Exponential Moving Average

SO WHAT DO U THINK WILL HAPPEN TO THE NIFTY

well it certainly is in a downtrend. a major five red candle breakdown. and then a snap back for two days.

so one could play for the counter trend which is up, though reward risk is 1:1. or wait for it to close up to the sma and then short. or it would breakout up from the sma and then things will be really different.

but for me now it remains up till things tell us otherwise. since it is a counter trend it may not work out but at least i am convinced based on some analogy.

charts dont lie

your views??

 

Thanks Ajay. Very useful info!

 

LETS BE MORE ADVENTUROUS

till now we played the trend move and restd ourselves to the sma.

well if you see a hammer way down away from sma for a stock in uptrend, buy it. further down the hammer from the sma more potent it is. longer the tail of the hammer the aggressive it will be.

any guess which candlestick to look for stocks in down trend but have recently pulled back beyond and higher than the sma.

 

Hi Ajay

Can you give some examples with charts, will be much helpful.

Thanks

 

ok the candlesticks we r talking about r the hammer and the inverted hammer.

see the charts for canbk. in the uptrend look for the classical hammer way down under the sma. the SL will be under the candle every time in case it doesnt work out.

similarly we have to look for inverted hammers above the sma in the downtrend.

actually what hammer is essentially depicting is really a bullish scene. it is telling us now the big guys who were shorting till that point r now turning their view and ready to become buyers. so join the ride up!!

look we may not be correct every time but see it this way'''' when u miss and hit the SL HOW MANY CANDLES DO U GIVE AWAY , YES ONLY ONE. BUT IF YOU R CORRECT U GET MANY OF THEM''''

now see the nifty try to spot the inverted hammer in the downtrend recently and u knew where to place the SL.

 

Hi Ajay
When you say 20 days SMA u mean simple moving averages, but why not ema as it will be more accurate.
As per your experience 20 days SMA is better or 20 days EMA?

Regards
Veren

 

i guess both should work, we use it to judge how far is the present price from mean/average.

this is just a part of the story, focus on the trading part, which makes and looses money for u. HAVE A PLAN TRADE THE PLAN.

when i started more than a year back, did a lot of study and lost money or rather gained experience from the loss. switched between cash markets and F&O. almost gave up at a point.

there are numerous ways to trade with countless strategies. success is when u can profit more than u loose.

HAVE A PLAN TRADE THE PLAN

happy trading

 

I trust in 20 SMA That's what Bollinger Band uses as well.

 

absolutely

hey you said it, that was my next post

use bollinger bands they will give u a good idea, when we know how far is far from the sma

 

Hello Ajay,

Thanks for explaination with chart...one query though

"the SL will be under the candle"...here do you mean SL should be low of hammer or inverted hammer?

regards,
Suraj

 

we look for hammer for a stock which is in uptrend though has pulled back below the sma. meaning we r buying the hammer. so SL is under the hammer.

we look for inverted hammer for a stock which is in a down trend though has pulled up and is above the sma. now we r selling the inverted hammer. so SL is above the inverted hammer.

hope this helps.

 

thanks ajay. What do you think of Nifty now? It seems like it is showing good strength, are we expected to cross 5900 now?

 

5900 is still way up. we still have the sma to cross first.

we traded for the up move the nifty has gained a few points. we could mov the SL to cost to even. let the market decide for itself and we play along. remember its the counter trend. as Shabbir said 5950 is an imp level to watch.

 

Ajay you added an interesting post and method to the forum.
So these days you are in cash or f&o
and what else you follow other than 20 day SMA.

Regards
Veren

 

Ajay,

Is there any intraday strategy using SMA or any other technical patterns...

I tried sma thingy but it hardly works for intraday...

Regards,
Suraj

 

Hi Shabbir,

I think nifty is forming lower high and lower low. Best to short for 2 to 3 trading days. please comment.

Regards,
Kiran

 

hello,

first let me tell all that there is nothing new about this strategy. if you pick up any book on technicals the first chapter discussed is always TRENDS. and it is said follow the trend it makes money. and trends are not in any straight line it goes up then down then again up infact that is the definition of the uptrend higher lows and higher highs.

master this basic thing you will not need anything else. dont worry about the money part. try with only one stock suppose you thought that it should sell out, then sell only one stock in number set your target and SL. do the same thing for a stock on the buy side. do this for sometime till you r able to reasonably predict and feel confident. study about the candlesticks really well.

now i trade in F&O only. used to work in cash but no longer i normally dont leave any open position overnight.

the basis to take position is based on daily charts of the previous day. i isolate maybe ten odd stocks some on the sell side some on the buy side. i dont use charts during trading i focus on the price because that matters. and my advice is dont base your decision on charts intraday since you can follow only few charts and loose the overall big picture.

i use standard odien platform for trading