This is an effort to find out a new trading method, to get a safe trade for the common man who doesn’t have any charting software or any other tools day trading in nifty. We expect that this method can give a decent return in a single trade ( at least 20 points).
We are predicting a trading zone with upper (High) and lower (Low) boundary for the day, within which we will be trading. The method is still under observation.
Method to trade :
1) Enter the trade only if NIFTY enter the above trading zone either from upper side or from lower side whichever comes first once the market opens. There will be no trade if nifty doesn’t enter our trading zone
2) All the level mentioned here are for SPOT NIFTY ( adjust your levels accordingly for F&O trade)
3) If the open is below the LOWER BOUNDARY, and cross it and move upwards, or the open is just above the LOWER BOUNDARY, move downward , touch the LOW level and move upwards, then BUY
4) If the open is above the HIGHER BOUNDARY, and breach it and move downwards or open is just below the HIGH move upward, touch the HIGHER BOUNDARY and move downwards, then SELL
5) Entry to be made whichever the case comes first once the market opens
6) In either case, the STOP LOSS will be 13 points from the trading zone boundary
7) If the stop loss is hit, then there will not be any other trade for the day
8) This method is applicable only for the first trade of any day (whichever the case come first).
9) Profit booking can be made once you get 20 to 25 points, or else a trailing stop loss may be put to protect at least 12 points profit and wait for higher levels.
10) Any trade which gives 20 points or more will be considered as “successful trade” and any profit below 20 points will be considered as “partial success trade”.
11) Stop Loss hit trades will be considered as “failed trades”
This is not a trading call to anyone. This post is purely for observatory purpose.
Summary of Trades for last one month from 22/11/2011 to 25/01/2012
Now it is two months, we have been observing this method. It is time to summarise what happened with this method in the last two months.
Total trading zone Predictions = 38
Total Trades initiated = 27 (11 days, nifty didn’t enter our trading zone )
Total successful trade = 20
Success % = 74.07
Partial success trades = 2
Partial Success % = 7.41
Total success % = 81.48
Total points gained ( net ) = 583
Assuming that 1 lot is traded, then the
Profit amount Rs. = 583 x 50 = 29150.00
With 2 lots traded, profit Rs. = 58300.00
This profit points are based on the method of only one trade per day.
As we noticed, on stop loss hit days and on simple 20+ points profit days, there were many days where we had a chance for a second trade which would have given approximately 40+ points per trade.
In such cases the profit point would have been more than 583+ points.
Thank you all whoever has observed this method keenly. I need some time to analyse and to see whether there is any scope for improvement in this method. If I could find something to improve this method, I will make those changes to this method and post it. Otherwise same old method will continue.
RESULTS OF NIFTY trading zone predictions for today - 20/01/2012 :
Prediction of NIFTY trading zone for today was : HIGH= 5067 LOW= 4994
Actual range of NIFTY today was
1). There is no trade today as per this method , as Nifty didn’t enter our trading zone boundary throughout the day. We missed the trade narrowly, as nifty came almost near to our boundary line but didn’t touch the boundary.
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