Notes

Trading strategies 3-13-39 days EMA

Hi I am a nifty trader and I am using 3,13,34 min EMA Nifty Charts for my day trading purpose in
combo with RSI and stochastic which yields me . And this EMA setup works well for me. And I am
able to trade confidently every day without and fear. And moreover I am able to guess the entry
and exit points in nifty. In my opinion nifty is a good instruments to play for intraday what do you
say???
Dear Friends,
Here i give simple how to apply day trading Three Moving Average System, for short
term daily,profitable,
EMA-3 DAYS,

EMA-13 DAYS

EMA-39DAYS

apply these all in your chart,

Trading Signals
1.Go
2.Go
3.Go
4.Go

long Entry EMA 13 crosses above 39 EMA,

long exit EMA 13 crosses above 3 EMA,
Short Entry EMA 39 crosses above EMA 13,
short exit EMA 3 crosses above EMA 13

How to Select Stock for Trading

There are two major Index, Nifty and BankNifty and 145 other stocks listed in NSE
FnO segment. We should always trade with only familar stocks because its easy to
technical and fundamental analysis with familar stocks. There is no rule by SEBI that we
should have trade in all in this stocks . So we can choose some good stocks and can
again and again trading in them full life. If we trade only with familar stocks then its very
easy to understand them and we can easily find there support level and resistent level.
1. First stock price range should be 100-2000 rupees. (Ashok Leyland , Dish Tv
also good for trading).
2. Stock should have good volume.
3. Always choose good fundamental stock. Its very important in positional trade
because we hold it 3-4 days, if we ll choose any stock just because of any news
and hold it, then we can trap with it. With news that stock can run 10-15% but
very next day it will fell down to previous price then it ll never come back our buy
price. So avoid like this stock ( ex: Unitech, GMR Infra etc. )

4. If we ll choose any strong fundamental stock, and if its fell down from our buy
price then it cant stay long time at lower price and a hudge buying ll genrate
there because all want to buy fundamental strong stock in there portfolio so we
can easily earn profit.
5. Sector performance is very important in positional trading. Choose Stock from
good sectors like Auto , Banking and finacial , Pharma , IT, FMCG, Cement ( Now
Pharma sector is good )
6. First of all select some (10-15 stocks) good fundamentaly stocks from good
sectors and continous track them. After some time you ll familar with them and
can easily find there lower level for buying. We ll use technical analysis also for
find entery level. That one I ll describe in next topic. Dont run behind all stocks,
because its hard to track them and we can easily trap in it. (I am personaly
earning every month 40,000 - 70,000 rupees just by trade in 3 stocks - Axis bank,
ICICI and Ashok Leyland).

Process of stock selection

First of all, watch market direction.

After that watch sector performance, which sector is now days running.

Then pick some strong stock from our familar stocks for long. For entery Level ,
we ll use technical analysis.

Always keep in mind, Never short Future in positional trade, it can be suscide. If
there is any reason for short then can buy PUT .

Sell a scrip when MACD indicators indicate a downward move (either in terms of
the MACD line cutting the signal line from above) or when the MACD histogram
indicates a downturn and stochastic is in overbought territory
Buy a scrip when MACD indicators indicate a upward move (either in terms of the
MACD line cutting the signal line from below) or when the MACD histogram
indicates a upturn and stochastic is in oversold territory

Technical Analysis for Entry Levels

There are serveral indicator and methods, and we all are already know
about them. As a trader, you all know about them, know methods also. I ll also
tell same method that one you already know. Then what is differnece between
what I ll tell and you already known methods ? The answer is "PLAN, DISCIPINE
and PATIENCE". We all know this methods and indicators but never implement
practically. When at 9:15 am, opening bell of Stock Market ring, many butterflies

start to fly in our stocmach and in our mind only one thing, what to buy or what to
sell without any plan. All methods, plan, indicators and strategies, what we learnt
is no meaning and made position in any stock and now we are watching only
screen and start pray from god, please god make it in my direction... Some time ll
out from trade with profit and some time with loss. At the End of Month , all proit
and loss is equal. So without "PLAN, DISCIPINE and PATIENCE", its really hard
to earn profit with Positional Trade.
Intresting Fact : Some traders make position without think and plan in any
wrong trade and at the end of day when its in loss then they carry forward it for
next day, Next day also is loss because they entered in wrong trade then they
carry forward it again and again for next days and finally they have
complained that they did positional trade but then also booked loss. Its really
funny .
Some Indicators which one we ll use :
o
o

