Mini Nifty Intraday - The Redline strategy

[AW10]

AW10 , is there any ebooks for reading on the Gap closure setup ?

Don't remember any such single source but google on it and you might find something on it. There are many strategies around gap trading is this is one of them.

Happy Trading

 

[trader.trends]

Trading rules as understood by me :

01. RED LINE is simply previous days Close!!!
02. Go long or short at 0.1% above or below the Red Lines Level. Say Previous days close was at 5000 so we have the following for present days trades :

Enter Long above 5000+0.1%=5005
Entry SL at 5000 less 0.2% = 4990
Exit 40% at 5005+20=5025 SL remains at 4990
Exit 20% at 5005+40=5045 SL moved to 5025
Exit 20% at 5005+60=5065 SL remains at 5025
Exit 20% at close or SL


Enter Short Below 5000 less 0.1% = 4995
Entry SL at 5000+0.2%=5010
Exit 40% at 4995 less 20=4975 SL remains at 5010
Exit 20% at 4995 less 40=4955 SL moved to 4975
Exit 20% at 4995 less 60=4935 SL remains at 4975
Exit 20% at close or SL

Dear Karnani
When I re-read your post, I found this difference. The initial SL is at .2% from your entry level not from the Red line.
Hence if Red line value is 5000
Long Entry : 5005
Initial Stops for longs 4995
Short Entry 4995
Initial stops for short entry: 5005

The initial SL is the filter level on either side and becomes the SAR.

 

[sibumajumdar]

Dear Karnani
When I re-read your post, I found this difference. The initial SL is at .2% from your entry level not from the Red line.
Hence if Red line value is 5000
Long Entry : 5005
Initial Stops for longs 4995
Short Entry 4995
Initial stops for short entry: 5005

The initial SL is the filter level on either side and becomes the SAR.

Dear TT, Before my observation put upto U, I got the clarification. Thanks for the same. Iam a small trader & presently following Mr Savant's Ch-II. But being a full time trader some times i venture in MINIFTY. Can i follow ur RD strategy for day trading with 1 or max 2 lots? Plz help me with your suggestions. Thanks again....SLM

 

[trader.trends]

Dear TT, Before my observation put upto U, I got the clarification. Thanks for the same. Iam a small trader & presently following Mr Savant's Ch-II. But being a full time trader some times i venture in MINIFTY. Can i follow ur RD strategy for day trading with 1 or max 2 lots? Plz help me with your suggestions. Thanks again....SLM

Dear sibumajumdar

I really do not know the efficacy of this strategy. I have not traded it with real money. I will only paper trade it for now. Let us see if it yields us good results and how it can be refined by contributions from others. Once it yields a positive expectancy, we can commit some money to it. What is the hurry? The markets are there for ever. Pl follow the tested strategies of Savant, AW10, Pride, and others for now.
Paper trading has its limitations. We are not including fear and greed here. But if it works on paper it has a chance in real markets, if it does not work on paper, it is "dead on arrival" as doctors will say.

 

[kkr555]

The paper trades from 6 October from my diary:

Date: 16 October (5144 5144 5067 5143)
Red line value = 5109

Nf opened just at the Red line and went down. It again crossed the Red line from beneath and never came below the Red line again.

Trades: No trade possible on the down leg. On the up leg, Bought 5MNF at 5014 sold 2 lots at 5034(40 pts). The day's high remained at 5144. It was at 5143 at 3:27(87 pts) Total 127 pts Profits: 2540/-
Cumulative: Record days: 8 red line days: 5 Trades: 6 Points: 833 Profits: 16660/-

Correct me if I am wrong here. How do you say that there was No trade possible on the down leg. Shouldn't we be SHORTING at 5103.90 only to have our Stop Losses triggered at 5114. (Day's low was 5093) ? i.e., a NET LOSS of 50 points.

 

[trader.trends]

Correct me if I am wrong here. How do you say that there was No trade possible on the down leg. Shouldn't we be SHORTING at 5103.90 only to have our Stop Losses triggered at 5114. (Day's low was 5093) ? i.e., a NET LOSS of 50 points.

Dear kkr
Initially I had thought of making an entry only when the Red line is broken. Hence on the day you mention NF opened flat and went down, not crossing down from the top, hence no shorts initiated. Now AW10 has suggested that we should be alert at the Red line and make an entry in either direction even if the RL is not crossed. In his example he has quoted the day where NF opened higher broke the RL but did not trigger the shorts but went up again. A long could have been initiated there which I had missed.
Now I will be initiating an entry whenever NF comes near the RL and takes out the first filter.
TT

 

[munde_77]

.

the paper trades from 6 october from my diary:

