Candle’s Body Shunting

Candle’s Body Shunting is valid for Momentum or Strength Candles in Nimblr TA’s Price Flow Analysis.

Strength Candle can be Bullish or Bearish Strength Candle

Whenever Close of a Star marked or Strength Candle closes above the Open with a Body Height greater than 50% of Candle Height i.e. BH>50%CH it is a Bullish Strength Candle.

Bearish Strength Candles: (BeSC) Whenever Close of a Star marked or Strength Candle closes below the Open with a Body Height greater than 50% of Candle Height i.e. BH>50%CH it is a Bearish Strength Candle.

Two Types of Candle’s Body Shunting are observed in case of:

*Rising Strength Candles

*Falling Strength Candles

Whenever the Open of a rising strength candle is lower than or Equal to the close of a previous highest closing rising Strength Candle in the rise, it is a case of Candle’s Body Shunting.

Whenever the Open of a falling price strength candle is higher than or Equal to the close of a previous lowest closing falling Strength Candle in the fall, it is a case of Candle’s Body Shunting.

In ascertaining overlaps use cross-wire scroll all the time on charts as shown by the horizontal line.

In Body Shunting the shunting of Close is always of previous candle and Open of the next or new or current candle.

Bodies are placed like locomotive wagons one ahead of the other.

Between two Body Shunted Strength Candles they may have one or multiple ‘in-between’ candles.

The ‘in-between’ candles can be strength or non-strength candles.

In Body Shunting always the Close is connected to Open and hence symbol for Body Shunting is ‘C=O’

Overlap of Bodies is permissible only to the extent of shunting.

Adjacent Candles are Overlapping and hence not consider as a case of Candle Shunting.

One of the two, the Open or the Close of next candle must be out of the common value range. In the below case they are in the common body range and therefore it is not a case of Body Shunting.

In other case the Open or Close of next candle is completely out of the range of previous candle and avoids Body Shunting all together, to give a Body Gap between two strength candles.

The Body Gaps are Indecision Zones.

Body Shunting provides a ‘connect’ between Open and Close and makes the two strength candles conductive to price flow through each other’s value ranges in a free flow manner in either direction without any obstruction to touch ends of both the candles.

Body Shunting classifies price flow in to two distinct values ranges:

Momentum Range

Indecision Range

To Identify the Price Flow direction, Blue Line connecting the close of Body Shunted Strength Candles are drawn.

And the next chart is the Indecision Zones for the same chart.

The Case Study explaining Candle-By-Candle Interpretation will appear in a separate post with slides.

Till then make the best understanding of the concept.

DTR & Low Margin Cash Trading

Daily True Range (DTR) as will be commonly referred here onward is in short the Difference between High and Low to the Open of the Day.

Daily True Range has its importance in Day Trading where trades have to be squared-off by end of Day.

It revolves around trying to gauge if there is any scope for further intra day rise or fall in the direction of trade.

It starts with noting the day’s High and Low and the difference as a percentage to Open of the Day.

It is a foot rule guide for measuring price flow in terms of percentages that can relate well to the percentage margin one pays for a trade.

It can help in deciding at what stage of momentum one can assume that the best of the rise or fall has occurred.

Every day a Stock or an Index may have its own milestones, occurrences and a few events that may term it as an Event Day.

At some juncture every day must know depending on what is High and Low Difference as a percentage to Open whether it is an Event Day or a Non-Event Day for the Stock.

The DTR differs on Event Days like Corporate Results and other wise on Non-Event Days.

DTR – Day’s True Range, is Difference between High and Low of the day as a percentage to Open Price.

Namely in Intra Day we follow:

DTR – OR i.e. Open Range. It is the DTR at the end of Open Range of first 15 of a Day.

DTR – OR therefore is Difference between High and Low of the day till the Open Range ends at 9:30am as a percentage to Open Price.

dtr values on screen A

DTR – OR appears circled in yellow at left just above the first three candles of 5min for the day that form the Open Range. The percentage has a significance. It must not exceed 0.76% for a stock to allow scope for trading gains later. On the right corner is the DTR in Value and Percentage updated at every tick throughout the day and at the close of the day it reveals the DTR Value and Percentage at the close of day.

As the day progresses next comes the Breakout from the Open Range High or Low with a valid Breakout Process.

