From My Trading system: 1-3 Day Trades

[abcpankaj]

Hi Arvind,

Have you run a Backtest on your system with amibroker , metastock or any other trading software.
May be it can be backtested in the same (c , c++ or whatever language you are using )program , which you use for analysis.
I would highly recommend that ,if you haven't done that already.

Regards

First I would like to request people who are accessing my information about giving feedback of their experiences. Kindly share your god/bad experience and also state what else you would like to see.

NIFTY has hit the last low fractal formed 2 day after budget day today and can go down 100 points in a jiffy. Reliance should lead as today it has hit the new low should it break 200 day DMA 206.

Some tech. and pharma companies have shown weakness and joined the downstream.

Short Hexaware 88-88.4 stop 90
short TechMahindra 1070-1078 stop 1095
short DRReddy 1790 -1800 stop 1812
short Exide 126-127 stop 130

Good luck ..:thumb:

 

[arvind61]

Pankaj

Thanks for your message.

My system has NSE EOD data since May 1 2007. I do back test my algorithms. Nature of market changes from time to time. My approach is not indicator based and neither it runs same set of algorithms for every stock. Only common theme one can say is mostly going with the trend. Though occasionally I do have counter trend trades.

arvind

 

[arvind61]

Dear DSM

One very valid point you made was not to mention too many trades. I clearly remember few years back (may be 2003-04) I had taken monthly trading subscription from one eminent Analyst who used to frequent CNBC starting the name with letter P.. for 6 months. I thought he was quite good at quite an expensive rate. He would sent a letter in the evening mentioning some 30-40 trading calls on as many stock predicting a move of 1 % to 3 %.

Next day would be lost totally to figure out which stock to track and when. It was such a bad experience. Some of his calls would be proven true at the end of the day but it was more because he made so many of these calls. But I could hardly ever catch and time them. It was such a bad experience. But since to get discount I had purchased 6 months plan I was stuck with it. After 3 month I even stopped looking at his mail. So I never mention more than 5-6 trades in my recommendation. It was really worthless investment for me.

When I mention some set ups like 'gaps' or "Shrinking Range Days' or some delivery stats etc then I mention all of them because they are not my recommendations. I know some people are looking for these set ups and they get help to locate these.

arvind

 

[arvind61]

NIFTY bounced from the low of 5605 and closed above 200 day DMA 5627. We are in a lower top lower bottom cycle in NIFTY in daily charts. I am sure there will be a retest of these lows in next 10 days. Only if we close above 20-50 day averages and make a higher bottom then there would be some cheer from NIFTY side.


Don't see too many trades in the direction of the trend.

Short CIPLA around 382-383 stop of 386. Could not close above 20 day DMA in last 2 days and now EMA and DMA are converging around 382-383 should be strong resistance.

Buy WIPRO at about 435-436 with stop of 430. Need to close above 443 for bigger gains.

One counter trend trade I am willing to gamble tomorrow is JPPower - which has given bullish engulfing pattern with huge volumes -

Shall buy on dip between 25.5 -26 with a close stop of 25

good luck ..

 

[timepass]

Wipro and Siemens are going out of Nifty from tomorrow.

 

[arvind61]

Thanks to 'timepass' for the cautioning against getting long into WIPRO. Even CIPLA was on tear today. Choosing to bounce down from 50 day DMA and not 20. NIFTY has traded in a narrow range today..I think it has made NR7 as some are looking for the pattern.

Here are some ideas for tomorrow -

Short tatapower on rise to 97-97.8 stop 100
short Coal India 309.5-310 stop 313
short NMDC 137.5-138.5 stop 141
short ONGC 311-313 stop 316

there are no convincing counter trend ideas on long side . May be DLF tries to hit its 20 day dma about 260.

good luck..

 

[arvind61]

Today was a stop loss trigger day. Got into shorting ONGC future around 314 it just rocketed in the afternoon. Got out at about 317 when stock breached yesterdays high in cash.

It becomes tough to follow other stock when you have one position already running. I had a strong feeling WIPRO would zoom past 443 the last daily top but just could not track it. Should have a team to monitor stocks of interests.

It was not a good day to short in the hindsight. As NIFTY could have gone either way. Should have waited for NIFTY to make its move beyond NR-7 range then taken a position with the direction of NIFTY or stayed aside. Sounds so logical after the event.

NIFTY now is just below 20 Day EMA. 20 Day DMA falls about 5780. That can be some hurdle tomorrow. Shall take any position after some clarity by 1:30 PM.

I have not been able to find a strong and reliable signal for counter trend trades even for intra day. Bullish/Bearish divergent bars, Morning/Evening star, engulfing pattern at around last bottom etc are not showing very high probability. I am researching the shrinking range set up at bottom or top that seem to so some promise. Wonder if any of you is using that.

Ideas for tomorrow --go with the NIFTY direction

long DenaBank 92.5-93 stop 91
long ANDHRABANK 97-97.5 stop 96

One shorting idea is ARVIND below 79 stop 80.5

good luck..

 

[arvind61]

Two consecutive Inside Bar Days on HCLTech near Top. Calm before the storm??

 

[mastermind007]

Two consecutive Inside Bar Days on HCLTech near Top. Calm before the storm??

Yup. Its at wave count 5 too

 

[arvind61]

What does one do when markets get irrational?l Like what happened in last one hour today? Specially if its moving to the direction of your displeasure. There would be some people with nerves of steel who would perhaps be taking advantage of all the panic and mayhem. But mostly these would be professionals who would be playing with other's money. Easier for them.

For average retail person it is best to close all positions and get to sideline ASAP! Because these swings which sometime appear to be in your favour sometimes hit back very violently and what looked like a safe trading position minutes back gets into a nightmare. Unfortunately there is no depth in our market and we are very edgy and ready to explode. One very bad day can make you leave the market for good. So be smart and live another day.

If you have stop losses in place do check whether they worked or not. Believe me it has happened to me. Sometime things fall so quickly that the stop loss trade does not take place.

HCLtech was simmering for two days and was ready to explode. HCLtech operators did try to fool by putting up a bull trap by breaking out of range, but I guess it happened so soon in the day and with so little volume that it must not have fooled many.

We are no longer a safe and study market. Market mood swings from one end to other with clue or without clue . As a Day/Short term trader we should try to divide the day in 3-4 parts . I had read about it but need to put into practice with more discipline.

9:15 AM to 10:30 AM one slot book whatever profit loss based on overnight clues and previous day data.

10:30 -12:30 second slot if you get to re-enter the earlier trades get out before Europe opens. God knows what comes from there.

12:30 -1:30 Check out the new mood of market and prepare for all important afternoon slot

I wonder if any one of you is actually practising it with some discipline. Would love to know about the method.

Nifty was left at the 20 day EMA yesterday. There was always a chance it would consolidate but what happened was a bit surprise.

Trade in small quantities or in options

Here are some ideas for nimble footed -

Short Crompton 94.5-95 Stop 96

long Uniphos 121.5-122 stop 119

short renuka 24-24.5 stop 25.5

long jswsteel 682-683 stop 677


ONGC has formed an inside day at a critical location may be it goes up to test 50 day dma of 320 or if closes below 311 would get weaker for couple of days. ONGC is used to move NIFTY .

HDFC and CUMMINS are showing shring range or 3 days with CUMMINS also an inside day

Good Luck to everyone...


arvind