How to Set Profit Targets in Trading

Once you are in a trade the next you plan to exit: How and when do you get out of the trade at a profit? Setting targets has to be one of the most important elements of your trading strategy.
Targets can be of 3 types
Time-based—I will hold my Positions for a X amount of time Say 1 week depending on the type of trader/Investor.
Technically-based – You get your targets technically set up. You can use Pivots, Exponetioanl Moving Average, and MA or based on your trading system.
Price/Profit-based –I’ll get …
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Reliance and SBI technical View before expiry

State Bank of India
SBI has done nothing from past 10 trading sessions,Stock has become rangebound with a narrow trading range from 2780-2730.
SBI should explode either on upside or downside before expiry
As per my analysis SBI should go and touch its 50 DMA on upside before expiry as Short covering if it comes can propel the stock higher to 2900-50 levels.
MACD is showing positive divergence
Buy above 2790 Tgt 2820,2860 and 2900
Sell below 2715 Tgt 2632
Reliance Industries:
RIL has broken its 200 DMA and has give close above it for 8 …
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Nifty Weekly Technical Analysis for Week 27 Dec 2010

Nifty Daily Chart

Nifty is forming ascending triangle on daily chart which is a bullish breakout pattern. It is moving near to upper trend line of the triangle and expecting a breakout on upside in near term.
Resistance  at 6,025 (50 DMA) while Support stand at 5920 (20 DMA). On upside if level of 6,040 breaches decisively then we could see rise up to the mark of 6,080.
MACD will cross the signal line and RSI is still below 50 levels. Move …
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When to Exit Trading Position?

Money management is one of the most important aspects of trading.Many traders enter into trade without having any exit strategy which is the cause of many profitable trades going into loss.As once the Stock goes your way means the stock price is increased after your entry than you need to have levels where to exit but most of traders greed factor comes in  and they want to price to increase more and more. Let me give you an example to illustrated the scenario
Mohan buys 6000 CE of Nifty Dec series …
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Trading Calls — ABG Shipyard and ABB

ABB Ltd
ABB has formed a base around 750 levels and facing resistance at down trending channel at 810.
MACD is showing positive divergence.
Buy above 810 Tgt

ABG Shipyard
ABG Shipyard is forming a ascending triangle formation with rising trendline from bottom and a vertical trend line joining tops.
Also the 50 DMA @ 408 is also proving a tough resistance to crack.
Buy above 408 Tgt

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Will Nifty break 50 DMA ??

Nifty Daily Chart

Nifty got resisted at 6025 ie. 50 DMA today and corrected till 5 EMA @5963
As I discussed in Nifty Weekly Analysis we will face a tough resistance around this level and break of this levels with volume can move nifty higher.
As on Daily chart we are forming higher highs and higher lows which is bullish pattern but unable to break 6025 ie  50 DMA is a negative sign for Bulls.
Volume are on lower sides as FII are having very less participation in market.
For Tomorrows Trading 2 Imp levels …
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Will Bank Nifty Break Nifty of Trading Range?

Bank Nifty has been under performing Nifty from past few trading sessions and if Nifty wants to get out of the range of 6070 than we will require the help of Bank Nifty.
As financial form the major component of Nifty we require there support for getting out of range.
Bank Nifty Daily Chart
Bank Nifty is forming a Higher Low and Lower high kind of formation with an ascending triangle formation.
Till Bank Nifty is unable to close above 5 EMA 11,373 and 5 EMA HIGH 11,515 Bank Nifty will remain in Downtrend …
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Nifty Weekly Levels for 20 Dec

Nifty Long Call Initiated by Nifty Trading System [Click on Link to Know more about Nifty Trading System]
Nifty spot has crossed 5 EMA over 20 SMA on upside with MACD also showing positive divergence.
As stated in Post we can initiate longs in Nifty with SL of 5855
Nifty Daily Chart
Nifty on Daily Charts has formed Higher Low formation from low of 5690 and 5721 which is having bullish implication.
On Upside if we are able to cross 5954 on closing basis we can see a rise till 50 DMA @ 6040 and …
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Trading for a Living