DTR at the time of Breakout is DTR – B

DTR OR BO a

In the example, you will observe DTR – OR as 0.93% and DTR – B at 1.47% and DTR by close of day at 3.13% at extreme left top corner.

Depending upon the DTR-B, a trader can decide likely DTR Left (DTRL) which is the possible scope left in percentage terms of a likely further price flow provided DTR Average as per margin is known.

DTRA is the Average of Maximum High-Low Difference recorded over the nearest past few months based on Liquidity and Volume of transactions and such average is adjusted to nearest Fibonacci values as in Pic.1

            pic 1        pic 2

Depending upon Margin for the Stock, DTRA varies and is directly proportional as in Pic.1

Margins vary from 0.25% to 5% in Cash or Spot and accordingly the average Max DTRA  on a Non-Event Day (NED) is as shown in Pic.1

However on Events Days (ED) with results or any other announcements by the company, stocks tend to exhibit more volatility.

Like in the case of SBI with 0.5% Margin the stock that may show DTRA of 2.23% on NED days as per table but may be more volatile and have range to the extent of two levels higher of up to 3.23%.

A table with DTRA on both NED & ED Days in Pic.2

DTRL as referred earlier is the possible scope left in percentage terms of a likely further price flow in the direction of trend and therefore

DTRL = DTRA – DTR

For example if you wish to Enter in a Trade in  0.5% Margin stock HDFC Bank which has probability of High to Low Difference % of 1.62%  on NED and at the time of Entry the DTR achieved was 0.54%  then  balance of DTR Left (DTRL) is 1.08% which can be sizeable as Margin is 0.5%.

A Ready Reference Google Document https://docs.google.com/spreadsheets/d/1BgUI20NXXRWSAhwTpi4bWFrrYk8-X6WP9rtVR68DOdw/edit#gid=0

is available that updates every 5-10secs on DTRL and DTR done with Targets on Upside  and Downside calculated based on DTRA.

Depending if DTRL is sizeable one can Enter a Trade.

In the second part we will take up Margins and Exposure depending upon Proximity of Stop Loss even touching on RR & Return on Margins(ROM’s)

Your queries may be posted.

 

When Reversals Occur!

When Reversals Occur!

What is the likely starting event when it is time for Reversals?

Reversals could be at a High to go short or at Low to go long.

STEP 1

Reversal starts with a Day’s High that is higher than the previous two days High or a Day’s Low that is lower than previous two days Low.

What does a Day’s high that is higher than previous two days High look like? Here is a 15min chart of prior three days to illustrate.

blog 1

You will find a High formed during the day that is Higher than previous two days High.

What does a Day’s Low that is lower than previous two days Low look like? Here is a 15min chart of prior three days to illustrate.blog 2

You will find a Low formed during the day that is lower than previous two days Low.

Such an occurrence is the starting to a likely Reversal. One therefore needs to go long or short with a caution if High or Low is formed on the third consecutive day.

Later on, will separately consider Low or High of Yesterday as Lower or Higher than previous two days cases too in a separate blog post.

Step 2

Spot two consecutive strength star marked candles after the High or Low as a confirmation of Intra Day Top or Bottom.

Let’s spot the consecutive strength star marked candles that support the breakout on the chart with High that is higher than previous two days.

blog 3

Close look at the Consecutive Candles.

blog 3 1

Let’s spot the consecutive strength star marked candles that support the breakout on Low that is lower than previous two days Low.

blog 4

Close look at the Consecutive Candles.

blog 4a

Next two Steps 3 & 4 can precede each other on first come first basis. If Step 4 occurs one can act as Step 3 will follow.

STEP 3

EMA Ratio Confirmation which is about converging EMA’s diverging from each other.

Let’s identify visually for Short Sell.

blog 5

Close look at the EMA Ratio Confirmation with calculation methodology as follows.

blog 5a

Ratio Value in Range of 0.38-2.23 provides EMA Ratio Confirmation.

This allows for proper timing and the signal may appear over 1 or 2 candles i.e. 5-10 mins. on a 5min chart to Act.

Let’s identify visually EMA Ratio Confirmation for reversal that leads to Longs.

blog 6

Here the EMA Ratio Confirmation is delayed as the EMA’s had not converged closely prior to diverging. This is the reason why we are open about Step 3 and Step4 can precede each other and whichever occurs first to be taken as signal

Step 4

Lower Time Frame CCI 34 5min moving above 100 or below 100 for Lower Time Frame Momentum.

