There is a substantial risk of loss associated with trading Derivatives . Losses can and will occur. My methods will not ensure profits
Thursday, June 13, 2013
13062013
Nifty gaped below PDL , attempted to close the gap and failed. Went long on the BOF of BRN. This did not move as expected. Scratched it. Nifty channeled for a while and then traded in a range. Did not get any other signal to trade.
Good. But the trade was very risky one For BOF of a range high, the target is always the other extreme of the range.Here your IR was too tight to trade.
ST what you are saying is unless you see a clear 30 points edge you will not take the trade (exceptionI can think of are the cigarette butt BO trades, where the market is trapped in a tight range for more than an hour) - rb
I think your comment is related to my answer to adhi. Let me explain
There is no confusion regarding IR low. Adhi took the 6th bar high 5726 as IRH.IRL,the logical target of the BOF trade is 5715 ignoring the tails.If you consider commission+ slippage as 4 points potential is only 7 points. not a worthy trade. Now think about the IRL( not on hind sight}. It is the first bar of the day. It withstood the 60 point gap down attack by the bears in a down trending market.Absorbed a massive selling of 12000 nifty lots. The trade was bad even if it made money. I am not against trading even 10 point ranges. But you must well aware of the big picture
In that trade, my thought was only to trade with the trend(i am usually avoid CT trades). But really i have forget the IR low before taking the position. That was a mistake.
I have taken today's 6th bar as IRH. Market moved above it and came down below IRH. I have traded it as a BOF of IRH and covered with 15 pt profit.
ReplyDeleteAdhi
ReplyDeleteGood.
But the trade was very risky one
For BOF of a range high, the target is always the other extreme of the range.Here your IR was too tight to trade.
ST
ST what you are saying is unless you see a clear 30 points edge you will not take the trade (exceptionI can think of are the cigarette butt BO trades, where the market is trapped in a tight range for more than an hour) - rb
ReplyDeleteRaghu
ReplyDeleteI think your comment is related to my answer to adhi. Let me explain
There is no confusion regarding IR low. Adhi took the 6th bar high 5726 as IRH.IRL,the logical target of the BOF trade is 5715 ignoring the tails.If you consider commission+ slippage as 4 points potential is only 7 points. not a worthy trade.
Now think about the IRL( not on hind sight}. It is the first bar of the day. It withstood the 60 point gap down attack by the bears in a down trending market.Absorbed a massive selling of 12000 nifty lots.
The trade was bad even if it made money.
I am not against trading even 10 point ranges. But you must well aware of the big picture
ST
In that trade, my thought was only to trade with the trend(i am usually avoid CT trades). But really i have forget the IR low before taking the position. That was a mistake.
ReplyDelete