Last week, I was not in town and few of my friends phoned me to know what should they do while they were either stuck in their positions Or they were not able to take the new positions as per market movement.
Their answers to my few questions, gave answers to their questions. Confused…
They got their queries solved by answering few questions.
What are those Questions ?
How did they made profit of Rs. 35,000/- in just one day ?
Yes My friends, The Case Study this week is Jubilant Food Which Gave Rs. 35,000 Profit in just ONE day.
This time I am not talking about technical indicator or Momentum Indicator but the real momentum in stock reflecting in its price movement.
In general the market is either swinging up or down or it is stuck in a range. when a stock or a market as a whole gets stuck in a narrow range which does not seems to be Real. In this period the traders who likes to be make or lose money every now or then face obstacles. Because in narrow market range they keep on changing positions from long to short and vice versa.
Simple Questions asked and they got it right.
Q1. What is that you are not making money / losing money ?
Answer : The market is not moving.
Q2. Can you wait unless it doesn’t move in a particular direction in convinced manner ?
Answer : Yes, off course.
I get lot of queries from traders where they lack homework or lack the eye to grab what is actually happening in market. Mostly Traders do the opposite of the trend or miss the trend because of lost anxiety during the waiting period & fear.
In Trading, in most of the cases, Before a bigger momentum starts there is a time, few minutes, hour or sometimes days where the stock loses its momentum. One needs to identify such periods and then once a breakout either upward or downward happens then you need to take positions which you can afford to your pockets.
If Merged with supports & resistances, you will find perfect levels to play Momentum trades with unbeatable accuracy.
Case Study : JublFoods Recommendation : Sell Rate : 2045-2060 Target : 1925 This Stock helped traders to make a whooping profit of Rs. 35,000/- in just ONE DAY
1. On 12th & 14th Feb stock was trading in a narrow range of Rs. 22 i.e. (2050 line A) to 2028 (line B)
2. The Stock shot up above 2050 & went up to 2116 on 15th Feb but was unable to hold the up move & fallen back below the line B.
3. As soon as it fallen below 2025 it triggered a Bull Trap Case in circle. Because if the prices couldn’t sustain upward levels which were hit in euphoria & fall below the support level means the upward movement was a false breakout. If the market goes up sharply and the trend is reversed it should not fall below the lower price band, at least immediately.
4. The stock has also broken the trend line after falling below line B.
The call was initiated to sell between 2045-2060 to lower the risk. But you know anxious traders like Mr. Vinod hit the sell button @ 2020 & booked profit @ 1950 before target price of Rs 1925 could get achieved.
Let’s hear what he has to say about his this trade: Vinod’s Testimonial “I have been trading in shares since so long, but i have not been making money since I was not trading on a particular plan, strategy. After I met Chandrakant I got a direction of trading and he told me what suits me. Eventually my number of losing trades gone down and number of profitable trades gone up, I am happy to raise query with Chandrakant to get a proper guidance.”
What do you need to do is ask 3 Questions to yourself
- What do I do when my position or stock is trading in narrow range ?
- Do I have a knowledge of my pain level before entering a position ?
- How do i find consolidation phases and take trades accordingly ?
“Its critical for a crocodile to understand its prey and to know where to look for it and remain calm & patient until it arrives, As Traders, we have to know what our trading edge looks like and where to look for it and then control ourselves enough to not to over trade”
Stay tuned for more strategies & Case studies.
1. If you like these posts don’t forget to share it with your friends.
2. If you also feel anxious like Mr Vinod, leave your query in the contact section. We will comeback to you.
PS : Successful traders understand every market is different and that’s why they keep themselves away from market when they struggle to chart out their trading plan.