If it precedes EMA Confirmation, the same can be taken as a signal to Act even if EMA Ratio Confirmation hasn’t occurred.

Let’s identify visually Reversal for Short Sell

blog 7

Here the CCI 34 5min < -100 follows after EMA Ratio Confirmation. So Step 3 can be trigger to Act.

Close look for CCI 34 5min < -100

blog7

Let’s identify visually Reversal for going Long.

blog 8

Here the CCI 34 5min > 100 precedes Ratio Confirmation and can be considered to Act, even if Ratio Confirmation is yet to occur.

Close Look for CCI 34 5m > 100

blog8

Observing Red CCI 34 30min preceding moving above 100.

If at all CCI 34 30min moves above 100 or below -100 earlier than CCI 34 5min and if the EMA Ration confirmation is in place, it can be considered to supersede  CCI 34 5min, as is seen in these case happening where CCI 34 30min crossing above 100 is three candles earlier i.e. 15min earlier.

STEP 5

Previous Day & Prior Day Open proves as Resistances or Supports in Reversal Buy or Sell respectively.

When Step 4 is reached one can review chart on a Daily Time Frame and note the previous day and prior to previous day Opens too. These Opens stand as resistances. If price moves above these resistances explosive spurt can be expected.

Let’s watch the same in case of earlier 4 day 15min charts with their Open and the price movement after crossing those Opens.

Continuation Lines from previous day opens are marked on current day chart and you will observe how much they matter.

blog 9

Once these supports give way for a further fall one can be sure a medium term Top is formed and Intra Day trade can be converted into a Positional Trade.

Let’s now watch how previous Open Levels prove to be resistance levels in case of reversal to Longs.

Continuation Lines from previous day opens are marked on current day chart and you will observe how much they matter.

blog 10

The earlier Open Levels prove to be resistance levels to cross for further upside spurt. Once done can be sure of a medium Term Bottom and Intraday trade can be converted into a Positional Trade.

Close above or below previous day ensures better directional price movement next day.

STEP 6

Higher Time Frame CCI 34 30min turning above 100 is a confirmed momentum for next 2-3 days.

Trade is confirmed as Positional once that happens.

STEP 7 Exists

Exits apply as per below:

Cardinal Rule to Stay in Trade for CCI 34 5min:

Buy Hold/Long till CCI 34 5min remain above -60

Sell Hold/Short till CCI 34 5min remains below 60.

How to go about practicing?

System trigger tweets from @kkonline.com @orbalerts are available and they can be used for study and trading as per description. Chart set up may also be available.

Reversal trades can to be erratic to trades.

Queries or clarifications can be posted.

How Long to Stay in a Trade?

Patience or Process?

Can Process lead to staying with Patience in the Trade?

Answer to you by the end of the post.

Early Exits out of fear and Impatience comes from Ignorance and Uncertainty of how much to Stay in a Trade!

How Long to Stay in a Trade

With CCI we have a process that answers and provides a solution.

Staying in the Trade is decided by CCI 34 5min and with the strength assessment of momentum provided by CCI 34 30min. Both together are variables for either Staying in the Trade or defining the Exit Strategy.

So in a way we are now touching Exit Strategies.

In our CCI Multi Time Frame Window the Blue CCI line is CCI 34 5min.

Cardinal Rule to Stay in Trade for CCI 34 5min:

Buy Hold/Long till CCI 34 5min remain above -60

Sell Hold/Short till CCI 34 5min remains below 60.

Strength of assessment of Momentum is as usual must follow based on CCI 34 30min staying above 110 or below -110 for Long or Short respectively.

Both together give us Conditions to Stay in Trade as below:

Buy/Long

When CCI 34 5min drops below -60 but CCI 34 30min is above 110 no need to Exit instead continue to stay in trade till both concurrently go below -60 and 110 respectively i.e. Exit Strategy for Buy/Longs.

Sell/Short

When CCI 34 5min climbs above 60 but CCI 34 30min is below -110 no need to Exit instead continue to stay in trade till both concurrently climb above 60 and -110 respectively i.e. Exit Strategy for Sell/Shorts.

CCI 34 5min is Instrumental in our Exit Strategies backed with concurrent confirmation of loss in momentum by CCI 34 30min either moving below or above 110 or -100 in Long & Short Trades respectively.

