I am not a fan of multiple time frame analysis. Markets have
no time frames. It produces a continuous stream of data from open to close. We
chop it and chart it as per our own convenience. Candles and resultant patterns
will differ as per the charting method.
This logic is not applicable to ‘Daily’ charts in respect of
a day market. Here there is no question of chopping. They are for real and all
the traders watch the very same levels.That is why levels like PDL,PDH and PDC attracts a lot of
order flow. These are simply the High Low and Close of the previous day candle.
Every ‘Day candle’ is considered as a range. Price breaking
out of this range is a major transition. Price moving above PDH and falling
below PDL are important events. Breaking the PDH is a bullish event and a break
down below PDL is very bearish.
Decision Point method works well when the day traders are in
control of the market and fortunately most of the days they do. But it is
important to know what the positional and investor side of the market is doing
and its impact on our trades. The easier way is to have a look at the daily and
see whether it is in a rally mode or in a decline mode. In other words look at
the micro trend in Daily chart. (Read More)
When market is in a rally mode, buying range lows can be
more rewarding and in a decline mode selling range highs are preferred trades. Be
very careful while shorting rallies and buying on declines. Focus on PDL on
rallies and monitor PDH on declines. Break of these levels will change the
trading mode.
If market trades within a candle for the next few days this
will create a Master Candle and this MC may act as a range. Pay attention to
the MC extremes also.
Do not forget to take your daily dose. It is very important for your financial health
Sir,
ReplyDeleteThank you so much for this highly informative post.
Which one do you prefer for Day charts - Nifty Spot or Futures? Due to ever changing premium, price may not hit the swing high/low of Nifty Futures and Spot charts at the same time.
S.Karthikeyan
SK
DeleteSwing highs and lows are not important here.
The question is whether Nifty daily is in micro trend
That is each successive daily bars making higher highs and higher lows
We are not following the normal trend definition of higher/Lower swing Highs/Lows
Further we are only giving some extra weightage to micro trend in dailies on the decision making process
ST
Sir,
DeleteThanks for the guidance.
S.Karthikeyan
Hi ST
ReplyDeleteThanks for the post.
I completely agree that the daily plays an important role for the nest day trading.
Along with PDH, PDL and PDC, I also keep an eye at Median for the day. I have found that usually when there a fluid between PDH and PDC, the Median for the day plays the role of a DP which can act as a Flip or can create a double bottom or double top and continue further. It acts like a signal.
Thanks for the post and drawing attention to the use of 'Daily Dose'
Plz Click to find Election Result Nifty MC
TBP
MC low gave support. What now
DeleteA BPB or a BOF ?
ST
ST
DeleteLast week it was a Bearish engulf, this week its Bullish.
So lets see. My guess is if 7400 holds then it can avoid a BOF.
TBP
Hi ST,
ReplyDeleteVery informative post.I have been trading Nifty with DP method for past 3 months. I am able to make profits but it has been vanished by consecutive losses. It has been happening again and again. I lost confidence sometime but you people are very successive that made me to stay persistence and get back my confidence to become developed trader. Thank you.
Regards
Arunkumar
Arun Kumar
DeleteUnderstanding the concepts in principles is not enough.
You will not be able to execute it unless you trust it to the core and live by them
After a string of losses you have lost the trust and confidence in the method.You will not be able to trade the method consistently unless you regain this trust. Analyze the historical charts,Paper trade and simulate till then. Do not commit real money. Alternatively you can try the method on stocks with less risk and position
This is a slippery slope and it will take time. Not three months but much much more. It took me three long years to develop a method. Analysing charts regularly for 3 years.Full time trading for more than 9 months but still a single lot trader.
Give your success time to cook.
http://jamesclear.com/follow-recipe
ST
I was not able to execute trades consistently because of my fear of loss. Even one lot of NF was proving too much to handle. So I have now shifted to USDINR. I have fixed my max loss amount per trade with which I am comfortable, and then I manage my positions accordingly. Minifty was such an excellent instrument for serious learners, but SEBI decided to scrap it unfortunately.
DeleteAwesome post. Thanks so much ST.
ReplyDeleteSir good evening and thnx for the write up thnx.
ReplyDeleteSir good afternoon ,sir,In other words look at the micro trend in Daily chart,kindly update then where is minor and major trend applied thnx
ReplyDeleteThere is no need to go that higher if you are into day trading
DeleteA micro trend in daily itself is a major trend in 3M Charts
ST
Sir
ReplyDeleteHow to find median?
Sorry. I do not know much about it
DeletePlease do ask TBP
http://tradingblisspoints.blogspot.in/
ST
Sir thnx
ReplyDeleteSir good evening ,sir today eve sent you a mail when time permits kindly check thnx
ReplyDelete