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Monday, 11 March 2013

Todays trades 11 Mar–1 winning trade (Avoided several losing trades )

Dear Readers

Markets did not show much of an action today and was choppy of whipsawing. Typically day traders lose money in such conditions.  Also, keep in mind the fact that choppy markets tend traders to do more trades than less resulting in more losses. So strict discipline and respect for levels is important to restrict trades on such a day.

I was mostly looking at the stocks and levels as per my pre-market analysis.

Today was one of the classic days if entry was made before 15-20 minutes of settling down, all trades would have been in a loss. This is the reason that I always recommend 15-20 minutes waiting before entering any trade. If Nifty direction is not certain as today, you can wait up to 30 minutes or more.

Nifty did not cross the level of 5975 which was the resistance in my weekly outlook. So there was not much
hopes for longs.

1. ICICI – ICICI started falling right from opening and went below the 1145 level and also touched 1130 levels. Stock was oscillating between my levels 1130 and 1145, so practically no trade was possible during the day.

2. SBI – SBI made a high of 2221 within 15 minutes of opening and never crossed that during the day. The stock was only falling after that. My buy above level was 2220 which was never crossed since then. So no trade possible there as well. Chart was similar to ICICI.

3. L&T – L&T was hit by a negative news before market open, but recovered smartly from days low and
crossed 1500 with style to hit 1518. I could enter above 1500 and booked close to 10 points.

4. Cipla – My buy above level was 393 which was hit and first level of 395 achieved within 20 min of market opening. So I could not trade this. Thereafter every time 393 was crossed, the stock hit 395 and retreated. MACD and RSI was mostly horizontal in 5 min chart, the breakouts were without any volume. Second attempt to cross 395 was faced with huge selling and the stock made a low of 388.

5. ONGC – I did not enter since the high made within 20 min of market opening was never crossed. At 09:50 my level of 328 was crossed from above and the stock never recovered. No trade here.

Trading Lessons Learned

1. Wait for markets to settle even if it means 30 minutes before jumping into any trades.
2. Support and Resistance - Same day’s high is an important resistance to be crossed for longs. Same day’s low is an important support to be broken for shorts.

I will be publishing calls for Tuesday soon after US Markets close. Tomorrow will be extremely difficult to make money either way because of news. But we can try based on levels.

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