Let’s take a Case Study Chart as below.

cci 34 5min stay in trade

As the events have occurred:

Breakout below Open Range with consecutive strength star marked candles with CCI 34 30min < -100 provides with the Breakout Momentum Trade @ 1464

At the same time CCI 34 5min the determinant of our Exit Strategy and Staying in the Trade too moves below -100.

The fall in price continues till CCI 8 5min spurts above -135 providing us with a Pull Back second Short entry for Pyramiding as concurrently CCI 34 30min remains below -110.

Even with this, CCI 34 5min hasn’t moved above 60. Hence it never was the need to Book Profits or Exit form the trade.

As would follow price declined with close and low for the day been same.

Let’s review two more charts where when had to act to Exit.

Prior to that let me remind that a Trigger to Exit does not mean instantaneous Exit. It’s only a decision to pack our bags. The Moment to close the trade is governed by CCI 8 5min with its rule:

Buy when CCI 8 5m<-135 provided CCI 34 30min >110

Sell when CCI 8 5min > 135 provided CCI 34 30min <-110.

For Exit the Action Moment is when:

Exiting a Buy Trade

When the Buy trade turns suspect, one needs an Exit

What is bought earlier has to be sold.

And the Rule for Sell is CCI 8 5min > 135 provided CCI 34 30min is < -110

Case Study

INTRA DAY EXIT 5

Events from the left to right are:

First a Momentum Breakout to Enter Buy Trade

When CCI 8 5m < -135 occurs at 534 bought on Pullback.

However, price kept sideways till CCI 34 5min fell below -60 concurrently even CCI 34 30min moved below 110.

That was a Signal to Exit the Trade.

What was bought earlier had to be sold.

And the Rule for Sell is CCI 34 5m >135 provided CCI 34 30min stays below -110.

When next CCI 8 5m > 135 moment occurred at that point :

CCI 8 5 min .. 137

CCI 34 30min ..106.65

CCI 34 5min .. 101.85

While we waited to Exit as per CCI 8 5m > 135 to our advantage CCI 34 5min turned bullish with value 101.85.

So Exit plan gets cancelled.

Exiting a Sell Trade

When the Sell trade turns suspect, one needs an Exit.

What is sold earlier has to be bought.

And the Rule for Buy is CCI 8 5m <-135 provided CCI 34 30min is > 110

Case Study

INTRA DAY EXIT 4

Events from the left to right are:

First a Momentum Breakout to Enter Sell Trade

When CCI 8 5m > 135 occurs at 6614 short sold on Pullback.

However prices kept appreciating till CCI 34 5m moves above 60 concurrently even CCI 34 30min moved above -110.

That was a Signal to Exit the Trade.

What was sold earlier had to be bought.

And the Rule for Buy is CCI 8 5m <-135 provided CCI 34 30min is > 110

So we waited for next 13 candles i.e. near an hour for CCI 8 5m to moves below -135 and when that happened concurrently CCI 34 30min below -110 and we managed to Exit at 6622.

If we would have exited at first signal we would have exited at 6635 but by following CCI 8 5m Buy Rule we saved a few and bought at 6622.

There after it offered another Exit at 6605 just for academic interest.

We come to the end of the post.

Exit strategies can reduce a good amount of losses if the method is followed.

As a when over the next few days would add a more cases depending among queries to this post.

We move here on to Reversals. A subject discussed through tweets but no write up as a blog post.

 

Pullbacks & CCI Indicator

Pull Backs are discussed with CCI Indicator as supporting tool. We begin with brief parameters of CCI in use here.

Commodity Channel Index referred as CCI is used with two variables, period and time frame.

Period pertains to No. of Candles and the Time of Candle in minutes or hours or days or weeks or months or yearly for which the Closing Price is available.

Say, if it is technically written as CCI 34 30min, then the number of candles it considers is 34 and period of each candle is 30min.

Say, if it is technically written as CCI 34 5min, then the number of candles it considers is 34 and period of each candle is 5min.

Similarly, if it is technically written as CCI 8 5min, then the number of candles it considers is 8 and period of each candle is 5min.

We differentiate period 5min as Lower Time Frame and 30min as Higher Time Frame for Intra Day Trading.

Notes below are purely observational and any theoretical construct can be studied as per a few website mentioned at the end.

A standard Nimblr TA chart has a price window and below a Multi Time Frame CCI (MTF CCI) window.

REL 49

Let us focus on the below price window.

It has three CCI Lines.

