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Body of

the Open -
candle Close

Open 564
Close 583

19

Range of
the High -
candle Low

High 588.95
Low 561.6

27.35
50% 13.675

Exciting Candle = Body >= 50% of the range

ow to draw Demand & Supply zones on charts?

---- > To draw a Demand zone or a Supply zone you require 3 things -- >

Leg In - Base - Leg out

The rule is -- >

a) Legs should be exciting

b) Bases should be boring

Buying Patterns -- > Drop-Base-Rally & Rally-Base-Rally

Drop-Base-Rally -- Leg in - Red


Base - Could be red/Green
Leg Out - Green
Rally-Base-Rally -- Leg in - Green
Base - Could be red/Green
Leg Out - Green

Exciting Candle = When Body > 50 % of the range

Boring Candle = When Body < = 50% of the range

Drawing the Zones -- > Plotting a Zone will require 2 Lines

Proximal Line - One which is closest to the current price

Disal Line - One which is far from the current price

Plotting Demand Zone -- > Highest body of the base & Lowest wick of the Base

4 Set ups that we learnt Yesterday :

1) Buying Set ups -- >

a) Rally-Base-Rally

b) Drop-Base-Rally

2) Selling Set ups -->

a) Drop-Base-Drop

b) Rally-Base-Drop

Sell Patterns ----- >

a) Drop-Base-Drop
Leg In - Red
Base - Red/Green
Leg Out - Red

b) Rally-Base-Drop

Leg In - Green
Base - Red/Green
Leg Out - Red

Drawing Zones --

Distal Line - Highest wick of the base

Proximal Line - Lowest Body of the base

Fine tuning of the zones --- >

Exception Rules --

Drop-Base-Drop Pattern - If leg out candle wick is higher than basing candle wicks shift your

Rally -Base-Rally Pattern - If Leg out candle wick is lower than basing candle wick Shift the

Rally-Base-Drop pattern - If Leg in Candle wick is higher than basing candle wick shift dista

Drop-Base-Rally Pattern - If Leg in candle wick is lower than basing candle wick shift distal
ck of the Base
candle wicks shift your distal line to Leg out candle wick

ng candle wick Shift the distal line to leg out candle wick

candle wick shift distal line to Leg in candle sick

candle wick shift distal line to leg in candle wick.


Topics covered
----------------------

1) Different Trading styles - Hourly Inc,Daily inc,weekly inc & Monthly inc.

2) Core Strategy concept - Buy at wholesale ( Demand) Sell at Retail ( Supply)

3) 4 Basic Patterns - DBR,RBR,DBD,RBD

4) Identifying Demand & Supply levels ( Concept of Boring & Exciting candle)

5) Plotting of Demand zones & Supply zones

6) Exception Rules

7) Trends

8) Entry Types

9 ) Odd Enhancers

Odd Enhancers -
---------------------

1) How did the price leave the zone?

If price leaves the level with a gap ---- > 2 Points

If price leaves the level with No gap --- > 1 Point

If price leaves the level with 2 exciting candles --- > 2 points

2) How much time price has spent at the level?

If we have 1-3 candle in the zone - 1 point

If we have 4-6 candles in the zone - 0 points

If we have 7 or more - 0

3) How far did the price move before coming back to the zone?
If prices have travelled 3:1 ----> 2 Points

------------------------------ 2:1 -----> 1 Point

------------------------------ 1:1 ------> 0 points

4) Is my level a Fresh level ?

If my level is Fresh ---- > 2 points

If my level is tested once ---- > 0.5 points

If my level is tested multiple times --- > 0 points

The rule is --- > For a zone to be called as a good zone you should have a minimum score of 6

Planning an options trade is no different than planning a trade in Equity


markets.
Prefrably options trade should always be planned on time frames of 60 mins &amp;
higher.

Location on weekly chart


Trend on Daily chart
Execution on Daily or 60 mins.

