Profitable Intrady Strategy

Hello , I am a day trader for 5 years , and I found people just struggling to make consistent profits in day trading . They always try to find some magical indicators which can make them the best trader giving them profit after profit but the real truth is there is no such thing I even use technical indicators but not like the people who are continuosly loosing as a day trader . You really need to have a edge in the market than what other people are doing . As a matter of fact you really need 3 things to be a better trader is 1. Proper Mindset 2. Strict Money Management and 3. Method which I will dicuss here .

Here I am discussing one of my strategy -

This strategy consist of three Technical Indicators

1. Super Trend Indicator 7,3

2. Stochastic ( You may use RSI , CCI etc does'nt matter and adjust the setting which suits you best )

3. Average True Range 14 period

You will also need atlest 7 days intraday historical data which is now most broker have in their Trading platform .

The reason for using the Super Trend is that it is a trend fllowing indicator and really gives less false signal in sideways market than other trend following Indicators like SMA , EMA crossover etc.

ATR is used in my strategy for determing stop Loss

BUY SETUP

First Super Trend should be in a bullish mode in 30 Min Chart

Entry should be taken on Stochastis crossover in Oversold teritory on a 5 min chart

Stop Loss should be 1.5 times the value of ATR based on 5min chart

Book Profit when price reaches 3 times the stoploss meaning if your stop loss is Rs 2 book profit when price increases Rs 6 from entry price

SELL SETUP

First Super Trend should be in a bearish mode in 30 Min Chart

Entry should be taken on Stochastis crossover in Overbought teritory on a 5 min chart

Stop Loss should be 1.5 times the value of ATR based on 5min chart

Exit strategy should be opposite the buying one above .


Now , the reason for using supertrend on 30 min chart is that it will give you a clear direction of the overall short term trend which is very very important on day trading

If you dont know the overall trend and just blindly taking signals on 5 min chart you will be in real trouble .

Now comes the Money Management without which you will not be able to make money consistently .

Suppose you have 1 Lac in your trading account . You will not risk more than 2 % on a single day which is Rs 2000 . If you are willing to trade 4 trades in a day then divide the risk by 4 wich is Rs 500 which is I am n going to risk on a single trade . So for example if you entering a trade and you determing the Stoploss is Rs 4 , then I will divide the risk per trade amount which is here Rs 500 by the stoploss which is Rs 4 and the result is 125 which is going to be my position size meaning the number of shares i will be buying and same for shorting .

Meaning you are risking Rs 500 for getting a potential profit of Rs 1500 on each trade
So 4 trades in a day ok .

If 2% of you trading capital which is the daily loss limit is hit which I think is the worst case then stop trading immediately , dont overtrade to make that loss up on that day , come back on the market the next day .

And dont always expect your target to hit by 1:3 risk reward ratio if the market is not trending strongly , sometime you have to settle for 1:2 which I think is not bad.

And try to trade on fixed stocks rather than jumping from one stock to another which will decrease your odds. You can have 2 to 7 stocks in your wachlist and try to trade them on a daily base .
Select stock which have daily range of 3% of its price and the price should be between Rs 500 to Rs 1000 and try to select them form nifty 50

Hi

Thank you for the tips.

Regards

Can you post this Super Trend Indicator afl?

hi
how to set average true range? and stoploss?pl. explain us with an example.In trade tiger i m getting two values ie TR & ATRR.So which value should be 1.5 times?

use the ATRR not TR . If your ATRR reading is 3 on 5 min chart , use Stoploss of 4.5 which is 1.5 times of the ATRR . Use the 14 period which gives enough room for your trade

thanks for sharing !!!:thumb:

Looking forward to your strategy tombstone. Thanks

Thanks Tombstone.
Actually for Commodity ,cash, future,you suggest same settings? I mean time frame, atr etc.
Regards.

Requested the admin/mods to move this thread to "Day Trading" section.

Actually it depends on your trading style , the setting sould be same on all segments but you can alter timeframe acording to your trading style , for example if you are a scalper you can use 5 min chart for identifying the overall trend and use 1 min chart for entry and exit , if you want to take 3 - 4 trades in a day you can use combination of 30 min and 5 min chart , simply if the higher timefrime is bullish you will only take take buying signals of any indicator in lower time frame as the higher timeframe is kind a filter .