30112012

Nifty gaped up above PDH. IR formed . Entered long on the retest of the level after BOF of IR low.. Second trade was also a long trade . BOF of BRN 5900.Bulls are not willing to liquidate their position it seems.

Win More, Lose Less

I had written an earlier post about the three stages of trader development. (Read). This includes defining the structure of the Market and finding ways to trade the moves within this structure. Rest is gaining practice and experience to execute your methods without hesitation.

So it comes down to a method with an edge and execution skill that will not erase the edge in the method. Edge is simply the positive expectancy of the method and this positive expectancy is not a result by chance. Edge is non randomness.

How do we know our selected method is having an edge?  It is very simple. The method will win more and lose less.

Win More, Lose Less

 Most of the trading methods barring few option strategies require directional price movement. We are betting on these price moves. We win by accurately assessing these directional moves. If we are right more than we are wrong in this skill, we will win more and lose less.

Win More, Lose Less

We must win more money if we are right than what we lose if we are wrong. The gain we achieve if we hit our target should be more than the loss we suffer when we get stopped out. In other words Risk/Reward should be favorable

Win More, Lose Less

We need to bet big and win more when we are right. All trading opportunities are not equal. Betting big on high probability trades and being modest on lower probability situations will boost our performance. Position management is very important in trading.

Almost all  the new traders focus only on the first thing as they want to be right always and out smart the market. Real break through in trading will come once you shift your focus on to the other two.

29112012

Nifty opened above PDH and moved 90 points. I was not able to capture any move.There was no reliable signal to enter early. Being expiry, I was not comfortable to initiate a position around BRN 5800

27112012

Market gaped up above PDH and spiked without giving a pull back. IR formed.Expectation was a channel move. Did not enter on first pull back as it was below BRN 5700.BPB of BRN gave a long signal.

Trading the Illusions

Most of the traders are trying to trade the illusions. Once you understand the framework within which the price moves everything becomes clear. Defining the structure of the Market is the first step to trading consistency.

26112012

Nifty Opened just above PDH . First bar acted as IR. FTC above IR High gave a short signal . Entered on break of PDH. TP when PDC held. Another short below PDH on TST of HOD suddenly reversed. Stopped out .Missed the BOF of HOD.Nifty traded within a 20 point range the whole day.