may slide and enter into a SHORT trade. But, the stock give a pullback and your STOPLOSS hit. You suffer a loss. We criticized by our follow traders that you have insufficient experience and you never trade in this market. Fine, when I asked them can they earn points here, they said the trend is not clear so they don't like to enter. Actually they have also no experience ...that I believe. Then, it is necessary to know whether the stock follow a bullish or bearish trend. After a long observation, I found that Parabolic SAR is the best indicator that showed both long term and short term trend. I make two setup of Parabolic SAR that help me to right entry or exit point with maximum gain.
Watch this chart of Nifty Future FEB
Today's trade of Nifty future is one of this kind as discussed above. The American and Asian market are in bearish zone. The RSI indicator showed it is in OVERBROUGHT ZONE. A trader if enter into a short trade in opening trade ...I think he might incurred loss. But, the chart shows that the trend is bullish. One should not enter into a SHORT TRADE in bullish region. It is better to enter in LONG TRADE ON pullback. Today I enter Long @ 6162 and exit at 6198 with a gain of 36 points on intraday position.

Watch this chart of BHARTIARTL

This chart again another example of fine trade. The stock already in BEARISH ZONE. So, a trader never think to enter into LONG TRADE, even if it gives a pullback. But every pullback gives another SHORT ENTRY position. Today I enter in the SHORT TRADE @286.20 and exit at 282.80 with a gain of Rs.3.40 (more than 1%)

Friends, the market is always favor you and your luck if you follow the right trend. You can earn in the market without the help of any tips provider. You always learn from your faults and never shy if you failed today. Success must knock you door.

Good Night friend.

Happy Trading.

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