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TradingAlgorithm

The document outlines a trading algorithm that involves assessing long and short term trends to identify buying or selling opportunities. Specific conditions for entering trades, including support and resistance levels, moving averages, stochastic indicators, and volume, are detailed for both long and short positions. It emphasizes the importance of multiple confluences and implementing stop-loss strategies to manage risk.

Uploaded by

Ravi Goda
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© © All Rights Reserved
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Download as PDF, TXT or read online on Scribd
11 views

TradingAlgorithm

The document outlines a trading algorithm that involves assessing long and short term trends to identify buying or selling opportunities. Specific conditions for entering trades, including support and resistance levels, moving averages, stochastic indicators, and volume, are detailed for both long and short positions. It emphasizes the importance of multiple confluences and implementing stop-loss strategies to manage risk.

Uploaded by

Ravi Goda
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Algorithm for trading:

1. Check the long term trend.

2. Check the short term trend.

3. If the long term trend is up and short term trend is down,

look for buying (long) opportunities.

4. If the long term trend is down and short term trend is up,

look for selling (short) opportunities.

5. For buying (long) check for below conditions:


a) look for underlying stock at the support or
bouncing back from support.
b) Check lower avg is above the higher avg.
c) Check underlying stock is above it's 50 day avg.
d) Stochastic should be below 20.
e) Volume should be more than avg volume.
f) if trade turns against us, try to stop loss
between 15% to 25%.
(also check if it's breaking the previous low),
you can wait if it get's the support at
previous low.

6. For selling (short) check for below conditions:


a) look for underlying stock at the resistance or
coming down from resistance.
b) Check lower avg is below the higher avg.
c) Check underlying stock is below it's 50 day avg.
d) Stochastic should be above 80.
e) Volume should be more than avg volume.
f) if trade turns against us, try to stop loss
between 15% to 25%.
(also check if it's breaking above previous high),
you can wait if it doesn't get the support at
previous high.

7. Always look for multiple confluences (minimum 3)


before placing a trade.

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