Two candle strategy

karthik_sri

Well-Known Member
#1
Dear TJ Friends,
After a long time coming up with another strategy "TWO CANDLE STRATEGY". There will be no Indicators involved in this strategy and Trade is purely based on the TWO CANDLE!! I have started using this strategy for quite some time and thought to share with you all. Will come up with my Strategy with Rules:)

Cheers
Karthik
 

Rish

Well-Known Member
#2
Dear TJ Friends,
After a long time coming up with another strategy "TWO CANDLE STRATEGY". There will be no Indicators involved in this strategy and Trade is purely based on the TWO CANDLE!! I have started using this strategy for quite some time and thought to share with you all. Will come up with my Strategy with Rules:)

Cheers
Karthik
:thumb::thumb::thumb:
 

anup

Well-Known Member
#3
Dear TJ Friends,
After a long time coming up with another strategy "TWO CANDLE STRATEGY". There will be no Indicators involved in this strategy and Trade is purely based on the TWO CANDLE!! I have started using this strategy for quite some time and thought to share with you all. Will come up with my Strategy with Rules:)

Cheers
Karthik
Welcome Sirji, I am one of the biggest fan of your all strategy.. Will be watching closely
 

jamit_05

Well-Known Member
#4
Dear TJ Friends,
After a long time coming up with another strategy "TWO CANDLE STRATEGY". There will be no Indicators involved in this strategy and Trade is purely based on the TWO CANDLE!! I have started using this strategy for quite some time and thought to share with you all. Will come up with my Strategy with Rules:)

Cheers
Karthik
I probably have a vague idea about this strategy. This strategy has worked wonderfully since in all of 2013. But, it has some inherent flaws. Did you see its performance in Oct, Nov, Dec of 2012?
 

karthik_sri

Well-Known Member
#6
Strategy

We look for subsequent Two Green/White candle for Long & Two Red/Black candle for Short.

Rule:

1). The Second candle of the same color should not touch 50% of the previous candle.
2). When the condition (1) is met we place buy or sell order at the high/low of the second candle.

Target/Exit :

In case of Buy : 50% from the 1st candle Low and 2nd Candle High (Low-High/2) from the Buy price
In case of Sell : 50% from the 1st candle High and 2nd Candle Low (High-Low/2) from the Sell price

Stop Loss

In case of Buy: Target price difference less from the High price
In case of Sell: Target price difference plus from the Low Price

Applicability of Scrips: This strategy can be applied in all the Scrips, Futures, Options, Commodities. But better to avoid penny stocks/scrips

Applicability of Time frame: Can be applied in EOD, Hourly & any Time frame

The above Rules of Entry, Target & Exit will be confusing but I will explain through posting charts.

Cheers
Karthik
 

karthik_sri

Well-Known Member
#9
I have posted the chart of LT (Futures) scrip (17.09.2012). The time frame is set at 30min. The subsequent candle is circled and marked in Red. As a condition the second candle didnt touch the 50% level of 1st candle. We place buy order at high price of 2nd candle which is 1554.65 The target is marked in Green & SL in Red. By this the Risk Reward Ratio is 1:1

The Lot size of LT is 375 and profit is Rs.4500/-:thumb:

http://img203.imageshack.us/img203/9958/24wd.png

Karthik
 

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