Ref Image 1

Ref Image 1 Notes

1. However, in this specific stock's case, there is a hidden bullish divergence with RSI, Stoch
and MACD. The reason I've used MACD here is that between both the points, price was
trending all the time, first uptrend and then downtrend. MACD is a wonderful tool for trending
environments while RSI/Stoch is better is non-trendling environments. Moreover, as I said a
divergence with MACD or RSI or Stoch, all mean different things. But as a thumb rule, MACD
works in trends while RSI/Stoch work in non-trending scenario.
2. MACD for trends an RSI/Stoch for ranges
3. Hidden Bullish Divergence With RSI on Daily Chart

1. RSI makes LOWER LOW

2. Price makes HIGHER LOW

RSI makes LOWER LOW

Three scenarios here:

a. Both RSI divergence points are above 50

b. Both RSI divergence points are below 50

c. One point is above 50 and other is below 50

Let's take them one by one

a. Both RSI divergence points are above 50

Let's take an example. Two points in time A and B.

At A, price is 50
At B, price is 70
At A, RSI is 65
At B, RSI is 55
This is a clear hidden bullish divergence.

Let's understand the RSI here.

At A, RSI was 65

Means, 100-[100/(1+RS)] = 65
which means that RS = 1.85 (Do the maths yourself)

Which means that at A, the average gains of past 14 days were 1.85 times more than average losses.

At B, RSI was 55

Means, 100-[100/(1+RS)] = 55
which means that RS = 1.2 (Do the maths yourself)

Which means that at B, the average gains of past 14 days were 1.2 times more than average losses.

But price was greater at B despite the fact that average gains over losses figure dropped at B as
compared to A.

b. Both RSI divergence points are below 50

Let's take an example. Two points in time A and B.

At A, price is 50
At B, price is 70
At A, RSI is 40
At B, RSI is 30

This is a clear hidden bullish divergence.

Let's understand the RSI here.

At A, RSI was 40

Means, 100-[100/(1+RS)] = 40
which means that RS = 0.67 (Do the maths yourself)

Which means that at A, the average gains of past 14 days were 0.67 times more than average losses. In
another way of saying, average losses were 1.5 times more than average gains.

At B, RSI was 30

Means, 100-[100/(1+RS)] = 30
which means that RS = 0.43 (Do the maths yourself)

Which means that at B, the average gains of past 14 days were 0.43 times more than average losses. In
another way of saying, average losses were 2.3 times more than average gains.

But price was greater at B despite the fact that average losses over gains figure increased at B as
compared to A.

b. One point of RSI is above 50 and one point is below 50

Let's take an example. Two points in time A and B.

At A, price is 50
At B, price is 70
At A, RSI is 65
At B, RSI is 40

This is a clear hidden bullish divergence.

Let's understand the RSI here.

At A, RSI was 65

Means, 100-[100/(1+RS)] = 65
which means that RS = 0.67 (Do the maths yourself)

Which means that at A, the average gains of past 14 days were 2.85 times more than average losses.

At B, RSI was 40

Means, 100-[100/(1+RS)] = 40
which means that RS = 0.43 (Do the maths yourself)

Which means that at B, the average gains of past 14 days were 0.67 times more than average losses. In
another way of saying, average losses were 1.5 times more than average gains.

But price was greater at B despite the fact that at A average gains of past 14 days were more than
average losses and at B, average losses of past 14 days were more than average gains.

Now let's get the CRUX.

The crux is that Price rose despite the fact the average gains decreased or average losses increased,
whatever way you want to put it.

It means that, DESPITE A FALL IN POSITIVE MOMENTUM, PRICE MANAGED TO STAND ITS
COURSE HENCE BULLISH. WHAT IS MOMENTUM SHOWN BY RSI? IT IS THAT OVER
LAST 14 DAYS, THE PRICE, ON AN AVERAGE, IS SHOWING MORE BEARISH BIAS THAN
BULLISH. THIS KIND OF CALCULATION DOES NOT REQUIRE A TREND. IT JUST
REQUIRES MOVEMENT IN PRICE. SO EVEN IF THERE IS LITTLE RISE IN PRICE BETWEEN
A AND B, STILL RSI CAN HAVE A HIDDEN BULLISH DIVERGENCE. ALSO, SCENARIO C.
IS MOST STRONG BECAUSE MOMENTUM IS TURNING FROM POSITIVE TO NEGATIVE
AND STILL PRICE IS ABOVE THE PREVIOUS POINT.

Hidden Bullish Divergence With MACD on Daily Chart

1. MACD makes LOWER LOW

2. Price makes HIGHER LOW

MACD makes LOWER LOW

3 Possibilities here

a. Both A and B are above center line

b. Both A and B are below center line
c. A is above center line while B is below center line
Let's take them one by one.

a. Both A and B are above center line

It means that 12 DEMA is above 26 DEMA at both A and B.

