Wednesday, 31 August 2016

Nifty Future Preopen 31082016

Yesterday it kept on moving in one direction and in that process broke out a month long narrow range. Now next hurdle for Nifty spot is around 8840-45.  Since it has broken out after a consolidation it should reach the target without much trouble.  Here is the chart of NS.
















For today there is an expectation of range-bound moves and buying at Range Low might be the right way to trade today. Nifty spot may pull back to 8700-8725 to test the BO level and may form a Range Low around that area.  Today being the last trading day of the month, it is possible that it may close around highest point of the day.  Will continue to assess as the prices trade throughout the day and may post an update if time permits today .

Sunday, 28 August 2016

Volume

Today as promised I have made an hour long video on discussing volume with lots of real examples and its usefulness in day trading.  Volume is something which has not been talked much about by ST sir or me in my blog.  At some point in my trading journey I felt the need of using the Volume and this is when I started digging deep about the volume, how to use it for day trading, etc.  I have tried to discuss everything that I know about the use of Volume here in the video.  Just to brief you, there are two ways to look at the volume.  One is on vertical scale and another is on horizontal scale. I use volume on both these scales and look for certain conditions to trade with volume.  I have found it very much beneficial in my trading.  It does wonders.  If we combine volume to our existing usual DP and range trading we get fantastic trade setups where the trades can be initiated with lot of confidence.

















In the above chart, I have inserted volume on both vertical and horizontal scales and to no wonder there were three good reversal trades where the understanding of volume would have helped us a lot in taking those trades, which would have been otherwise impossible to take.

I hope the paid subscribers of video tutorial will benefit from it a lot. This knowledge of volume can be applied to any instrument, any market, even the 24 hours traded market.

My next video is going to be on Pattern Failure.  In last few weeks, there have been lot of occurrences of Pattern Failure on Nifty Future chart which forced me to think about exploring it further.  I once again promise to the subscribers a free access to it as well.

If you are not yet part of this wonderful initiative on continuing education through most effective way, you might be missing a lot, not only the volume video but all the future videos.

Thursday, 25 August 2016

Trading Index Options Can Make You Profitable

I recently received a trade log from a trader friend, asking me to analyze what is going wrong with his trading.  He day traded one lot of Nifty Future the whole month.














This is how I analyzed.  He took around 20 trades in a month, so no over trading or under trading.  He applied proper risk management and adhered to the stop losses.  That is perfectly fine and right way to trade.  Only thing missing was the big profit. Okay, that is fine too because we can always work on that.

Now apart from these, the one thing that stood out was the cost involved in trading. He made the profit of around 30 points at the end of the month but after deducting different taxes per trade the net result was loss.  Then I added another column of taxes involved in option trading and to the pleasant surprise the ultimate result was net profit, imagining he traded the same way Index Options too. I excluded brokerage cost because I felt it is negligible nowadays.

So this is how the day trading Index Options makes the difference in overall profitability. Now multiply it with number of lots that you wish to trade.  I trade 10 lots of Index Options and if the same kind of profit I multiply with 10 lots, this little profit of 30 points can turn into Rs. 18K. In India, it is a big amount as most of young college grads strive for it as a monthly income.

Think about it if you are still trading Futures.  Switching to Option trading might make you profitable if you trade it correct way.

Nifty Future 25082016
















It opened above PDH and traded in a narrow range above it for first half of the day.  It broke down and presented a nice BPB setup to initiate short which moved well and made up for the week where it did not do much.  It was kind of a day where as Motilal Oswal says, you have to "Buy right and sit tight." The Nifty 8600CE which I sold at 60.30 became 0.

Wednesday, 24 August 2016

More on Mentoring Program


Today I feel proud to share with all of you the feedback that I received from Mr. Gururaj after completing the mentoring program.  Click here to read it.  He has done all the right things and set a great example for others who want to pursue the day trading as a career. He has his own blog where he keeps a record of his trades.  Click here for the blog. If you go through his blog carefully, you will appreciate the fact that how wonderfully he has maintained the log of trades.  He has right mindset, patience, discipline, and an eagerness to learn, in short all the makings of becoming a good trader.

Monday, 22 August 2016

Nifty Future 22082016
















It opened within yesterday's range and broke down PDL.  BPB trade was not possible because
it moved a lot after breakout.  After that traded in the range.  Attempted BOF of range high which failed.

Friday, 19 August 2016

Today's Trades 19082016

As discussed in Premarket charts and way to do live video today, prices moved as anticipated.