How to make money trading stocks/Commodities
(a) Identify the reason for the trade
(b) A Stop Loss
(c) A profit target or trailing stop mechanism
(d) The point at which you accept that the trade is not working even if the stop did not hit.
(e) Number of shares / contracts that you will hold. Keep in mind that your loss on a single trade should not be more than x% of your capital (you decide the x%)
(f) maintain a trading journal in which you write every evening, without fail.
As a sportsman(So too as a …
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How to use Stop Loss in Trading

When markets are:

• Volatile
• Overbought in Short Term
• May Reverse from the current trend as per technical

Most common term used by traders/analyst is:

Tighten your Stop Loss/Use Trailing Stop Loss

Stop loss order is an order to close position if/when losses reaches a particular point. In other words this is an order by which you can decide the maximum loss that you are ready to accept. Here we are going to discuss only Stop Loss Order regarding Day Trading, but the same principle can be used for Swing Trading or Long …
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Nifty Future and Bank Nifty Technical levels for 15 dec

Nifty Future

Nifty is posting a rally from the low of 5721 Will Nifty Bounce as  I showed technically that we did not break the low and positive divergence on RSI played there part fueled by very good IIP numbers.
Market always makes a move that causes maximum pain to maximum people and consensus was on bear side and market proved all wrong.

Coming few 3 days of the week should be crucial as Nifty will test the real power of Bulls near 50 DMA @6045  and than at 6070
Close above …
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Trading Calls:Reliance and Educomp

Educomp Solution

Educomp Solution looks good as it is extremely oversold on daily charts and near its support area of rs 502.
RSI is showing positive Divergence.

Buy above 525 Tgt 531,540 Sl 516

Reliance Industries
Reliance Broke its 200 DMA @1036 today which is bullish for Reliance and Nifty also as it has 12% weight age in Nifty.
RIL is now facing resistance at 50 DMA @ 1046 now and once that’s crossed we can except move till 1100.
Buy above `1046 Tgt

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Techical and Investment Calls:Hanung Toys,ALLABHAD BANK and WIPRO

Market is a place where all kind of rumors born in pessimism and some quarter take advantage in hammering the stock in the name of somebody else for personal gains.
If the valuation is right even if somebody is involved the stock will find support See that you do not enter at wrong valuations.

Hanung Toys
Hanung Toy has been hammered from a high of 414 to a low of 171 in few trading sessions on account of price rigging.Here i would like to mention that nothing has …

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Nifty Weekly Technical Analysis for Week 13 Dec 2010

Overall during the week ended 10th December 2010, the market witnessed a steep slide, with small-cap and mid-cap stocks taking a beating on concerns over regulatory crackdown on companies indulging in price rigging and an ongoing investigation into telecom corruption scandal.
We anticipated both downside and upside in below posts

Nifty Ready for Bounce

Nifty Weekly Analysis

Next week looks interesting as we have the advanced tax figures of the Indian corporate for Q3 FY11 will be closely watched for any indication on the quarterly performances and RBI …
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Trade with STOCHASTICS

Developed by George C. Lane in the late 1950s, the Stochastic Oscillator is a momentum indicator that shows the location of the close relative to the high-low range over a set number of periods. According to an interview with Lane,
The Stochastic Oscillator “doesn’t follow price, it doesn’t follow volume or anything like that. It follows the speed or the momentum of price.As a rule, the momentum changes direction before price.” As such, bullish and bearish divergences in the Stochastic Oscillator can be used to foreshadow reversals. This was the first, …
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Nifty under Bear Attack ?

