How to Learn Day Trading

Replica from Nifty Nirvana. Thanks for the Guidance.

http://niftynirvana.blogspot.in/2012/02/how-to-learn-day-trading.html#comment-form

How to Learn Day Trading

If you are ready to take a little effort, you can learn it really fast.

I assume you have some basic knowledge.

First thing you have to do is selecting your time frame. If you cant stand the Formula 1 speed of 1M chart select 3M or 5M.

Now decide how many points of Nifty you need to capture. If it is 10 add another 5 points for commission and slippage. So you may need minimum 15 point move.

Next step is to open your historical chart. Mark all the 15 points or above moves on this chart. Note down or better mark on the chart the following

1. Location from where the move started ( HOD, LOD. PDH etc.}

2. Location where the move ended

3. Locations where the move paused

4. Notice and note down the pattern which triggered the move (BOF, TST, BPB etc)

5. Mark where you could have entered with the least risk. With a minimum RR of 1:1

6. Decide on your high probability patterns and high probability locations

Do it at least on 100 charts. The more the better.

Now go live with Mini Nifty. Stick to your locations and patterns. When in doubt stay out. Don’t chase. Maintain strict discipline. Slow and steady will win the race.

Don’t worry if you cannot invent  You can always do Reverse Engineering

06 Oct 2015, Tuesday

Prices opened Full Gap Up on the day and initial Bias was UP. Took first trade Long in the direction of Bias but the Location was not an DP. Closed the trade with a small loss of 7 Points (including Brokrage). Prices Re-tested the PDH and RN DP. It was a Good setup to enter short but did not enter as I was already in long position.

Prices approached to the MSP-8125 and the most of the bars were overlapping bars which shows a range in market. Entered Long on Second BOF of Day Low and MSP-8125. Prices moved up and after breaking the MSP prices came down rapidly and hit my SL.

By this time, I noticed that prices are moving in a descending channel and decided to buy on BOF of Channel Low Line. BOF of Channel Low happened and Entered Long. Covered the Position on FTA.
 

05 Oct 2015, Monday

On the day I traded with the On-Going Analysis and Trading Sheet Process and as we can see from charts that I took the first trade long on BPB of RN and covered it once the BO candle closes. Thereafter I went for some work and came back near about in noon. Till than I was following my set processes and when I re-joined then I left the on-going analysis apart (refer the On-Going Analysis Sheet of the Day) and did not wish to log into that and took three counter trend trades (Short) one after another and bring my account from profitable to loss account.

 

Lesson Learnt -

 

1. Follow the Process as it controls the urge to enter immediately without any thought which is a bad habit in me and must be controlled. This is the only procedure by which it can be controlled.

2. Always trade in the direction of Current Market Bias.

15 Sep 2015 & 30 Sep 2015 - Method of Improving Discipline During Trading

The above charts are showing trading done by me on 15th Sep and 30th Sep 2015. I have taken a long time to accept the reality of the act done by me which is quite clearly visible on the above charts. I badly hit my accounts and my confidence to trade too. It took me a long to analyze my mistakes and pen down those mistakes and then to find a way to check these mistakes. The details are as below:

 

15th Sep 2015 - Mistakes

 

(a) Lack of Discipline

(b) Entering into Trades one after another seems like doing revenge trading and trying to chasing the market instead trading

(c) Lack of Trade Management

(d) Money Management is Totally Missing

 

30th Sep 2015 - Mistakes include the above and below line

 

(a) Trading against the market Bias.

 

I recognize the above mistakes needs to be corrected and after various + and - processes, finally I developed a process which automatically prevents me for doing these mistakes. The only requirement is to update the data in the excel file and it will automatically calculate the data and I need to analyse and refer this data on regular basis during the session . The snap shot of the process is as follows:

 

On-Going Analysis:

The sheet is self explanatory and inspired from the chart technical.blog.com. It will be used to log the on-going analysis during trading sessions so that I can concentrate on the well determined DP and I should not chase market one after another trade.

 

Trading Sheet:

 

It will be used to log the trades to know and get updated about the current account status so that I can judge and take a effective decision on upcoming trading session. It also includes a "Trading Feasibility Check" Module which gives me a correct idea that if my SL get executed then what will be my account status and on the basis of that I can make the effective decision.

 

 

I am sure that if I will follow the process then I will skip the above mistakes automatically.

 

Happy Trading :)

29 Sep 2015, Tuesday

 

Market opens full gap down and trading in a tight range of 7720-7740. BO of IRL occurs at 1133 and prices went down till 7708. Thereafter prices pull back to the BO level. Went Short at Pull back as shown in chart Although the BRN-7700 was just near. Exited on SL execution.

 

No other trades taken today due to high volatility. Due to high volatility, my SL will be wider and any loss due to SL execution will impact badly to my account.

14 Sep 2015

 

Market opens within previous days range and just near to PDC(7823) . First candle was a spin candle with high volume of above one lakh which shows a high degree of indecision in the trader. Next candle was a bearish low range closed candle and indicates the BOF of PDC. Prices moved in downtrend without a pullback to PDC and did not give opportunity to enter short at weak pullback to PDC. Prices moved to 7765 and made a IRL at 7765 at Point B. Prices bounced back to test the BRN - 7800 at point C. BO Occurs at BRN and there was an opportunity to enter on pullback of BOF of BRN which I did not took as I was away from screen. Prices again went down to IRL-7765. Prices failed to go lower than the IRL and FTC signal occurs. Long Entry opportunity occurs when prices went above candle E. I did not took the trade as still I was not on screen. Prices went till Point F and did not touch the BRN-7800. Prices again went down and stopped at Point E and resisted to go beyond the point E. This gave me a confidence that bulls are resisting the prices to go down beyond the point E. I entered at 7791 when prices went above point F and was expecting a BO of BRN-7800. Although the entry was late as my SL was below point D i.e. 7765 which was a very wide SL and if prices would have come down then my accounts were in big red. Prices make a good move upside thereafter and a strong up-move occurs in terms of BO of BRN. My Target was the point A (IRH-7830. I exited trade at 7833 when spin candle with big tails appears which shows the weakness in the up-move. I left the screen thereafter as I will have to move for some urgent work.

 

Happy Trading!

05 Aug 2015

 

Market opened within Previous day range near to PDC. First Candle Tried to close the Opening Gap and Closed near its high which shows Bullish Sentiment. Traders tried BO of BRN 7800 at candle A with high volume, but no follow through in the next candle and the volume of next candle was also low. Traders once again tried to BO BRN 7800 at candle B and prices succeeded to close above BRN with high volume and prices make a IRH.

 

Prices then entered in a range and most of the candles were overlapping. I could see the pattern Absorption as mentioned in the Structure and Pattern Book. Entered on the second FTC. Target was PDL whereas prices bounced back from previous swing low. Covered just below BRN

 

Price then BO on BRN 7800. Entered Long at weak pullback test just after the BO candle with low volume. Covered the Position when a spin candle with long tails appear after a strong bullish candle which appears a great indecision among the traders for this price level.