Dear prasanna
Today (02/03/2015) i tried tata motors with camerilla pivot point calculator.
L3 584 its open price is between l3 and h3 it first hit the l3 price and goes below l3 so i went long buy order @ 584.i expect to hit the target h1 but it didn't. I placed l4 is stoploss @574. It hit stoploss. I lost rs. 5000. So anything wrong with my trade?.
Earlier i trade with gann calculator it gives average results. But it is easy and not great.
Somewhere i read that camerilla method gives 90%sucess rate. So i tried today. This is my first trade with camerilla.
What is your opinion?
Regards
Mmohanar
Dear Mmohanr
Now let me explain. gann and camarilla are two different methods. But you can incorporate them.
Let's take your case of Tata Motors.
The High/low/close for tata motors was 598.95(take 599),563.80(564),and 593.35(593) on 28th Feb. Hence the Camarilla levels come out as below for the day 2nd March
H4 - 612 L1 - 590
H3 - 603 L2 - 587
H2 - 599 L3 - 583
H1 - 596 L4 - 574
Ideally one should go short when the stock goes beyond H3 and then come back to H3, or one should go long when stock goes beyond L3 and then come back to cross L3, which you thought has happened and took the position. Most probably you took the position at around 11 hrs. But what mistake did you commit ??
Here comes the tricky part. Every new trader wants to find a Holy Grail and the theory should match the reality, that's what I also thought when i was a newbie.(Of course i don't know how old are you in the trading arena, please excuse me if I have wrongly felt that you are new to this line). Now coming to the topic, it rarely happens in cricket that one perfect bowler bowls Text book bowling, and the batsman at the other end plays a text book shot. lots of old cricket matches carried such text book bowling and batting. But now people do not have patience and the format changed from Test match to 20-20. So as in trading. No longer people want to buy and hold. If anything is better than bank rate of interest in a day, then take the profit and be tension less. Hence you won't find a text book entry and exit signal. In our mother tongue there is a proverb, it is altogether different to cultivate brinjal practically than to read how to cultivate it. definitely reading the theory about brinjal cultivation will help you, but again you have to make it suitable to your requirements when really cultivating on your land
Now you see what happened. on 28th Feb, the range of Tatamotors was (599-564)=35
On 2nd March it opened @597.40 (a gap from earlier closing of 593.40) and it went upto 601 (close to 603, H3 level). Then it retraced and went down upto 593.25. Now you see the price broke H1 level which was 596. after breaking 596 and going down to 593, it went upto 598.25(
see, it did not cross 599, which was H2 level.) then again it started going down and broke L1 level of 590. then it started rising and went upto 594.60 (
again you can see, it did not cross 596, which was H1 level). then it finally started its downward journey and took rest at 573. So you took position in the downtrend, by that time the price had already down from 601, i.e. almost 50% range of 28th feb range of RS 35/-.
now see Gann. if you feed 595 in the gann table it will show the following figures.
First price broke 600, then came down to crack 594>588>582>576>570 which is in line with Camarilla. How? Just compare the levels, there is only 1 or 2 rs diff.
What you should have done.
You should have gone short at 596 or better when it retraced to 598, but sometime price don't get back, hence it is better to take at the level. Your stoploss at that time should have been 602. Then when it broke 590, your stop loss should have been 596, (better to book 50% profit), Then when it broke 587, your Stop loss should have been 591,and so on.
See after touching 573, it started rising and crossed 583 then it almost touched 587.
So Mmohanr bhai, I think I have bored you enough with my Gyan. If you can make little profit thro my small knowledge i will be happy.
Thanks
Happy trading
Prasanna