Thin Yellow – CCI 8 5min

Thick Blue – CCI 34 5min

Thicker Red – CCI 34 30min

Observe the thin Yellow line oscillates the most as it is on Lower Time Frame of 5min and even period 8.

Followed with lesser oscillating CCI 34 5min and least oscillating CCI 34 30min. The chart time frame is on 5min.

Observe the lines above zero of 60, 100,135 and 175 and below zero of -60,-100,135 and -175.

We classify price movements under following two trades:

MOMENTUM TRADES

PULLBACK TRADES

REVERSAL TRADES

Let’s start deeply observing Momentum Trades for which CCI 8 5min is instrumental.

We call them Momentum Trades on Intra Day because apart from CCI 34 30min>100 condition they also satisfy breakout above day’s Open Range High.

Let’s take CCI 8 5min and following chart for dissertation.

1

It is the one we use to Enter and Exit a trade provided some conditions are true.

General Rule for CCI 8 5min in Momentum-Pullback Trade or that matter many other conditions taken up later are:

CCI 8 5min Buy/Long if < -135

CCI 8 5min Sell/ Short > 135

This Cardinal Rule is used to Enter a Buy trade when <-135 and Exit or Book Profits when >135 to complete or close the trade.

Similarly, Enter a Sell trade when >135 and Exit or Book Profits when <-135.

Pullback Trades are best to add positions to your earlier entry and also called a Pyramiding trades.

In such Pullback and Pyramiding trades the original trend of underlying is highly bullish or bearish.

In ascertain this bullishness and bearishness we move to observe CCI 34 30min which determines our trade direction to trade.

If CCI 34 30min is >100 or just breaks out above 100 it is said to have gathered Bullish Momentum.

The Cardinal Rule that must support the Entry as per CCI 8 5min is concurrently CCI 34 30min must be:

Buy/Long if > 110

Sell/Long if <-110

Both collectively, the Conditions for Pullback & Pyramiding Entry are:

Buy/Long if:

CCI 8 5min < -135 provided CCI 34 30m >110

Sell/Short if:

CCI 8 5min>135 provided CCI 34 30m < -110

Let’s start deeply observing purely Pullback Trades for which CCI 8 5min is equally instrumental as ever.

We call them pure Pullback Trades on Intra Day because they do not need occurrence of Breakout above Days Open High apart from CCI 34 30min>100 condition of Momentum.

pyramidng prior to BO

All other conditions and process mentioned before remains same except for the location of Pullback Entry can be prior to Breakout.

With his we complete Role of CCI 8 5min in Pullback Entries and Pull Back in general and move on in the next blog post to the Role of CCI 34 5min in Staying in the Trade.

How traders use CCI? https://www.investopedia.com/articles/active-trading/031914/how-traders-can-utilize-cci-commodity-channel-index-trade-stock-trends.asp

Commodity Channel Index https://stockcharts.com/shttps://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:commodity_channel_index_ccichool/doku.php?id=chart_school:technical_indicators:commodity_channel_index_cci

Multi Time Frame https://www.mql5.com/en/market/product/15372

Chartilink Screener for Intra Day Buy/Long https://chartink.com/screener/cci-momentum-retracment-buy

Chartlink Screener for Intra Day Sell/Short https://chartink.com/screener/copy-cci-momentum-invest-14

Chartlink Screener for Investment Buy Pullbacks https://chartink.com/screener/copy-cci-momentum-invest-3

Scalping

Scalping!

If one is involved in Directional Technical Analysis, best is to indulge in Scalping! Scalping need not mean 5-10mins arbitrage like trading. Scalping can last from 30mins till 15:15hrs near close of the day.

Scalping is best in Low Margin Cash Stocks like Reliance, SBI, TCS, Infosys, L&T, Hind Lever, HDFC, a few Banks like HDFC Kotak Axis, Sun Pharma etc.,

Scalping is best in Low Margins of 0.25% to 1% to capitalize on moves small enough of 0.5%-1%. Scalping needs brokerage levels of not more than 0.05-0.1% also providing exposure of 25-90 times.  A typical Reliance with 0.25% Margin may achieve exposure of 80-90 times depending on proximity of Stop Loss.

Scalping is best with Stop Loss 0.38% below or above Low or High of next immediate Higher Time Frame Indecision ( BH<50%CH) Candle. Immediate Higher Time Frame Indecision (BH<50%CH) Candle takes care of varying ATR of immediate move than  average ATR of previous days that could either Stop one out or Exit early in momentum-filled trades.

