My Journey In Technical Analysis

[VJAY]

Psychological drill which i have adopted:

Psychological drill is nothing but routine which a successful trader should follow for flaw less execution of his plan ,to keep attached to system and for get riding system hopping thought process .it is not much useful for newbie and struggling traders as they need to learn lot on system, risk management and position sizing still in learning phase to develop a system.

i'm not a coder, nor interested in algo so followed below routine points,which have worked for me,it is not universal proof ,just pinning general points to keep it simple.

1. Study your system rules daily before market start,never ever violate this routine to bring focus and calmness in mind.

2. To keep phase always start small ,stop watching MTM screens ,this helps in get riding of result oriented mind set ,thought process should be to the follow the plan rather then dreaming results, practice this for at least one quarter ,later move to original qty, after you notice flawless execution, i have done this for 6 month, to 1 year..basing on intra /swing /positional

3. Never watch trade log of other traders ,which are available in social media,just to keep in mind that its a fallacy , every system is different and results will be different ,what matters is your system and position sizing,execution

4. Matrix of system is reality it is part and parcel, you cannot runaway from it ,don’t try for magical movement.

5. Get out of social media particularly of traders account /forum for a month , if needed for more months to adopt flaw less execution and follow through, later come back to test your thought process.if you notice you are still running after any new system or change of ideas after watching trade log/,posts. repeat above process once again 1 to 4. after all we need soldier mind set for success

Great post.....

 

[P_A_R_K]

I have seen many successful traders (they are not members in this forum)..who use market structure for trading for intraday...with 1:3 and 1:4 R:R..They take margins from Broker also and manage it with tremendous success..
But i also trade market structure ..but will go with ideal bookish knowledge of 1 to 2 % risk per trade !!!...Reason i cannot spot best setup ...

Main advantage of some of my friends is there ability to spot BOF (Break out failure) at earlier stage...this is there lethal weapon ..target is fixed with tremendous success rate .....

i too have some of the setups with good R:R,but only in positional trading which are not a repetitive almost rare ...:annoyed:

Bottomline:

Every successful trader trades with 1 to 2 % risk per trade on capital is a myth..person with best R:R and strike rate can move with margin..

With out this quality ..one must only use 1 to 2 % per capital never run with margin trading

Even with success they suffer emotionally many times with margin..when market turns choppy..which i don't have ..thanks to MM guru's

One more thing which i come across leverage used only when they making means risking floating equity to increase not straight away jump in 2x 3x 4x gradually adding up brother

 

[XRAY27]

Extended moves in high VIX area is common ,neither it good for traders nor investors, for option sellers it is worst nightmare..it can remain in that period for 2 years also.. (vix below 20 its a bench mark in general) i'm countering with 2 systems in intraday with full deployment . swing cannot be traded (Moves are filled with Black swans)..thrust is on full deployment, which is achieved. Trading is not all cry baby we need application to given situation.

 

[XRAY27]

In words of W. Edwards Deming:

1. In God we trust, for the rest, bring data,

2. With out data you're just another person with opinion

My observation of index (nifty and bank nifty) by stats

Bank nifty spot done 50 % fall from peak and nifty spot 50 % is at 6215 ..if this figure in not done , this market will rebound to ATH with in 2 to 3 years..if this 6215 is seen om nifty then we must prepare for 8 years ..,baba bank nifty will feel pressure ,off course news like NPA,big defaults can be rated as black swans.

A fall of 50 % and more from peak in index in my observation different type of retail participants will be like this:

1. Intra traders ROI will dip to very low ,as ISL will be high as usual position sizing kicks in

2. Quant model based investors, will park there cash in bank waiting for deployment

3. ADI,swing traders will feel the pressure

Playing in High VIX environment ,position sizing is key , as initial entry risk increases considerably .naturally ROI decreases

 

[Mavala]

In words of W. Edwards Deming:

1. In God we trust, for the rest, bring data,

2. With out data you're just another person with opinion

My observation of index (nifty and bank nifty) by stats

Bank nifty spot done 50 % fall from peak and nifty spot 50 % is at 6215 ..if this figure in not done , this market will rebound to ATH with in 2 to 3 years..if this 6215 is seen om nifty then we must prepare for 8 years ..,baba bank nifty will feel pressure ,off course news like NPA,big defaults can be rated as black swans.

A fall of 50 % and more from peak in index in my observation different type of retail participants will be like this:

1. Intra traders ROI will dip to very low ,as ISL will be high as usual position sizing kicks in

2. Quant model based investors, will park there cash in bank waiting for deployment

3. ADI,swing traders will feel the pressure

Playing in High VIX environment ,position sizing is key , as initial entry risk increases considerably .naturally ROI decreases

I am not able to fully understand why high volatility should affect ROI of intraday traders. Let me give a example. I trade 15 minutes TF and my position sizing is based on ATR of 15 minutes. Couple of months back ATR was around 25 points , and I could trade let us say 600 quantity for 15 L capital assuming 1% risk.In current scenario, till last week ATR was around 100 points and I could trade only 150 quantity for same capital. These days nifty movement of 300- 400 points is normal and R:R is same as before when nifty used to move 100 points with low ATR of 25. The only point I am making is as long as R:R is same, ROI should never suffer irrespective of volatility .Enligten me if I am missing something.