Fundamental Rule – Trades will always be planned on stocks.We will never


plan an options trade in options chart itself.
ave a minimum score of 6 points.
Bull --- >

Either Buy Calls or Sell puts

Bear ---- >

Either Buy Puts or Sell calls

Option Buyer - Limited Loss & Unlimited profit

Option Seller - Limited profit & Unlimited Loss

In real world of options it is Option SELLERS & not "BUYERS" that make money consist

Option premium is made of 2 components --- >

1) Time Value

2) Intrinsic Value

Note ; For your call option to make money,it is just not sufficient for markets to r

How will you decide whether to Be a buyer or a Seller of Options --- >

Concept of IV i.e Implied Volatility will help us in understanding whether to be a b


------------------

There are of 2 types pf volatilities -- >

a) Historical volatility - Gives you an idea of how prices have moved in the past

b) Implied Volatility - Gives you an idea of how the prices are expected to move in

Trading Rule : -

a) If IV > HV the option prices are said to be over valued --- >It makes sense NOT t

b) If IV < HV the option prices are said to be undervalued ---- > It makes sense NOT

LIQUIED UPTION
AXISBANK
BANKNIFTY
BHARTIAIRTEL
BHEL
CAIRN
DLF
HCLTECH
HDFC
HDIL
HINDALCO
HINDUSTANUNILVR
ICICIBANK
IDFC
IFCI
INFY
ITC
JINDALSTEL
JPASSOCIAT
LT
MCDOWELL-N
NIFTY
ONGC
PFC
PNB
RANBAXY
RCOM
RELCAPITAL
RELIANCE
RELINFRA
SBIN
TATAMOTORS
TATASTEEL
TCS
hat make money consistently.

cient for markets to rally.But markets should rally with a fast pace

ding whether to be a buyer or Seller

e moved in the past

e expected to move in future.They are expecations of the people.

>It makes sense NOT to buy but SELL options.

- > It makes sense NOT to sell but to BUY options.


Demand Zone
Scenario No 1: I am an HIT and I have entered the trade on 5 mins.
a) There is an opposing level of supply on 5 mins where you want to exit
b) There is no opposing level of supply on 5 mins ????
c) There is an opposing level of supply on the higher time frame(&gt;5 mins)????

******* Reward : Risk is going to be most critical

If there is an opposing level of supply or demand exit at that level and book
profits
If there is no opposing level of supply or demand on the same time frame then let
profits run and either book partial profits at 2:1 or then book final profits at a
higher time frame level
If there is a market which is making all times highs or lows after entry divide this
trade into 3 bracket orders
1 st Bracket order  Exit at 2:1
Bring the 2 nd and the 3 rd bracket order at 1:1
2 nd Bracket order  Exit at 3:1
Bring your 3 rd Bracket order at 2:1
3 rd Bracket order  Exit at 4:1 or greater
Wait till get your 4:1 greater or get ready to get stopped at 2:1 for a profit….
Define a risk limit per trade = Rs 1000 per trade
3 Bracket orders  You are only going to loose 1000 rupees
One order for 2:1  Rs333
One order for 3:1 = Rs333
One order for 4:1 or more  Rs333
Life of an hourly income trader
1. Need to go through all the 24 CTP sessions and watch the recordings at
least once or 2 times
2. Submit your personal trading plan to your mentor
3. I will attend all the live trading sessions during the day
9:00 am - 10:00 am – Focus more on Hourly Income and Daily Income Trades

12:30 pm – 1:00 pm – Equities Trading


1:30 – 2:00 pm – Commodities Trading
3:00 – 3:30 pm – Closing Equities Session
5:30 – 6:30 pm – Commodites
9:00 – 9:30 pm – Hourly Income and Daily Income
Time Allocation : 1 hour analysis + 2-3 hours analysis on the weekends
Order Placement : During market hours + After market hours orders
Bracket + Trailing SL orders
PS: After market bracket orders will be placed from 11:00 pm – 8:00 am in the
morning + Weekends

Strategy building for hourly Income Trader

1. Identify the purpose for trading?


Short term Income
2. Define your trading style?
Hourly Income Trading
3. Define the time frames for your trading style?
Trading Style Curve/Location/Bi

g Picture

Trend Zones
HIT 60 mins 15 mins 5 mins

4. What strategy I am going to use to identify my trend ?


We are going to use the 50 Simple Moving Average using the clock method
5. Do you want to incorporate volatility in your trading?
Yes – Aggressive Trader
No – Conservative Trader
6. Do I need to takenfundamental news into account?
No (Except on the day of earnings, Credit Policy and economic data )