Stop Loss based on Immediate Higher Time Frame Indecision (BH<50%CH) Candle could be in the range of 1-2% from one’s Entry Price. Stop Loss defines Risk: Reward(RR). In Scalping one’s obsession on RR needs a shift to Return on Margin Paid as in a short 30mins or so, RR may not be achievable.

If 1-2% Stop Loss from one’s Entry Price is not to your liking then indulge only in Pullback or Reversal Trades as Momentum Trades may call for a faraway deep Stop Loss SL of 1-2%.

Scalping is best over maximum 10 trades per day. You can end trading on  profit after first or 4th trade too. If you start with Day’s Trading Capital of Rs.50,000/- do not trade if margin demand exceeds Rs.5,000/- per trade.

As earnings range could be in the range of loss 100% to profits of 300%, each trade to be kept within 1/10th. Of Day’s Trading Capital.

Even if the first trade nets Rs.2000/- on Rs.5000/- Margin the return on Day’s Capital of Rs.50,000/- of 4% for the day is reason to halt trading.

Scalping is dynamic in nature but not as fast and furious as many would think so.

Scalping needs a good Technical Analysis practicing system with well defined Exit Strategies that are not dependent on been Stopped out with Stop Los which is a sure shot way to loose 100% of Trade Capital.

Scalping is similar to running a Grocery Shop for smaller gains over multiple trades.

Scalping is a New-Age choice of most to trade with higher frequency for smaller duration and smaller gains. Algo’s best adopt such approaches.

Scalping Trades at the end of the day if in full momentum can be converted into a Positional Trades.

Scalping best suited to those choosing short term certainty over long range expiry gains.

 

 

Being Disciplined

(This post is part of a series of post that would appear on the blog and is a  part of author’s Lecture made available verbatim to you all that would conclude at the end of Process 25)

Lot is been said of one needing to be disciplined or stay disciplined. But none ever states what is actually being disciplined and how does one go about being disciplined.

What does being disciplined really mean?

Why do we need to be disciplined?

Why are we not being able to be disciplined?

Can we ever be disciplined?

Is ‘being’ disciplined ever achievable?

Can we really change ourselves in the way we have been indiscipline to a future way of being disciplined?

Are we pursuing something which is never achievable?

This intended transformation is eluding many of us and many have given up too.

Discipline has no universal parameters. The description of discipline is diverse to each of us.

Discipline is about following the rules we decided we would and therefore in many ways it’s something we said and decided to do and not been able to do.

Discipline starts with what we agreed to do and not been able to do.

Discipline in a way is what we promised to do and never stuck to it.

Discipline is what we committed to do and never did.

Discipline to me, is therefore about one’s integrity with one’s conscious decision to do it.

Not having kept to that Integrity is Indiscipline.

So at the root of discipline or indiscipline, is our own agreement to do something and therefore has nothing to do with any universal parameters, generalizations or norms.

Discipline is purely our own agreement with the Self that is unkept creating a Guilt that demeans us that we are not able to complete the task decided by our own Self.

First easiest way to discipline is to experience ‘restrain’ as a natural behavior or an underlying way of lifestyle.

Followed by believing in ‘less is less leaky’ when it comes to conserving our energy and even money.

We are caught up in believing that the more we do the more are our chances of getting it soon or winning the game which leads to over trading.

Contrary to that, my day trading statistics spread over eight years point to the days when I have traded more than two trades per day as the days that were responsible for more than average losses.

I therefore substitute the word discipline with ‘restrain’ that I find more apt.

The First Generalized Process of Restrain that I widely follow and use it regularly is very simple. It’s simple to follow and the mere saying makes you more agile and aware of your own indiscipline.

It simply says:

Process 1: To stop somewhere is a matter of discipline.

Saying, “Let me stop here” is all what it takes to start with being disciplined. This willingness to restrain is so powerful, it can get you out of most of your wrong habits.

Moving closer to trading is the second rule.

Process 2: To not trade is a matter of discipline.

When your first trade goes wrong moving into second trade is explainable and alright. But to not do the second trade at all, is a great achievement that calls for practicing restrain, when on the one hand is our commitment is to end the day positively with some gains, doing the second trade is a logical.

But what we must appreciate is, not doing a trade is indeed just the beginning of the process of restrain.