Simple Moving Average (20 days, 50 days , 200 days )

Support and Resistent trend line

Slow Stochastic

MACD

RSI

Candlestick Chart

Volume

Although, all of the trader know about this indicators, if some one dont know
about this one then they can search basic knowledge about this indicators at
internet. This is hard to explain about this indicators here. I am also trying to
learn from you guys :)
Be remember Magic
and PATIENCE".

is

not

in

Strategies,

its

in "PLAN,

DISCIPINE

Strategy for find Entry Level for Long or Short

Position
We ll use some indicators for find entery level for long or short position, if we ll keep discipline,
then sure it ll work fine.

Long :

Slow Stochastic at oversold position with buy mode

It should be confirm with either MACD or RSI too

It should be at rebounce from support level or break resistence.

A Bullish mode candelstick should be occur at daily candelstick

chart pattern.

Volume should be Increase.

Short :

Slow Stochastic at overbought position with sell mode

It should be confirm with either MACD or RSI too

It should be at reback from resistence level or break support level.

A Bearish mode candelstick should be occur at daily candelstick

chart pattern.

Volume should be Increase

Chart for testing the Strategy

Here is the COLPAL one year historical chart for testing the strategy,
you can find arrow on it for long or short according strategy, It ll help to
you for study. I have placed arrow manually, so arrow could be shift one
candel either left or right side, So please adjust and ignore such error as
I am also a human and I have also right to do like this error. all others
are fine. you can ask your doubt. :)

Strategy for find Exit Level for Long or Short Position

Exit from trade is more important than the enter in trade. There is no meaning of good entry in
trade, if we cant exit from it with good profit.

Long:

INITIAL STOP LOSS: It should be slightly lower the Support / Entry level.
We ll use trailing Stop Loss strategy.

When trade ll starts go in our direction, we start to trail Stop Loss.

We ll place Stop loss at slightly below the previous day close / low.

When SL ll trigger, we ll book our profit.

Short:

INITIAL STOP LOSS: It should be slightly above the Resistent / Entry level.
We ll use trailing Stop Loss strategy.

When trade ll starts go in our direction, we start to trail Stop Loss.

We ll place Stop loss at slightly above the previous day high.

When SL ll trigger, we ll book our profit.

Important:
Dont uses Initial Stop loss, instead of it use PUT / CALL option as a hedging. Some time, its hit
our SL and then again start go in our direction. So if we ll have a hedging with PUT / CALL, we
no need out from trade due to initial SL hit. When trade start in our direction, then sell this PUT /
CALL, which one use for hedging and start to trail Stop Loss Strategy.

Example with chart of trade with this strategy

In this section, I am just trying to expalin strategy with an
example of COLPAL, I already post 1 year historical chart
of COLPAL with entery level, I am just taking 2 months
chart from it, to explain long and short position trading
according to this strategy.
Example :

Lets we trade with just 2 Lots

Required Capital for 2 lots trade = Rs. 70,000

Quantity in 2 lots = 2 * 125 = 250

Time frame = 2 months ( July -August )
No. of Trades = 2
1st Trade (LONG) :
As show in chart, according to our entering strategy, this Long call genrated at
1565, its confirm by other indicators and bullish candelstick. then we ll follow
trailing stop loss method and at 1655 it ll booked. ( You can see detail on
chart).
Total Profit = 1655- 1565 = 90 Points
Total Profit with 2 Lots = 90 * 250 = 22,500 Rupees.
2nd Trade (SHORT) :
As show in chart, according to our entering strategy, this Short call genrated at
1655, its confirm by other indicators and bearish candelstick. then we ll follow
trailing stop loss method and at 1470 it ll booked. ( You can see detail on
chart).
Total Profit = 1655 - 1470 = 185 Points
Total Profit with 2 Lots = 185 * 250 = 46,250 Rupees.