But since B is lower than A, it means that the distance between 12 DEMA and 26 DEMA is lesser at B
than A but 12 DEMA is above 26 DEMA at both A and B.

Which means that At A, price moved sharply higher over last 12 days than last 26 days. But at B, price
moved less sharply higher over last 12 days than last 26 days.

b. Both A and B are below center line

It means that 12 DEMA is below 26 DEMA at both A and B.

But since B is lower than A, it means that the distance between 12 DEMA and 26 DEMA is more at B
than A but 12 DEMA is below 26 DEMA at both A and B.

Which means that At A, price moved lower less sharply over last 12 days than last 26 days. But at B,
price moved more sharply lower over last 12 days than last 26 days.

c. A is above center line while B is below center line

It means that at A 12 DEMA is above 26 DEMA

And At B, 12 DEMA is below 26 DEMA

The CRUX is that despite a fall in VELOCITY OF PRICE, price is still above its previous point, which
shows bullishness. IT SHOWS THAT PRICE OVER 12 DAYS ARE MOVING MORE OR LESS
SHARPLY THAN PRICE OVER 26 DAYS. THUS THIS CAN BE CAPTURED VERY WELL IN
TRENDS. THE BEHAVIOR OF MACD WILL ACCENTUATE DURING TRENDS. THUS, TO
FORM A HIDDEN BULLISH DIVERGENCE IN MACD, PRICE HAS TO MAKE SHARP
MOVEMENTS. ALSO, POINT C. IS MOST STRONG BECAUSE VELOCITY OF PRICE MOVE
HAS GONE FROM FLAT TO NEGATIVE AND YET PRICE IS HIGHER
Ref Image 2

Ref Image 2 Notes

1. Too many candles at same level. Acts as support/resistance in the context of price.
2. Exhaustion gap occurs when the trend is ending. If it is uptrend, then its a gap when all the
bulls put all their efforts and exhaust. Trend reversal follows soon.

Ref Image 3
Ref Image 3 Notes

1. A zone is a collection of well spaced out touch points.

Ref Image 4

Ref Image 4 Notes

1. The circled candle is the pivot which has two candles to its left and two to its right. The
left one is a high pivot with two candles on the left and right each making lower highs.
The right one is a low pivot with two candles on the left and right each making higher
lows
2.

3.
Ref Image 5

Ref Image 5 Notes

1. See MothersonSumi, the angle of the slope of tops was continuously falling even though
price was rising. This gave way to the big picture view. Then of course we can get into
price patterns and specific candles.

Ref Image 6
Ref Image 6 Notes

1. Use stochastics in ranges. Secondly, the oscillations in stoch must be close and several. So lets say
price is in a range and stock is rising. But it will only pass SBTS test if the rising stoch is full of close
oscillations. Also, the use of MACD is completely wrong. You can't just draw an ascending line just
because MACD is rising. In fact, MACD was rising below and such situations are perfect for shorting
because majority of times, MACD turns back from 0 line presenting a wonderful short opportunity. In
fact, if you'd check your chart, you find the same thing. MACD never crossed above 0 in 3 minute
frame since your screenshot time.

Ref Image 7

Ref Image 7 Notes

1. Q. F had also broken the resistance @B.., hadn't it ?
A. The next day was a dark cloud cover so it couldn't even sustain for one day. That's not
called broken. Just like today, today's candle broken back in the resistance
Ref Image 8