Trade 1.  Sold 8600CE as per system discussed in Index Options video at 104.5 and covered at 92.5.  Alternatively one could have bought 8700PE at the same time.  It yielded almost same.

Trade 2.  Bought Bank Nifty as marked on the chart.  It fell short of the target and did not yield much. This trade was based on the thinking that BN was showing strength and it gave an opportunity to buy at range low in an up trend.































I hope you all understood the knowledge shared through last few days posts and benefited from it.

How I look at the price action during live trading hours


Here is the small video which I recorded live today and just uploaded it during the market hours. This is to demonstrate how I look at the prices, assess them and position myself for the trades.  If you find this way suitable to you, you may use it as a sort of template to work on that direction, or you may choose your own way to do that provided it is in right direction.  I also posted Premarket charts of Nifty and Bank Nifty in last two days, so with this video now you will be able to correlate those charts better.

Always remember, no matter how hard we try to do it properly, markets will always give us surprises. It will require developing an ability to constantly adapt to those surprises and align our thought process to those surprises, and this ability is what makes the difference between a good trader and not so good trader.

I have tried to include not only this, but each and every way I know to assess the price action and how to benefit from it in my Video Tutorial with such examples. It is an attempt towards providing quality education on successful day trading.

Click Here for Video

Thursday, 18 August 2016

Nifty Future 18082016
















As discussed on Premarket chart, it seemed stuck into the range between BRNs and that range did hold today.  Only tradable setup was as marked.

Bank Nifty Future 18082016
















Today traded only in Bank Nifty.  As per the chart posted of Premarket, it broke out of its recent high and there was also good BPB of PDH.  It was like chart shouting out loud to take the position. Initial SL was around 30 points and could ride it out maximum as it was turning out to be a Type 1 trend day and booked at little less than 200 points profit.

Once we acquire the ability to read the prices well, we will be able to trade any market, any instrument in the world.  There are no short-cuts.  Either you gain this ability from others' experience and knowledge or acquire on your own.

Premarket Nifty 18082016
















Assessing the Big Picture in brief, there are two ranges at play as marked on the chart.  Recent range has become narrower.  We will have to trade this range today if prices react there. If price action permits, sell around 8700 and buy around 8600.  That is the final assessment.

Day trading is not only trading at DPs.  All this exercise requires.

Tuesday, 16 August 2016

Nifty 8600CE 16082016

As discussed in Option Trading Video Tutorial, today there was a first trade opportunity on Pressure Play setup.  Current month 8600 call option was bought at 93 and booked at 113 (at 20% of profit).  There was another setup in the noon time when Nifty Future broke down below 8650 but it moved very wildly and did not allow us to trade.


Sunday, 14 August 2016

Make 30% In A Day, Every Day

Make 30% or more in a day by trading Index Options
or let me say,
Grow the trading capital by 4 times in a month

Is it really possible?

Yes, very much.  It is 100% possible and we can trade to make this much money in a day if we are sure about the direction of prices and momentum.  Options are highly leveraged instruments to trade and we can benefit from this leverage keeping the risk at tolerable level. In Gujarati it is said, 5 ka 50000 and lakh ka 12000.  Both are possible in trading options.  5000 can become 50000 and 1 lakh can become 12000.  But our aim here is towards 5 ka 50000.

Now, how to trade Nifty Options and earn 30% or more return in a day?

Okay.  Let me answer this.  As I said, we will achieve this goal by trying to predict the directional move with momentum, which is about to happen.  Type 1 trend days or other days where we can have a sizable move in one direction in a very short period of time are the prefect days to trade with the Nifty Options and use the leverage.  There are certain tools that we can use to predict this kind of momentous directional move with some sort of certainty.  At the end of the day or before the market open, we just to need to use these tools or pointers and see whether there is likelihood of the current day being the Type 1 day or not.  If not Type 1 day then at least a sizable move of around 40 Nifty points in one direction.

I have made a video tutorial demonstrating how to predict successfully this kind of day well in advance and benefit from it.  Even if we are proven correct 50% of the time (in worst case), we will achieve the goal. My experience suggests that with this set of tools, we will be proven correct at least 80% of the time.

Now let me quote 3 recent examples from last week where we could have traded with Nifty Options using this knowledge and made lot of money.  These are from 5th, 9th, and 12th August 2016.  These days one could have made killing into the markets trading Options, and I am sure if you had this knowledge, you would have done the same.