So, Total Profit of two trades = 22,500 + 46,250 =

68,750 Rupees.
So, you can see that we can easily earn 68,750 rupees in
2 months (34,375 per month) with just Rs. 70,000 capital.
We made only 2 trades with 2 lots only. This is not any
dream, its real fact. We applied above discussed strategy
for enter and exit. You can self apply this one before belive
on it. But with discipline. you can ask your doubts :)
Important :
In this strategy, 1 time out of 5 trades , stop loss will hit. Some time you ll get
small profit, some time you ll get good profit and some time you ll get extra
ordinary profit. So over all you ll earn a handsome profit.

How to systematically create wealth in stock market ?

We all are in stock market for earn profit and create a

good wealth. But most of time, we cant find right way and
our capital not grow as like we want or some time its show
loss too. This happened because we convert our
investment into trading and trading into investment. I am
trying to present a realistic way. The way, I am using is the
Planned Trade and Systematically Investment.
Invest 95% money in good stock as long term investment
and keep 5 % money for trading. If we make any loss in
trading then can pay from it.
Do only trade with Capital and Risk management. Only
engage 50 % of your capital at once in trade. So you ll not
afraid, if its go against you also, its ll not affect you more.
What have you earned profit from trade, reinvestment it
with your old investment. Dont use this profit for trading.
In this way, your investment ll increase constantly.
We ll enjoy compounding on our investment, not on
trading.
We ll again planned trade with 50 % of our capital.
We ll constantly booked profit in our investment too. Like if
our invested share Increase 10-15 % within 3-4 days, then
we ll sell 20% quantity this level, If its further increase 5-10
%, the we ll sell 10% more at this level. If its go increase
more, then dont worry, we still have 70% stocks in our
portfolio. Its enough.
If any stock increase suddenly 15-20 % then its cant stay
long there, It ll fell down from that level. Its normal in
market. That time we ll buy again share, what we sold
before. Booking profit continually is good habit.

Lets take an example for understand it.

Assume that we have 1 lack rupees capital and we are
taking example of Axisbank trading at Rs.500.
I ll buy 95 thousand rupees axisbank stock in cash market
for investment. Bought 190 share at the price of 500and ll
keep 5 thousand rupees for trading, If any loss happen
then can pay from it.
Now at the first month, I ll trade with 1 lot according above
given strategy with engage of near most 50-60 thousand
rupees.
If the at the end of month total profit from trading after all
loss or profit add is 20,000 (Using figure for easy
calculation)
At this month Axis Bank is trading at 550, so I ll buy 37
shares from 20,000 profit.
Next month same, I ll trade with 1 lot according above
given strategy with engage of near most 50-60 thousand
rupees.
At the end of this month total stock is = 190+37 = 227
At the end of this month my total capital is = 227* 550 =
1,24,850 + 5000 = 1,29,850
If the at the end of month total profit from trading after all
loss or profit add is 20,000 (Using for easy calculation)
At this month Axis Bank is trading at 600 rupees so, I ll
buy 33 shares from 20,000 profit.
At the end of this month total stock is = 227 + 33 = 260

At the end of this month my total capital is = 260* 600 = 1,

56,000 + 5000 = 1, 61,000
We ll repeat same process every month, when our capital
become double we ll start trade in 2 stocks and then so
on.
The successful formula of smart trader is :

Planned Trade + Systematically

Investment = Create Wealth
Note: I am using profit or stock value as a example for easy calculation. Its not real prices. So please dont ask from
me that I provide any chart for it. Real profit can be different from this. All values used in it, just for understand easily.