moneypick said:
Dear Traderji,
What is the strategy to pick a stock for Intrady & EOD trading?
Please explain with the help of indicators & charts.
Regards,
(moneypick)
I do not do intra-day trading. I prefer positional trades where the holding period can be anywhere between weeks to months.
My method of selecting stocks to trade in are different. I do not use any technical indicators. I visually scan through the bar charts every day/week for consolidation/congestion patterns and trade breakouts of those patterns.
Here is an anatomy of my recent trade!
If you look at the attached daily chart of the NSE Nifty below you will notice that the Nifty after retracing 50% of this previous fall went into a period of consolidation for about 2 weeks. Since the underlying trend was bearish all I did was to put in a sell stop order 10 points below the low of 3056.00.
As we all know the market triggered the sell stop order on the 17th and I was short on the Nifty. Once short in the trade I put in a trailing stop order at the previous 3 bar high. I also always make sure that the difference between my entry price and stop loss level multiplied by the number of contracts does not exceed 1% of my trading capital.
Once in a trade I keep adding more positions (as soon as the current stoploss reaches break even level) in the direction of the profitable trend.