For 5th August, click here

On 9th August we knew with some sort of certainly that prices were likely to go down and with that information one could have bought in-the-money put option.  Same way, on 12th August prices were going to go up and buying in-the-money call option was the right choice to make. In both cases, we are able to book out at around 30% of profit.




Now, lets say you have around 50K in your trading account and you try to trade with Nifty & Bank Nifty Options only on these selective days.  Nowadays brokers allow to buy Options at half a cost under MIS option.  So with 50K you can buy around 12 lots.  The risk is limited to maximum 5 points per lot. So with 12 lots, your risk is 60 points in total and profit potential is 350 to 400 points per trade.  The profits are really very huge.

Last week, we were lucky and we had 3 such days, but usually we will have this kind of days at least 4 to 5 in a month and if we use Nifty and Bank Nifty options both we can get around 10 such trading opportunities in a month.  So if we are able to utilize these trading opportunities we will be able to grow our account 3 to 4 times in a month.  Isn't it amazing?

This option trading strategy on only selective days like this will benefit not only the day traders, but all those who are working full time but still want to trade and make money.  All those need to spend just 10 minutes in the evening at EOD or early morning and if the odds are high for trading options, they can call their broker, place the order and cover it off around 3 to 3:15 pm. No need to track the markets or watch charts.  As I discussed in my last post, we just need to stick to the favorites in order to be successful.  We don't need to be jack of all trades and master of none.

As a bonus I have also included in this video tutorial a specially designed strategy to trade options on expiry days.  There are total 5 expiry days in a month, 1 for Nifty and 4 for Bank Nifty.  So by combing these both strategies, we will have trading opportunities almost every day of the month (5 + 10).

Subscribe to this fantastic Nifty & Bank Nifty Option Trading Video Tutorial.

Mail me at charttechnicals@gmail.com with the subject line of Nifty & Bank Nifty Option Trading Video Tutorial mentioning your preferred way of payment (credit card, debit card or net banking) and get immediate access.

Happy Trading Options!

Saturday, 13 August 2016

Stick to your favorites

Lets say you are too much hungry and you have a thali in front of you full of different dishes.  What would you do now?  Would you eat what you like most or would you like to eat everything in the thali?



Similarly, lets say you are a trader, hungry for making lot of money and looking for setups.  What would you do?  Would you look for your favorite setup to trade or try to trade whatever the market offers you?


Understand, the food in the thali is meant for your hunger.  It is just there to feed you.  It does not matter which dish you eat more or less.  If you try to eat everything, you may not be able to digest it well and get sick.  Similarly, if you try to trade each and every setup it won't be good for your financial health.  You try a dish, it tastes good and you have it more.  Same way you can choose your favorite setup to trade, trade it, and as long as it keeps making money for you, you can continue to trade your favorite setup.  You just don't need to worry or bother about other setups or systems.


Thursday, 11 August 2016

Nifty Future 11082016
















It opened at PDC and sold off.  After that made recovery and started going up.  First tradable setup was a BPB of BRN.  It moved some in favor.  The down move was not tradable.  Towards the fag end there was a nice setup to go long, but because of multiple levels, I hesitated and skipped it.

Tuesday, 9 August 2016

Nifty Future 09082016













RBI announcement day.  Waited till the news was out.  After that it gave nice BOF of PDL/PDC and moved well.  Rest of the day it traded in the ranges around BRN which were not tradable.

Friday, 5 August 2016

Reading the Prices

It is the fact that as a price action short-term trader we need to develop the skill of reading the prices, without which we are not going to succeed.  Trading only the patterns is not going to work for sure.

Last few days markets were trading in anticipation of news flow (GST).  Yesterday markets traded after the news was out.  So now today morning this is how I tried to read the price action engaging the other party. 
(open the chart image in new window for enlarged view).













The first clue it gave when it failed to break the intra-day low yesterday indicating sellers were not interested to sell further.  The reason was obvious because the news flow was not favorable to sell. It was the positive news flow.  Today's full gap up and breaking out of last two days high in first candle confirmed all these setting the stage for Type 1 kind of day.

5 out of 6 pointers were in line for Type 1 trend day which I have discussed in my Price Action Reading Video Tutorial

Thursday, 4 August 2016

Nifty Future 04082016













Today I could take only one trade as marked which yielded some.  At the fag end there was a reversal trade possible, but hesitated to take and missed.

I would like to share with all of you a blog of Shashank.  Here is the link,
http://daytradernifty.blogspot.in/
He is a full-time trader and has put in lot of efforts to reach at this stage.