There is a substantial risk of loss associated with trading Derivatives . Losses can and will occur. My methods will not ensure profits

Thursday, August 2, 2012

02082012

Nifty gaped down a little and sold. Bias was bearish . I was looking to short . Did not retest DO-IR High. LOL BOF of IR Low/PDL was a long signal. Got stopped out. Hesitated to go long at A after the second BOF. Missed a good move. TST of DO gave a short signal which made a little profit. Last BOF of HOD was a scratch.
Follow up action is missing even after strong BOF.There is a lack of interest in the market. There is no participation from traders. Volumes are drying up what could be wrong ?


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8 comments:

  1. Sunil SaranjameAugust 2, 2012 at 6:46 PM

    ST, I think there are buyers stepping in around 5220 and the Spot to Futures premium hints at a breakout over 5250 spot.

    Tomorrow is the day of some action.

    Thanks,

    ReplyDelete
  2. Raghu R BhatAugust 2, 2012 at 10:33 PM

    Could get in at A to exit at 46. Earlier got stopped out of a long at IR low. Later on went long around 2:30 when prices moved up 10 points over WMA. Went along with the bear squeeze and exited at 3:28.
    Today qualifies for a NR-day so possibly tomorrow may be large range day. my bet is on the downside.
    rb

    ReplyDelete
  3. Kamalesh P LangoteAugust 3, 2012 at 9:51 AM

    My experience is it is difficult to trade when the trading range for the day becomes small. Where the high/ low difference for the day is 20-30 points, breakouts become unreliable. A breakout should ideally lead to a big move and if it fails to happen, then it means something else is happening and we should exit a trade.

    ReplyDelete
  4. Raghu R BhatAugust 3, 2012 at 11:47 AM

    KPL - look at volatility cycles - low vols will be followed by high vols followed by low vols. So a small range means there is a good chance of BO - but one may decide not to take the trade due to other factors. When Nifty vols are 1.5% BO will give 30 points, when 1% as these days BO will give 15 points etc.
    regards
    rb

    ReplyDelete
  5. AnonymousAugust 3, 2012 at 12:19 PM

    Chart is same. Price action is same
    But different traders look at it in different ways and end up with dr or cr in their trading account.

    For eg
    I saw the gap down and pullback as BPB and shorted at pullback and covered at PDL.

    ReplyDelete
  6. SMART TraderAugust 3, 2012 at 1:03 PM

    @ KPL Sir

    You are right.If the breakouts are not working, something is wrong. there is a lack of interest among participants. Better to avoid mediocre setups.

    ST

    ReplyDelete
  7. SMART TraderAugust 3, 2012 at 1:10 PM

    @ SS
    Today being Friday there could be some action it seems

    @Raghu

    Could not follow your 1%, 1.5% volume criteria for breakouts. Would you be kind enough to elaborate.

    @ Anon

    That is the beauty of trading.
    Beauty lies in the eyes of beholder. so true.


    ST

    ReplyDelete
  8. Raghu R BhatAugust 3, 2012 at 1:48 PM

    Sorry not volume - but volatility. With nifty range of 75 points (1.5%) approx one could look for 3 legs of 30 points each. For lesser nifty range 3 legs of 20 points etc. This could become BO targets. Lately with compressed nifty range we are hard pressed to find 15point legs. As i write this nifty has made a 50point move. so things are back to normal it seems, volatility wise.
    rb

    ReplyDelete

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