Ref Image 9

Ref Image 9 Notes

Ref Image 10

Ref Image 10 Notes

Miscellaneous Notes
1. Someone asked me my favorite set-up for a trade. Here's the answer.
I do not look forward to make a killing. My biggest priority is not to lose much if the trade
thesis goes wrong. The reason for this mindset is that I look at trading as a business and
not as a jackpot seeking activity. I've experienced over a long time that if one manages to
survive and preserve the capital long enough, jackpots are bound to happen but if one
actively looks for them, he is setting up the stage for suicide. Now, having said that, risk
comes first to me and potential rewards come second, my trade-set up is also a reflection of that.
My perfect trade set-ups are where the nearest technical stop-loss is coming at a risk of less than
2% risk on my capital. A technical stop-loss is a point where the trade thesis will stop being right.
It can be a support/resistance, or a pivot point, or a Fibonacci retracement level or a candle pattern
and so on. So, I look at 100s of charts on daily basis and my eyes are always in search of a set-up
where a technical stop-loss is very near to the current price. This is the first and foremost priority.
Only when this is visible, I look towards things like potential rewards. Rest everything else is
secondary. Once this is assured that in case the trade thesis goes wrong (of course it may as
trading is a probability), I'd not lose more than 2% of my capital, then it is all about managing the
trade by scaling in and scaling out. THIS IS MY FAVORITE SET-UP, be it a day trade or a swing
trade or a positional trade. I just look for trades where I'm not gonna lose much. I do not spend my
time in finding trades where I can not go wrong because there are no such trades where you can
not go wrong. Accept that as soon as possible if you are really serious about the profession of
trading. You will go wrong more than you will go right. The key is to make more when you are
right and lose less when you are wrong. The key is to achieve a positive expectancy. You see,
rewards are not in your hands. Risk is always in your control. So, stop focusing on something
which is not in your hands and start focusing on things which are completely in your control.
2. Use higher frame for direction and lower for execution and best executed trades are taken in
contra lower frame moves
3. “People think focus means saying yes to the thing you’ve got to focus on. But that’s not
what it means at all. It means saying no to the hundred other good ideas that there are.
You have to pick carefully.”
~Steve Jobs
4. When batting side is making runs, don't just get bullish on it. Observe closely to figure out
whether runs are being made due to good batting or due to bad bowling & fielding. So, if
prices are rising, try to know whether it's due to active buyers or just due to passive
sellers
5. PSYCHOLOGY OF A FLAG
I've said it so many times and I'll say it again, "PATTERNS MEAN NOTHING,
SENTIMENTS DO." The problem with most people is that they ignore sentiments and try
to FIND SHAPES. Market is not a Geometry class, MARKET IS PEOPLE.
As we all know that a flag formation is a continuation pattern. It consists of a POLE on
high volume, a COUNTER MOVE FLAG on low volume and a BREAKOUT in the
direction of the pole on high volume. So, in case of a bullish flag, we have a pole on high
volume in upward direction, a flag which forms in downward direction on low volume and then a
breakout in upward direction on high volume resuming the direction of the pole. And in case of a
bearish flag, we have a pole on high volume in downward direction, a flag which forms in the
upward direction on low volume and a breakout in downward direction on high volume resuming
the direction of the pole. Also, an ideal flag must not stretch more than a month.
6. If the flag correction happens on very high volume, it won't represent profit booking but a
potential shift in psychology of buyers and sellers and a potential reversal or a sideways
action. A correction on low volume represents that only few people are getting out and
their selling is being completely absorbed by buyers without price falling too much. Also,
see the importance of time. If flag correction takes a long time, it means that there is
something wrong brewing inside. Profit booking is a fast phenomena and those want to
get out, get out fast. So, if a flag formation stretches too much in time, that also negates
 its possibility of being a flag and indicates towards beginning of sideways movement or
even a reversal. That is the sentiment of a bullish flag
7. I always say that do not run after patterns. Understand the psychology of buyers and
sellers creating the patterns.
Let's say, price made a swing high of 100. Sellers (profit booking participants) get
enthusiastic and place their offers at the bids, creating a correction as buyers bid lower
and lower and sellers meet their demands. Let's say price stabled at 85 and buyers got
enthusiastic as they think that it's a great value at 85. And due to their enthusiasm, they
started bidding at the offers thus creating a price bounce. Sellers offered to sell higher than
market price and buyers, in their enthusiasm, met their demands and price rose. Price rose till 100
and sellers got active again. These set of sellers might include fresh sellers who think of it as a
supply zone, plus those who bought at 100 initially and price corrected to 85 after their buying, so
they want to get out at break-even. Now, due to selling pressure, price corrects again from 100 and
starts falling. Now, let's say it falls to 90 and buyers kick in and make it rise to 100 again where
sellers are ready again. The subsequent correction found buyers at 95 who pushed the price to 100
from where it corrected again. Now, what's happening is that though sellers are persistent at 100
levels, the buyers have turned more enthusiastic and on every correction, they get ready to buy
even at a higher price than previous correction low. So, the keen eye of a trader realizes that the
balance is being shifted in the favor of buyers silently and the eventual breakout of the price from
100 levels is more probable. This is the whole psychology of what you call an ASCENDING
TRIANGLE.

