Thoughts on Day/Swing Trading

Excellent thread Mr Smart Trade.

One question for you.Market has broken its strong resistance at 5200 lvl on muhrat trading.And next day it opened gap up. Now assuming one was not trading on muhrat day and wanted to initiate swing longs is it advisable to initiate longs on such huge gap up or one should wait for some retracement.
Wanted to know how did you handle your swing trades?

Thanks for the kind words , Blitzz........

A swing trade method which I trade is long from before the muhurat day.....but assuming one does not have any position on Muhurat day, the market was coming out from a sideways accumalation we had for last 2 months....such breakouts will not give much deep corrections as the trend has been set in motion, it will take some time and distance before it shows any correction. So the intraday corrections are the only corrections we are going to get....

So the proper action is buy at the best possible level ....dont wait for deep corrections as you will never get them so soon.....

Smart_trade

Rightly said. Waiting for deeper correction wont be a good idea. Will try to get in at a good price. 5450 would be my initial target for profit booking. Nifty might hit a roadblock there.

How strong do you think this trend line is Mr. Smart trade? Please throw some light on how you handle your positions near such trendlines.

Blitzz

Hi ST

This may be the wrong thread.However since I plan to day trade. I have created my MM and RM plans. I am confused with the no of available setups. Also not sure what triggers should I use in those setups for entry and exits. May be I should create different setup for different market conditions. And also I have constantly heard backtest the system.How do I go about back testing the system. so that I can check it under different market conditions.

Take 1-2 set ups with which you are comfortable and find out how the trades were in last 3 months. Make a record of all the trades, how many were successful, how many were loosers, total points made, total points lost,how many consecutively loosing trades and how many consecutively winning trades....in short find out what would have happened if you traded on these set ups for last 3 months.

Intraday trading is very fast....so there is no time to think. You must have a well thoughtout and tested strategy and all you have to do is take trades mechanically as per the strategy. Think about entry,adds,position sizing,profit taking,stoplosses, how will you trail stops .....it is a difficult task to put everything in place, but it is necessary if you wish to succeed in daytrading.

Your set up could be as simple as a moving average...but when you put all the above to it, it becomes a lethal daytrade method......

Good wishes for your success....

Smart_trade

Update .....with my view

Hi Satyen, so what is your view, where will Nifty go, and the reasons for it...Thanx

Hi PT ,Sorry For Late Reply

No do not know where nifty will go , as whole thing is probability ...
But i am Bullish, as I posted first post on this trend

Yes Reaon dont know much ..... as ST da in this thread taught about sideways, Trend , gaps between pivot just applying that

Movement of price may have infinite no. of reson but sticking to what we know may help us : Just my view

Yesterday was a classic example of difference in VWAP and Nifty Futures exceeding 25 points and NF cracking the low of the day in 2:40 bar on 5 min timeframe indicating that the bulls are getting squeezed and soon there will be panic in the bulls camp and the market is likely to crack further .....this prompted to hold the short positions till the end as the squeeze was near the end of the day.....that is what happened in the end and the panic in bulls camp gave a great chance to cover the short positions at very opportune levels with minimum slippage......

Note that the low of the day was a red TDST level which was a strong support level known in advance.....indicating the profit taking level.......and the 9 marked on the chart is a 9th Set up bar indicating we are near the low of the day....this with TDST level gave exact bottom to book the profits.....

A good daytrader is neither permanant bear nor permanant bull ......but he is an opportunist....he senses the opportunity,has his risk control in place...takes the trade......joins the stronger group ( be it bulls or bears ),rides the trend and says 'thank you'. He is never bothered about why the market fell or rose.....he is happy both ways....

Smart_trade

Hi ST

I try to test your idea to the point with a lot of enthusiastic. No hedge with options, just plain futures.

Any comments on that:



Starting the trading day with the entry on 1239.00 around 03.30 on time scale.
Stop as you say by the last pivot : 1231.00 which took around two hours to occur.

The problem here was to ignore, that Stoch was on this time frame on top ( 3 Minute ).

As I test your idea, in the past I was not looking at pivots as you mentioned in some of your last few post.

Today I included that for naked future trading and I recognized a discrepancy between entry on your mentioned pivots and entries on looking at Stoch.

I am clear, that Stoch is at low at 1231.00, but what kind of hint would I have to known, that I could be some how sure, that it not moves further down?

Any comments on that?

DanPickUp