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SL_Calculation

Page history last edited by NimblrTA 1 month, 3 weeks ago

Stocks Breakout from Indecision Zone Candles.

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What are the Indecision Candles?

Ans: Those with Body Height less than 50% of Candle Height.

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Hence, Stop Loss is placed below or above Indecision Candles.

 

How Stop Loss Can Be Fixed


 

 

Stop Loss Calculation

 

Set Monthly Stop Loss

 

Here use 238-(238)*(1/9)=211 as Stop Loss

 

 

 

 

VST, CMP 2692 .. was recommended @ 1960 in Aug16

Strong financials, money parked in safe heaven linked to 7-8 yrs stable performance. Such stocks are easy to monitor via Stop Loss.

 

 

#CEAT Case Study using Breakouts + CCI 34 Daily >+100 with Entry/Exits ..Exits are by use of Stoploss placement

 

Use of Elliot Wave for SL

At 780, it would mean Overlap with earlier top .. some thing seriously wrong ! .. if not the rise will maintain ... ! and there will be no reason to think of EXIT required any time!

Fundamentally ..an excellent stock .. low float .. historically price takes support on 55 ema .. its enough .. partly may be ... for years ... its in my PF .. !

 

 

Stop loss makes a safe exit

 

Stop Loss placement is good for brokerages not for traders. It is good during some phases of the day

 

Stop Loss For Futures

 

 

Intraday Usage

Breakout on the stock  

 

Monitoring Trade System

 

How stop loss and targets must be made to work for you.

Trailing SL's are good to exit than targets. Lets see how this goes in the next 30mins

 

For Intraday:

How to Fix SL for Intra Day was a question asked to me? The Real Answer ! SL is fixed based on volatility of the stock i.e. Difference of H/L as a % to Open ! In NimblrTA it is referred as DTR and DTR is fixed on the basis of %Margin. Higher the Margin higher the DTR

 

Margins many a times is not known and therefore it is suggested to consider the Higher Time Frame Candle High or Low less @ 1% but that to me is not very convincing.

 

A DTR based SL System however will never satisfy one with a lucrative RR for money management but I opt to mitigate Risk.

 

Traders must also appreciate that a lucrative RR if given the time could be achieved but not with limited time as in intraday

 

In a DTR based system if the margin is 0.25% like in HDFC, the DTR is 2.23%. SL is placed @ 2.23% above High or below Low for a Sell or Buy Trade respectively. Margin - DTR is as below

 

This compliments very well with the Exchanges who increase Margins with rising volatility in a stock and is a feature one must check every time we enter a trade.

You may even chose to follow previous day DTR and place SL . One common argument against a distant SL is less trade volume/value and thereby gains.

But your experience will tell that most of the Big Money made is by staying in the trade for the optimum period to maximize gains. Lower volumes can lower stress too - a positive when you trade.

One cannot be keeping the same % of proximity of SL for all the stocks. Margins fixed by exchanges and previous day DTR would prove to be very helpful to you. Try doing this and you will experience been stopped out 1 out of 20

If you are trading by yourself online a distant SL helps you to feed a Target too depending upon SLTP Trigger % as both Margin % plus SLTP% together block your funds and contribute to the actual Margin paid.

 

SL on Intraday with volatality

Volatility & Stop Loss. . Here’s what happened in Reliance. Single 5min candle H/L 1272/1252 i.e 20pts 1.57%. Its full Day’s H/L Diff was 24.90 1.96% . To be safe from such whipsaws, how far should be the Stop Loss?

Qn: The stock is in no momentum zone, maybe that's why we see these whipsaws. A general HTF 30-0.382% (Aura constant included) can be a good SL in general

Ans: Would not have taken care of this problem .. simple solution .. and I keep SL 2% away from High or Low and I can afford bcoz of high exposure .. in doing so exposure may come down from 95 to 45 .. but fine, one way of risk management

 

Comments (2)

Siddharth Khunteta said

at 10:23 pm on Apr 3, 2018

Qn: If we are dealing with daily chart, what timeframe should we consider for placing SL and sighting nearest non-strength candle ? Daily, Weekly or Monthly ?

NimblrTA said

at 8:17 am on Apr 4, 2018

Stop Loss is always on the 'next' Higher Time Frame, below the non-strength candle (Weekly in this case)

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