In words of W. Edwards Deming:

1. In God we trust, for the rest, bring data,

2. With out data you're just another person with opinion

My observation of index (nifty and bank nifty) by stats

Bank nifty spot done 50 % fall from peak and nifty spot 50 % is at 6215 ..if this figure in not done , this market will rebound to ATH with in 2 to 3 years..if this 6215 is seen om nifty then we must prepare for 8 years ..,baba bank nifty will feel pressure ,off course news like NPA,big defaults can be rated as black swans.

A fall of 50 % and more from peak in index in my observation different type of retail participants will be like this:

1. Intra traders ROI will dip to very low ,as ISL will be high as usual position sizing kicks in

2. Quant model based investors, will park there cash in bank waiting for deployment

3. ADI,swing traders will feel the pressure

Playing in High VIX environment ,position sizing is key , as initial entry risk increases considerably .naturally ROI decreases

I am not able to fully understand why high volatility should affect ROI of intraday traders. Let me give a example. I trade 15 minutes TF and my position sizing is based on ATR of 15 minutes. Couple of months back ATR was around 25 points , and I could trade let us say 600 quantity for 15 L capital assuming 1% risk.In current scenario, till last week ATR was around 100 points and I could trade only 150 quantity for same capital. These days nifty movement of 300- 400 points is normal and R:R is same as before when nifty used to move 100 points with low ATR of 25. The only point I am making is as long as R:R is same, ROI should never suffer irrespective of volatility .Enligten me if I am missing something.

 

[TracerBullet]

Do you expect VIX to remain extreme for an extended period ? Once vix reduces somewhat, ROI should go back towards normal levels i think. Even now, volatility has began to reduce. We had around 5 nr7 days in last 7-8 days in Nifty Futures which might indicate atleast some reduction in vol.

And within that we had a nice trending period last two days. As long as vol is somewhat predictable with contraction and expansion i think my systems should be ok. After flatish returns recently they are starting to improve again. As long as position sizing and stops respect vol, then there should not be as much of an issue, just normal ups and downs. If VIX remains extreme then it might be tougher ... Trading itself gets tough as index circuits cause lots of complications

 

[XRAY27]

I am not able to fully understand why high volatility should affect ROI of intraday traders. Let me give a example. I trade 15 minutes TF and my position sizing is based on ATR of 15 minutes. Couple of months back ATR was around 25 points , and I could trade let us say 600 quantity for 15 L capital assuming 1% risk.In current scenario, till last week ATR was around 100 points and I could trade only 150 quantity for same capital. These days nifty movement of 300- 400 points is normal and R:R is same as before when nifty used to move 100 points with low ATR of 25. The only point I am making is as long as R:R is same, ROI should never suffer irrespective of volatility .Enligten me if I am missing something.

I am not able to fully understand why high volatility should affect ROI of intraday traders. Let me give a example. I trade 15 minutes TF and my position sizing is based on ATR of 15 minutes. Couple of months back ATR was around 25 points , and I could trade let us say 600 quantity for 15 L capital assuming 1% risk.In current scenario, till last week ATR was around 100 points and I could trade only 150 quantity for same capital. These days nifty movement of 300- 400 points is normal and R:R is same as before when nifty used to move 100 points with low ATR of 25. The only point I am making is as long as R:R is same, ROI should never suffer irrespective of volatility .Enligten me if I am missing something.

Your question contains answers, learn proper use of ATR and its limitation ,high VIX increase ISL and slippage ,increase of margins..ultimately ROI is effected to negative side !!

 

[XRAY27]

Do you expect VIX to remain extreme for an extended period ? Once vix reduces somewhat, ROI should go back towards normal levels i think. Even now, volatility has began to reduce. We had around 5 nr7 days in last 7-8 days in Nifty Futures which might indicate atleast some reduction in vol.

And within that we had a nice trending period last two days. As long as vol is somewhat predictable with contraction and expansion i think my systems should be ok. After flatish returns recently they are starting to improve again. As long as position sizing and stops respect vol, then there should not be as much of an issue, just normal ups and downs. If VIX remains extreme then it might be tougher ... Trading itself gets tough as index circuits cause lots of complications

Check previous VIX movement (2008) before you can say VIX will not remain for extended period..!!

https://in.investing.com/indices/india-vix-historical-data?end_date=1270405800&st_date=1173119400

trader needs to trade 30 to 50 levels ,without thinking of VIX below 20 , how to balance this ,i 'm going with 2 intra systems for full deployment..one same old MP based another is event pattern mechanism with respective to bank nifty fut.,swing cannot trade as if now ,impending slippages will increase,volume squeeze another factor,black swan props ups

 

[VJAY]

If one using money management (risk /trade) it will look the volatility things automaticly ...yes volatility period initial stop loss and slippages are always high

 

[TracerBullet]

Check previous VIX movement (2008) before you can say VIX will not remain for extended period..!!

https://in.investing.com/indices/india-vix-historical-data?end_date=1270405800&st_date=1173119400

trader needs to trade 30 to 50 levels ,without thinking of VIX below 20 , how to balance this ,i 'm going with 2 intra systems for full deployment..one same old MP based another is event pattern mechanism with respective to bank nifty fut.,swing cannot trade as if now ,impending slippages will increase,volume squeeze another factor,black swan props ups

Yeah looking at that chart, we had spikes for almost a year it seems with more normal vol in between.

Although, realized vol got back to normal much more quickly after oct 2008 and that's more interesting to me. I dont have data for stocks in that period so dont really know system performance then but as long as we dont hit index circuit levels every other day it probably should be fine. I only have intraday systems for now and there was no issue last month.

One good thing is that as size goes down so does expense and slippages compared to my initial risk. So would be nice if we get elevated but not out of control volatility. Lets see, interesting times ...