7. How I am going to quantify my zones?


Odds enhancers (Zoning Time Frame only)
Score of at least 8 or more for Type 1 entry
Score of 7 will allow you to only take a Type 2 or Type 3 entry
8. What are some of the secondary tools that I would use for trading HIT
trades?
1. Daily ATR
9. What is the type of entry that I will prefer to take my HIT trades?
I will take trades only if my zone(DZ or SZ) scores at least 8 or greater for my odds
enhancers Limit Entry (Type 1 Entry)
10. What is going to be my stopping point for HIT?
2% of Daily ATR
11. Targets
a) I will have 2 targets - 2 separate bracket orders
b) I will have 1 target - 1 bracket order

12. Where I am going to be taking my exits after trade is triggered(Booking


Profits)
a) Opposing level on the same time frame as the entry - 5 mins
b) Opposing level on the higher time frame(Trend time Frame) – 15 mins
Multiple Time Frame Analysis
Curve/Lo
Trading Style cation/Bi Trend Zones
g Picture
Upto 15
Hourly Income 60 mins 15 mins mins
Upto 60
Daily Income Daily 60 mins mins
Upto
Weekly Income Weekly Daily Daily
Upto
Monthly Income Monthly Weekly Weekly

Aggressive Vs Conservative Trader using Curve and Trend Analysis


Advance Scanning Techniques
Top to down approach
Technical Indicator based Scanning
Top to down approach (RELATIVE INDEX TOOL):-
1. Long :- Stock which stronger than nifty
2. Short:- stock which weaker than nifty
Scanning time frames for different trade types:-
HIT - THREE DAYS
DIT- ONE MONTH
WIT- THREE MONTHS
MIT- 6/12 MONTHS

Technical Indicator based Scanning


Moving Average Scanning:- We are going to use setup of three moving averages.
10ema, 21sma, 50sma.
Find attached screenshot of scanner below.

DIT Long:- we can look for a stock which is above 10Ema daily and approaching daily de
DIT Short:- we can look for a stock which is below 10Ema on daily and approaching dai
WIT
Long: -
we
can
look
for a
stock
which
is
above
20/21s
ma on
daily
and
appro
aching
daily
dema
nd
with
locatio
n
analysi
s.
WIT Short: - we can look for a stock which is below 20/21sma on daily and approaching
OOL):-

oving averages.

d approaching daily demand .


y and approaching daily Supply .
daily and approaching daily Supply with location analysis.
Anticipating the Market moves using Floor pivots - >

Pivot points are statistical tool to anticipate the support/resistance levels


with a high degree of probability

When you combine them with candlesticks they would be even more powerful.

Pivots are based on mathematical calculations using previous days High,Low & Close.

Pivot = Average price ( Thats the price at the center)

Above the pivot = Resistance 1, Resistance 2 & Resistance 3

Below the Pivot = Support 1, Support 2, & Support 3

The pivots trading strategy equally effective in Equities.Commodities & currency mark

The reason they wors so effectively, is because a lot of traders have been using them
them mathematical points of reversals.

Many times you will observe these pivot levels coincide with a high probability Deman

Basic HTML view


1) Judging the general mood of the Markets -- >

Prices above the pivot -- > Bias Bullish -- Tilll the R1 or the nearest supply zone
buy for HIT & DIT.

Prices are beloe the pivot -- > Bias would be bearish -- > Till S1 or S2 levels.

