For NF day traders if we are in trade and in profit at 15:00 hrs, we wonder if we should close trades at the close of 15:00hrs bar or hold it till EOD. Even if we want to we may not be able to do it since auto close kicks in with most broker by then or if we are on leveraged trades which do not permit carrying it till EOD. The one alternative is to close the future position and open a options position or cut the position size partially at 15:00 hrs and carry the balance to squeeze out some more juice. Traders looking at VWAP and trading the difference between VWAP and the CMP may also be in this dilemma if the difference is huge and they are expecting the trend to run on the last bar too. But what should be the SL for such trades? We are already in profit and do not wish to give up much of it if there is a treacherous reversal on the last bar.
Looking back at the last bar (15:00 to 15:30) over a period of time, I found that the last bar goes less than seven points in the direction opp to the trend on most of such trending days most times (Double qualifiers for caution!). Say NF has been trending fifty points or more for the last couple of bars prior to the last bar, then keeping the position open with a SL seven points from the open of the last bar looks profitable at first look.
As an example, (on 30min TF), NF has trended from 5168 to 5216 on the last three bars before 15:30 on Jan 31 and 15:30 opened at 5206.5. The ideal would be to carry the trade with SL at 5199.5 seven points from the open. The low touched by the bar is 5205, the high 5233 and close at 5230 a squeeze of 25pts plus. Same story on 30 Jan. The trend at 15:00 is down. Last bar open at 5123 makes a high of 5127 a low of 5102 and closes at 5105, a squeeze of 18 pts.
This is not a strategy to initiate trading on the last bar but just a pointer to what we can perhaps do if we are already in trade and profit. Just did a random survey (not a rigorous back test) over the last six months and found that the idea may hold some value and wanted to share it.
Looking back at the last bar (15:00 to 15:30) over a period of time, I found that the last bar goes less than seven points in the direction opp to the trend on most of such trending days most times (Double qualifiers for caution!). Say NF has been trending fifty points or more for the last couple of bars prior to the last bar, then keeping the position open with a SL seven points from the open of the last bar looks profitable at first look.
As an example, (on 30min TF), NF has trended from 5168 to 5216 on the last three bars before 15:30 on Jan 31 and 15:30 opened at 5206.5. The ideal would be to carry the trade with SL at 5199.5 seven points from the open. The low touched by the bar is 5205, the high 5233 and close at 5230 a squeeze of 25pts plus. Same story on 30 Jan. The trend at 15:00 is down. Last bar open at 5123 makes a high of 5127 a low of 5102 and closes at 5105, a squeeze of 18 pts.
This is not a strategy to initiate trading on the last bar but just a pointer to what we can perhaps do if we are already in trade and profit. Just did a random survey (not a rigorous back test) over the last six months and found that the idea may hold some value and wanted to share it.