Date: 6 october (5030 5046 4918 5039)
record day 1.
Red line day 1.
red line value = 5008

nf breached (5008) and went to 4918 and again crossed 5008 to close at 5039 30 points above previous close.
Max moves: +90(downside) +30(upside) after breaching redline.
Short at 5003(5mnf) sl 5013
book 2 lots at 4983.(40 pts) book one lot at 4963.(40 pts) book one lot at 4943.(60 pts) stops for the last lot at 4983 taken out.(20 pts)
profit on down leg 160 points=3200/-
nf moved above the red line triggering buy at 5013 and sl at 5003.
Two lots booked at 5033(40 points). Market at 5035 at 3:27. Exit 3 lots at 5035(66 points). Total on up leg: 106 ponts.
Total for the day: Two trades: 266 points, rs. 5320/-

date: 7 october (5070 5080 4964 4974)
record day 2.
Red line day 2.
red line value = 5039

nf breached 5039 @ 12:16 and went to 4982 and recovered but could not cross red line again just touched it and went down again to close at 4974 after touching a low of 4964.
Max moves: Downside 75 upside nil after breach of red line.

Trade:
Short at 5034(5mnf) cover 2 lots at 5014(40 pts), 1 lot at 4984(40 pts), 2 lot at 5014(40 pts), stops taken out
total pts for the day: 120 pts, rs. 2400/-

cumulative
trade days: 2 red line days: 2 points: 386, profit: 7720/-

date: 8 october (4999 5052 4972 5001)
red line value = 4974

nf opened above the red line and traded the whole day above it. It breached the red line once in a spike and went to 4972 just two points below red line thus not triggering the shorts at 4969.
Trade:
No trades triggered
cumulative
trade days: 3 red line days: 2 points: 386 profits: 7720/-

date: 9 october (5020 5027 4923 4931)
red line value = 5001

nf opened higher and breached the redline@10:04 and ended at 4931 without ever crossing the red line again.
Trade: Short 5mnf @ 4996 book 2 lots @4976(40 ps), 1 lot at 4956(40 pts), 1 lot at 4936(60 pts) and the last lot at 4936.(60 pts)
total pts for the day: 200 pts, rs. 4000/-
cumulative
trade days: 4 red line days: 3 points: 586 profits: 11720/-

date: 12 october (4942 5075 4937 5059)
red line value = 4931
nf opened above the red line and traded all day above the red line
trades: No trade day
cumulative: Record days: 5 red line days: 3, points: 586, profits: 11720/-

date: 14 october (5087 5129 5087 5114)
red line value = 5059
nf opened above red line and traded all day above the red line.
Trades: No trade day
cumulative: Record days: 6 red line days: 3 points: 586 profits: 11720/-

date: 15 october (5144 5144 5067 5109)
red line value = 5114
nf opened higher and breached the red line @ 10:23 it hit a low of 5068@ 13:33 and then bounced back to a high of 5120 before closing at 5112. Please note that the close in the narration and the adjusted close taking the last half hour volatility may be different on some days.

Trades: Short at 5109 (5mnf) cover 2 lots at 5089 (40 pts), 1 lot at 5069(40 pts), balance 2 lots stopped at 5089(40 pts) total points: 120 profits: 2400/-
cumulative: Record days: 7 red line days: 4 trades: 5, points: 706 profits: 14120/-

date: 16 october (5144 5144 5067 5143)
red line value = 5109

nf opened just at the red line and went down. It again crossed the red line from beneath and never came below the red line again.

Trades: No trade possible on the down leg. On the up leg, bought 5mnf at 5014 sold 2 lots at 5034(40 pts). The day's high remained at 5144. It was at 5143 at 3:27(87 pts) total 127 pts profits: 2540/-
cumulative: Record days: 8 red line days: 5 trades: 6 points: 833 profits: 16660/-

date: 17 october
red line value 5143
nf opened flat and went down and stayed below red line for the complete time of special trading.
Trades: No trade day
cumulative: Cumulative: Record days: 8 red line days: 5 trades: 6 points: 833 profits: 16660/-

please note that since i have posted trades since 6 october in one shot, i could have committed errors in postings. They will be rectified if pointed out. In the olhc figures mentioned in front of each day, the closing figures may not match with the closing figures mentioned in the narration due to adjustments by exchange in the final closing figures. These are not real trades but paper trades hence follow the strategy after due diligence.

 

[balaj78]

Hi,
Redline value is the previous closing value and

red line value = 5008
Date: 6 october (5030 5046 4918 5039) .what are these values

 

[trader.trends]

Hi,
Redline value is the previous closing value and

red line value = 5008
Date: 6 october (5030 5046 4918 5039) .what are these values

Those are the open, high. low close for the day. It is mentioned there for easy reference.
TT

 

[AW10]

Those are the open, high. low close for the day. It is mentioned there for easy reference.
TT

TT, a suggestion.. if you find that there are questions on your Core posts (i.e. first few important posts), then plz update them to clarify the doubt..
As owner of this thread, u don't want to answer same question again and again.. rather remove the ambiguity from the core posts.

In short, if you can write there that value is bracket is OHLC of the day.. it would improve the posts.

Happy Trading