MR13 Trading System

amandeep86

Well-Known Member
#1
Hello Friends,

After learning from Traderji and different forums and doing live intraday Trading,i have came across the following conclusion to make money from the market :

1.You need to have a system that suits your profile ,other's system may be a Holygrail for them but will not work for you.

2.I need to stick to a system and stop hopping systems.Discipline and consistency is more important along with Technical System.

3.Major Money is made in Trend Moves ,Thus a system must be able to catch impulse moves .For intraday ,Stop losses must be small so that a good risk reward is achieved.

4.You need to have clear cut ENTRY ,STOP LOSS and EXIT plan well before you enter ,so that no decision is taken after the trade is taken.This helps to reduce trading errors due to Fear and Greed.

Considering above facts in mind ,i have designed an intraday MR13 trading system which i would be sharing in the coming post.

Healthy critics about the system are most welcomed.

I would also request seniors and other fellow traders to review and suggest on how the system can be improved.

This is based on the principal of Price moving towards a Mean Reversion level.Time Frame is 30 Mins .
 
Last edited:

amandeep86

Well-Known Member
#2
Reserved 1
 

amandeep86

Well-Known Member
#3
Reserved 2 for Future Use
 

manishchan

Well-Known Member
#4
Hello Friends,

After learning from Traderji and different forums and doing live intraday Trading,i have came across the following conclusion to make money from the market :

1.You need to have a system that suits your profile ,other's system may be a Holygrail for them but will not work for you.

2.I need to stick to a system and stop hopping systems.Discipline and consistency is more important along with Technical System.

3.Major Money is made in Trend Moves ,Thus a system must be able to catch impulse moves .For intraday ,Stop losses must be small so that a good risk reward is achieved.

4.You need to have clear cut ENTRY ,STOP LOSS and EXIT plan well before you enter ,so that no decision is taken after the trade is taken.This helps to reduce trading errors due to Fear and Greed.


Considering above facts in mind ,i have designed an intraday MR13 trading system which i would be sharing in the coming post.

Healthy critics about the system are most welcomed.

I would also request seniors and other fellow traders to review and suggest on how the system can be improved.

This is based on the principal of Price moving towards a Mean Reversion level.Time Frame is 30 Mins .
Vital points.. very well pointed !! :thumb:

Mean reversion level sounds interesting.. will be looking forward to it. :)
 
#5
Looking forward to some great stuff here....great going Amandeep...

Smart_trade
 

amandeep86

Well-Known Member
#6
Mean Reversion

Mean reversion is simply the idea that over a given period of time, price of an instrument will move back to some mean value. Thus, mean reversion is about looking for markets that have deviated significantly from their average, which will likely return to the average at some point in the future.(Taken From Google)

MR13 System is build around it to Enter Trends .We are using EMA for defining mean reversion level for our Entries.

System is described as Below :-

Time Frame :30 Mins

Mean Reversion Level :13 EMA

Trading Scripts :-Index NF ,BNF , Stocks- Nifty Top 50 stocks

A. Basic Filter for Scrip Selection and Trend Biasness:-

1. Clear Trend in a Script – 13 EMA must be Rising ,If sideways -avoid the Script until there is a clear visual distance between EMA and Price. Sideways scripts can be identified by visual Pivots not rising or falling ,i.e. making Equal Swing Highs or Lows.

2. Only Long Entries – When Price above EMA and Vice versa for Short, No trade when EMA is Flat or Price Oscillating around EMA.

3. No trade on First Crossover of Price to EMA, Remember this is trade setup to trade Pullbacks to Mean Reversion EMA level Only.

B. Entry Setup :

When price comes near to EMA level look for the following Price Action in candles :-
For Buy :-

1. Price close to EMA /Price goes below EMA and rises back/Price takes Rejection or Support at EMA .

2. Read LL as Lower Low and HL as Higher low Below.

Look for 123 Pattern i.e. Candle1 makes LL , Candle 2 also makes LL (wrt to candle 1) and then Candle 3 makes HL (wrt to candle 2 LL) ,Enter on Break of candle 2 high.

Stop Loss :- Candle 2 low ,if SL is more then 1% use SL as Candle 3 low, keeping Candle 3 high is Aggressive Entry stop and offers good Risk Reward Ratio.

For Sell :-

1. Price close to EMA /Price goes above EMA and falls back/Price takes Rejection or Resistance at EMA .

2. Read LH as Lower High and HH as Higher High Below.

Look for 123 Pattern i.e. Candle1 makes HH , Candle 2 also makes HH (wrt to candle 1) and then Candle 3 makes LH (wrt to candle 2 HH) ,Enter on Break of candle 2 low.

Stop Loss :- Candle 2 High ,if SL is more then 1% use SL as Candle 3 high, keeping Candle 3 High is Aggressive Entry stop and offers good Risk Reward Ratio.

Would be discussing Exits and Money management Rules in the next Post.

Looking forward for your suggestions and comments .
 
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amandeep86

Well-Known Member
#8
123 pattern makes me little bit confused.Can you please explain it with a chart? Thanks.
Vasan,

Don't get confused by name ,its pretty simple ,See Chart below ,Pattern in circle is Sell Setup and in Diamond Box is Buy Setup.

We would enter Buy as per system since its a rejection from EMA.

Chart is for ONGC for Today (31.10.14)

 
#10
Also suggest few stocks in which this kind of set up can be seen on daily basis.....otherwise, we will end up waiting for the set up the whole day ...thanks!!
 

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