Monthly Chart

5 Monthly EMA@5750 if broken we are heading towards 5500


Weekly Chart
Near trendline support and there is lots of panic in market am advising all my readers to use this oppurtunity to deploy cash because bounce back will be fast and furious.
Daily Chart
All are self explanatory charts
Support at 5750,5697 and 5627

Mid Cap Index is down 10% from November Low while Nifty has not breached the low.
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Reliance Technical View near 200 DMA

Reliance Industries

Reliance industries is forming a parallelogram pattern with formation of Higher Top and Higher bottom formation  on daily chart in short term time frame.
Reliance was the savior  for Nifty for past 2 days when banks were bleeding heavily due to crude rising above 90$ which was negative for Banks but positive for Reliance.
Positive divergence has been observed in MACD with a positive crossover.
200 DMA is considered a defining territory for Bulls and Bears.Above 200 DMA bulls exsits and below that bears have power
RIL is having the same case …
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Trading Calls on Bank Nifty,TCS and Sesa Goa

Bank Nifty

Bank Nifty forming a ascending triangle formation with upper trendline acting as resistance with 50 DMA acting as resistance and lower trendline acting as support
Bank Nifty is a buy only above today's high and Sell below lower trendline level

Buy above 12429 Tgt 12582 and 12734

Sell Below 12000 Tgt 11898 ,11746 and 11480

Sesa Goa
Sesa Goa is forming higher top and higher bottom formation on daily chart and with a good positive divergence in RSI
Buy above 305 Tgt
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Technical Levels on HDFC Bank,Cipla and Reliance Capital

HDFC BANK

HDFC Bank is having trading range between 2260 to 2400 where it gets resisted by upper trend line and on downside gets support at lower trendline.Daily chart of HDFC bank is displayed below with upper and lower trend lines.
RSI is showing a clear negative divergence MACD is showing positive crossover.
Stock has formed a DOJI candelstick formation with a ambiguity within buyes and sellers to decided the furthur course of action for the stock.

Buy above 2400-2406 Tgt 2417,2434 and 2448 Sl 2388

Sell below 2389 Tgt2378,2361 and 2350 Sl 2407

Reliance Capital

Reliance …
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Nifty Weekly Technical Analysis for Week 6 Dec 2010

Nifty after 3 weeks of downfall which was overshadowed by scams and technical correction. I anticipated a bounce back in coming week in last week Nifty Technical Analysis  [Click on Link to Read about it] .
As anticipated nifty gave a good bounce back close to 4% on weekly basis,on the news Indian economy growing at a robust 8.9% YoY growth in Q2 September 2010.

Nifty Daily Chart

Technically, last few day’s chart of Nifty is showing symmetrical triangle pattern which is bearish breakout pattern if lower trend line breaks. …
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Ego and Trading

By: Terry Ashman

If you take a long or short position in the market, the market doesn’t care what price you got in at. It doesn’t care what price anyone got in or out at. It doesn’t care about your analysis or your trading methods.
The market is totally impassive. It is always right. It rolls along and no-one can tell it what to do. If it doesn’t go where your analysis and your trading methods say it should, and you are losing money, it’s …
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Short Term Trading Calls:Jain Irrigation,Ranbaxy Labs and Bajaj Auto

Jain Irrigation

Forming Triple top @245 crossing over it with volumes can take the stock to new highs levels

Buy above 245 Tgt 248,255 and 266

Ranbaxy Labs

Ranbaxy Labs is unable to cross 50 SMA @583.Today also tried to cross it but selling pressure from higher levels made the stock to close below crucial 583 Levels.

Buy above 583 Tgt 588.7,595 and 601 Sl 575

Short below 583 Tgt 575,570 and 563 Sl 588

Bajaj Auto 

Bajaj Auto takes support at 100 DMA at every corrective dip as shown in chart.Once correction gets over stock rallies …
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Nifty Weekly Forming Three Black Crows Candelstick pattern

Three Black Crows

As the name suggests, the three black crows candlestick formation consists of three large, consecutive, declining candles. The formation precludes lower prices, especially after a strong advance higher. The three candles should all close near the lows of the bar and ideally each bar should open within the prior sessions real body. If the first candle in a three black crows formation is a gap, then this rule is not necessary. The three black crows pattern requires the …
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