Process 3: To not trade is a beginning to reshape past patterns of behavior.

The moment you decide to stop somewhere, you start the process of re-writing over your old habits with new patterns of responding by your new method of restrain.

Here is where some of your old habits die and get rewritten with new ones that are transformational. You have in a way started to stop acting in your old repetitive manner that at many times been deplorable.

Process 4: To stop doing a repetitive deplorable action done regularly in the past is discipline.

Doig the same mistake again and again is deplorable and frustrating. To not doing it, is a great beginning.

The processes 1 to 4 are followed when worked on we get to the next process.

Process 5: Discipline within is knowing where to stop.

Having spoken about the first five processes let me brief you what I really mean by the word ‘Process’.

Process is about identifying your ways of ‘being’ in life especially to relating or responding to something in the context of Discipline. The process demands you write your own observations that are more specific to you and participate with your Self in being aware and agile to your patterns of restrain even beyond trading.

(…To be concluded)

 

 

 

 

 

 

 

 

Auguring Well for Banks

Expansive Jupiter’s Conjuction (24Oct17-1Nov17) with Sun (Govt) in 6th House of Country’s Debt auguring well for Banks till the time Jupiter leaves 6th House on 17Nov18 (Jup Scorpio 7 48).

Jupiter’s stay in 6th House will also lead to rising NPA status. Courts will do well with its enforcing measures.

During Jupiter’s stay in 6th House it would go retrograde from 5Mar18-11July18 corresponding with the time Banks report Annual Performance and NPA status.

As Jupiter is also the Lord of 8th and 12th.House, current measures will have to watched closely as very soon Sat enters 8th House (Sagittarius 3 25)  on 28Nov17 and stays till 25Dec19.

On the whole Banks would report laudable performances till 5Mar18 i.e. for the remaining FY18.

Bank stocks could remain buoyant till 28Nov17 and in the very short term till 1Nov17.

Comments, Clarifications Welcomed !

26Oct17  8:57

Candles First!

Candles first!In the chronology of events and its Importance, Candles come first to be Mastered as a group of Candles lead to Patterns.

Within the Patterns are Candles, that lead to formation of Patterns. And if your knowledge of Candles has clarity, either Strength or Weak (without getting too worried of the names for newcomers to TA) you will trade the Patterns correctly.

Followed by Candle formations, irrespective of whether it’s Ascending Triangle or Head-n-Shoulders, Flags or Pennants, the methodolgy of Box Breakouts take all of it into consideration, keeping things Simple.

Following Clarity on Type of Candle either Strength or Weak, the next on the list for subject learning is Breakouts.

Unfortunately, Breakout Methodolgy as a subject is not so well covered on Google searches on the Internet.

Our many Blog Post on Breakouts will provide clarity to you!

So in essence on the canvas of subject learning, its Candle Analysis first followed with Breakouts!

Can tweet me your questions if in 140 words. If you have long messages can send me a message here.

15Oct17

13:47

How to Fix Stop Loss for Investment Stocks?

In a Monthly Chart take the previous BH<50%CH Candle and place Stop Loss @ one ninth (1/9th.) below the Low of this Candle for the next month Stop Loss. Do it as a one-time activity at the close of every Month.

Here is the Simplified Illustration for Asahi India as a Case Study.

how to fix SL in Inv Stocks

Here the Condition that CCI 34 must be >+100 on Monthly Chart is not  valid or a necessity as Stop Loss will be normally triggered when Momentum drops, which is what we want.

If you are not aware how to analyze a BH<50% CH Candle, here is it

What is BH<50%CH Candle?

BH=Body Height i.e. Absolute Difference between Close and Open of the Candle

CH= Candle Height i.e. Absolute Difference between High and Low of the Candle

Take it’s percentage.

If BH / CH % is lesser than 50%, it’s a BH<50%CH Candle.

Such a Candle lacks direction and thereby referred as Indecisive Candles. Hence the Stop Loss is placed below such Indecision Candles @ 1/9th.  below the Low of BH<50%CH Candles.

E.g. if Low of BH<50%CH Candle is 180,

Then SL = 180-180/9=160.

Refer blog post:

Breakout or Strength Candles

Non-Breakout Candles

How to Fix Targets for Investment Stocks?

While there are many other ways to arrive at Stop Loss, this is one of them.

Comments Clarification are Welcomed.

9Sept17 20:10