Tuesday, January 24, 2012

Trading after a target is Hit

A target of 5070 came from an ascending triangle pattern in the Nifty which broke out at 4800. This target has been touched and crossed.

The long trade started at 4800 should be closed when the target was met. What should a trader do now, after he exits the position? This question arises because the pattern under trade is now complete so new patterns/trades will not come quickly.

Among the various suggestions that come to me:


1. Take a well deserved rest.

2. Start a search for new patterns, in different time frames.

3. Stay with your time frame , be alert to any new patterns that develop.

4. Switch to another trading method, i.e. from patterns move to moving average crossover or RSI levels.

What do readers say?




9 comments:

mavericktrades said...

take a well deserved rest and be alert to any new patterns that develope within your time frame

Rushabh Shastri said...

IT stocks SHOULD do well, for the coming expiry, $ should reach 54+, finger croos 58 too.....

Neeraj Malhotra said...

1) is not applicable to a beginner like me who kept on suspecting this rally and looking for a short position on every bearish reversal on 60 mins chart :-)

The system that I follow does not suggest me to take a long position at this stage.

I would probably go with 3) and wait for a more convincing down move before shorting the market further.

Thanks
Neeraj

Kuldeep.rk said...

Dear Sir,
In my view, since NF has closed above 1st Dec close, bias would be more to go long. Hence one should open long trade if markets open flat to positive, with stop below close of that day. (5075-80) Expecting NF to test dntrend line (5275-5300).
In case NF opens -ve, we should initiate short near 5100 ( as 1st Dec acting as strong resistence in this case) with Stop above today's high. Target 4900 (38% fibonacci level)

How ever, request your comments as we I might be missing many vital points, which you can see from the charts..

rgds,
kuldeep

Tomichan said...

Master,
i have lost the 30000 invested one month ago eventhough the 5000 minifty put rests with me. So, i am choosing the first option. Taking a well deserved rest! I may join the party from 2nd february onwards. I am following master for the last one month and has delivered the best among all the analysts around us through his down to earth heartening style. Unfortunately, i followed my imotions in trade. Of course my next mission will defenetly be along with the master.
As a reader, i doubt why not take a long position since the 5100 barrier broken. And without no suggestions available now, (i suggest) one may leave nifty in 4980 - 5210 range.
Market imotion - RBI PLEA has ended for the short term. Market has priced in the news ever since the news came out 3 weeks ago. That cushion is emty now. Major results also maturing. Then no news for a downfall either. Good for a range bound market. But news will come from nowhere. So be catious and take a well deserved rest for time being for the new patterns to emerges out.
Salute master.

EquityMovez said...

Sir,
Out of 650 points Nifty rally. 450 points had come on last 4 Tuesdays, i.e. 3rd, 10th, 17th and 24th (today)[Don't know by destiny or DESIGN]. So it's simpler that we wait for 31st [next Tuesday].

Regards

Equitymovez@gmail.com

Naran said...

5-DAY RSI 92 AND 14-DAY RSI 72.
INDICATES NIFTY ENTERING OVER BOUGHT ZONE.

K_Vir said...

Thanks for your valuable thoughts. We look forward to these quite eagerly.

In my opinion, best option is to take well deserved rest, stay tuned to the selected time frame and wait for new pattern to emerge. Off course, one needs to have more than one "proven" system (but not more than 3) to remain alert to changes occurring in market and grab the right opportunity...

By the way, I observe lot of newbies jumping in the F&O without sufficient study. My suggestion to all those friends is to spend sufficient time in market (may be through MF, direct equity) and learn to take the shocks of market, study the books / blogs from experienced people like you before taking up F&O...

sanraj said...

ON daily charts RSI has reached over bought levels. I will go short the day when FII inflows trickles down.