2) Using pivots with demand & Supply -- >

R1 level coinciding with Supply zone --- > Sell

R2 level coinciding with a Supply zone -- > Sell

S1 level coinciding with a Demand zone -- Buy

S2 level coinciding with a Demand zone -- Buy

PP -- > Prices open above the pivot they would normally retest the pivot once before

PP --- > Prices open below the pivot they would normally retest the pivot before goi
Trading Strategies Using Pivot points :

There are different ways of using pivot points.You have to use them based on the broa

1) To judge general mood of the markets. ( on a regular basis)

2) Pivots can be used as a tool for Breakout. ( Breakout principle)

3) They can be used to anticipate the points of reversals.( OTA core strategy)

Judging general mood of the markets :

Whenever the markets open only 3 things can happen

They can open at Pivot

They can open above the Pivot ---- > Stay above the pivot for app 15-20 Mins with bul

They can open below the Pivot ---- > Stay below the pivot for app 15-20 mins the bias

On exceptional Days they will open above R1 or R2 & Below S1 or S2


istance levels

powerful.

ys High,Low & Close.

dities & currency markets as an oods enhancer

s have been using them since ages.You can call

high probability Demand or Supply zone

he nearest supply zone.Strategy should be to

l S1 or S2 levels.

the pivot once before going up.

t the pivot before going down.3


them based on the broader market sentiments.

core strategy)

pp 15-20 Mins with bullish candles the bias for the markets is positive

pp 15-20 mins the bias would be negative.


1. It is very important to check the last candle close for the month
Err:501
2. Following time frames to be looked at :

Type of trading
style

Curve Trend Zones

Monthly Income
Trader

Monthly Weekly Daily

Curve Analysis for monthly


1. Plot the closest DZ and SZ which is “FRESH”
2. Identify High, Eqb and Low
3. Will help us to be a Buyer or a Seller for that stock

Trend Analysis using the 50 SMA


When the price is in Eqb we are going to be using the Trend Analysis to determine
if we are in an Uptrend  Focus is on Long trades
Downtrend  Focus is on Short Trades
Sideways  We stay away and do nothing until the trend changes to the upside
or the downside
Zone Analysis
1. If we are High on the curve plot supply zones and if we are low on the curve
we are plotting demand zones
2. Apply the odds enhancer score and quantify where you will take your entry
3. If price is far away from your entry point we will be setting alerts in Trade
Tiger for reminding us regarding our zones
Process for identification of monthly income trades

1. Plot the Dz’s and Sz’s on the Nifty, BankNifty and USDINR  Daily Time
Frame
2. Use the Ignite Scanner or the Relative Strength tool within Trade Tiger to
identify Strong Vs Weak Sector  12 month period
3. Find the strong stock within a strong sector and find a weak stock within
the weak sector with respect to the Nifty….
4. Create a market watch of Strong Vs Weak Stocks based on relative
strength and apply the core strategy rules to the above stocks….
Life of a monthly income Trader
1. Follow the pre-market and be aware of all that is
happening on the news front and the global markets front
2. Use the Ignite scanner to find strong Vs weak stocks with
respect to the Nifty
3. Create a market watch of strong stocks and weak stocks
4. Compare the strong stocks with the Nifty
5. Compare the weak stocks with the Nifty
6. Ideally for a monthly income trader you want the stock
and the Nifty index to be at a level(Demand Zone/Supply
Zone)
7. If the stock is in a Demand Zone but Nifty is not in a
DZLook at the sector the stock belongs to Long
Trade(Futures or take delivery of the stock)
8. If the stock is in a Supply Zone but Nifty is not in a SZ
Look at the sector the stock belongs to Short
Sell(Futures)
9. Multiple time frame analysis 
Trend is likely to bend its end
Buyer or a seller of that stock or index or sector?
Style of
Trading

Curve(Higher
Time Frame)

Trend(Intermediate
time frame)

Zone(Lower
Time Frame)

Monthly
Income

Monthly Weekly Daily

Entries We want to take entry slightly before the proximal


line
TargetsOpposing Levels (Demand or Supply)3:1 Ideal
The time frame where you have you S.E.T
What if there is no opposing level? As a thumb rule exit 50%
position at 3:1 and then trail your SL until you get stopped out
for a profit  “Let your profits to the maximum”
You have to place multiple bracket orders for at least 2 targets
 Long Trades
Short trades  You have to take multiple lots in Futures
What if there is an opposing level &gt;3:1?
Exits (Stop Loss) 10% of Daily ATR
Another way for maximizing your profits is the following
Entry  Daily Chart
Target 1  Opposing level on the Daily chart
Target 2  Opposing level on the Weekly Chart
Odds enhancers
The most critical odds enhancers that you want to follow as a
monthly income trader are the following:
1. Freshness of a level

Freshness Price has the left the level but has never ever
come back to the level yet
2. Profit Margin
Make sure that when you a plan any trade your opposing level
should be at least 3:1 or greater
We know that for a zone to be created we require 3 elements
1. Leg-Out
2. Base
3. Leg-In
Curve  Monthly
3 months for a new level to be created
Trend  Weekly
Trend after 3 weeks
Zones Daily
At least 3 days
Agenda :
1. Creating an action plan for a weekly income trader
2. Cover the broader market analysis (Nifty, Banknifty, USDINR and Sensex) Price Action(How to
read price action)
3. Potential weekly income trade setups(Stocks, Commodities)
4. Aggressive Vs Conservative Trader
Action plan for weekly income trader:
1. Create a trading plan and follow that trading plan deligently.
(Stick with the profile that your mentor has created for you for at least 3-6 months)
2. Try to keep your position size small when you are at the very beginning of your trading journey
For example if you are doing 1000 shares per trade do only 500 shares and repeat this process for
months and tabulate all your results
3. Depending on your results being good you may increase your position size to 750 in the 7 th
month. If the results are bad then reduce your position size to 250 shares and trade for the next
2-3 months.
4. Pre-Market Routine
1. www.marketwatch.com
2. www.sgxnifty.org
3. www.sharekhan.com
4. Use the Ignite Scanner and scan for Strong Vs Weak Stocks with respect to the Nifty
a) Ignite Weekly Income Bullish_V
b) Ignite Weekly Income Bearish_V

5. Define your Multiple Time Frame Analysis for WIT

Trading Style Curve Trend Zones


Weekly Income Weekly Daily 240/60mins
6. Curve Analysis  Plot the closest DZ and SZ on the on the weekly chart and this needs to be
comprising of “FRESH LEVELS”
7. Trend Analysis  Use the 50 SMA and check the trend on the Daily Chart
If the trend is UP  Focus on Long opportunities but what if you are High on the curve?
If the trend is DOWN Focus on short opportunities but what if you are Low on the curve?
If the trend is Sideways  Wait for the trend to shift gears that is either to move up or either mov
down and only take an action once this happens
Trend travels from a Demand Zone to a Supply on an intermediate time frame and vice versa
If the trend begins from a Demand zone = It is likely to end at Higher TF supply Zone(Weekly Ch
Curve Trend Action for Conservative

Trader

Action for Aggressive


Trader
High UP Avoid the trade Shorting
High Down Shorting Shorting
High Sideways Avoid the trade Shorting
Low Up Long Long
Low Down Avoid the trade Long
Low Sideways Avoid the trade Long
Eqb Up Trade in the direction of
the trend Long

Trade in the direction of


the trend Long

Eqb Down Trade in the direction of


the trend Short

Trade in the direction of


the trend Short
Eqb Sideways Avoid the trade Wait for the trend to
change  Only trade in
the direction of the
trend
8. Plan your trade and place your MyGTD orders for Long trades and normal orders for Short
trades in Futures
9. Do not take short weekly income trades in cash markets only use futures to do so.
10. Make sure that when you plan a weekly income trade your planned reward :risk for the trade
should be greater than 3:1 ideally 4:1, 5:1 or greater will be preferred
11. Make sure that you do not risk more than 2% of your account risk per trade
12. Define your max risk limit even before you take the trade
For example your max risk limit is Rs 5000 per trade for weekly income
Hindalco  Lot Size of 2000 shares = 2 lots.
This will also depend on his SL size
Smaller the SL  Greater the number of contracts
Greater the SL  Lesser the number of contracts
*PS: Futures trades are prone to GAP Risk which means that if gap occurs in the opposite
direction of your entry you need to close the position at market at a significant slightly larger
loss than expected
ex) Price Action(How to

-6 months)
g of your trading journey
nd repeat this process for 3-6

size to 750 in the 7 th


s and trade for the next

ct to the Nifty

rt and this needs to be

h on the curve?
Low on the curve?
to move up or either move

rame and vice versa


F supply Zone(Weekly Chart)

mal orders for Short

res to do so.
eward :risk for the trade
s in the opposite
ificant slightly larger