8. When something is falling relentlessly, do not search for supports rather search for
resistances on the bounce. Similarly when something is rising relentlessly, do not search
for resistances but search for supports on the pullbacks.
9. A Very Important Tip
Horizontal lines are far more effective than sloping lines when it comes to defining
supports & resistances. Even if you have a sloping trend-line in place, always consider
tentative horizontal lines from swing highs and swing lows as points of reference.
10. WHAT TO SEE IN THE CHART
a) Overall Price structure
b) Price patterns
c) Candle Patterns
d) Indicators & Oscillators, if needed, to confirm the above thesis.
This should be the order. This is applicable across time-frames. However, beginners start with 4th
& never reach 1st
11. PRICE PATTERNS comprise of shapes which are documented in technical analysis
textbooks, be it continuation patterns like symmetrical triangles, flags, pennants or
reversal patterns like Head & Shoulders, Double tops/bottoms and so on. Of course,
every pattern has a psychological basis, but they are set patterns anyway.
12. PRICE STRUCTURE is the art side of chart viewing.
So, when I say PRICE STRUCTURE, I literally mean CHARACTER of the price. Every
stock's chart has a specific intrinsic character. For example, you see a chart and you
realize that every time this stock rises, it rises on small candles and falls on small candles
as well. With some other stock you may find that it tends to form a lot of V and inverted V
shapes which means quite fierce and abrupt action by bulls and bears. In some stock,
the case might be that it tends to create long shadows. You see, just looking at the
chart's history and habits, you can learn a lot about the type of parties involved in that
stock. And mostly a stock character doesn't change for a long long time because major
controlling parties don't change easily. So, by character, I mean, looking at the nature of
rises, nature of falls, size of candles, steepness of rise and falls, count of candles in rise
vs count of candles in falls, frequency of consolidation and trends, whether the stocks
 tends to make V bottoms or U bottoms and so on. I mean it is so artistic that you can
unveil a lot of secrets
13. Price patterns give you a directional bias, individual candles give you the execution trigger
14. If it ain't simple, it ain't worth a look.
15. It is most healthy when the size of the candles are smaller. Every time it trends on
smaller candles it goes a long way
16. The moment average size of the candle increases it becomes erratic
17. OI Spurt + Good Chart Setup + Price in trading zone offering good risk reward
18. No but generally most corrections stop at 38.2%, 50% or 61.8%. If they don't, then it's not correction
but a reversal. 50% is a safe zone to enter.
19. The size of candles was getting uncomfortable bhai. I like to get in small candles and get out
in big ones.
20. Use stochastics in ranges. Secondly, the oscillations in stoch must be close and several. So lets say
price is in a range and stock is rising. But it will only pass SBTS test if the rising stoch is full of close
oscillations. Also, the use of MACD is completely wrong. You can't just draw an ascending line just
because MACD is rising. In fact, MACD was rising below and such situations are perfect for shorting
because majority of times, MACD turns back from 0 line presenting a wonderful short opportunity. In
fact, if you'd check your chart, you find the same thing. MACD never crossed above 0 in 3 minute
frame since your screenshot time.
21. Rather extraordinary volumes on a bearish candle in mid of a downfall would be bullish due to
exhaustion phenomena.
22. .A breakout candle distorts the risk reward scenario. My personal view on trading breakout candle is
this. In case of a breakout, I go long in two scenarios only. One, when the next candle breaches high of
the breakout candle, i.e., continued momentum. In this case, I get an anchor to put my stop at, breakout
candle's high/close (whatever I deem fit). The second scenario is that post the breakout candle, price
pulls back and confirms the previous resistance as support. In that case too, I get a good anchor to put a
stop, i.e., below the support. But in this specific case, what happened was that the next candle to the
breakout candle went higher than the breakout candle, getting me in the trade but then soon it fell
below breakout candle's close, hitting my stop. Once that happened, I got ready to buy if the pullback
takes support at the previous resistance which it didn't, and fell below the breakout resistance. Hence,
no positions (BREAKOUT VIEW)
23. Price tells you the level at which people want to buy/sell. Volume tells you the urgency
with which they want to buy/sell.
24. So, if price is rising on high volume with a rising OI, it means LONG PLAYERS are
dominating.
If price is rising on a high volume with a falling OI, it means SHORT COVERING
PLAYERS are dominating.
If price is falling on high volume with a rising OI, it means SHORT PLAYERS are
dominating.
If price is falling on high volume with a falling OI, it means LONG UNWINDING
PLAYERS are dominating
25. the overall context matters a lot in identifying the difference between consolidation and
distribution. However the signature style of a consolidation is smaller movements within
the range (low volatility) combined with low volume. While the distribution's signature
style is bigger movements in the range (high volatility) combined with high volume
26. Horizontal lines are far more effective than sloping lines when it comes to defining
supports & resistances
27. Daily open/close, weekly open close and monthly open/close matter because between any
two candles, market is CLOSED. But intraday open/close do not matter as market is already
OPEN and it is YOU who is trying to divide an already OPEN market into OPENS and
CLOSES and market doesn't know YOU
28. Scenario-1:

Price OPENED at 100 then made a low of 88 and then zoomed to 118 and closed at 110.

Scenario-2:

Price OPENED at 100 then made a high of 118, fell to make a low of 88 and then closed at
110.

Will the interpretations of both the scenarios be same?

No, in the first case price opened and then made a quick low showing the reaction of
amateurs but then professionals took over and brought it higher to 118 but then due to profit
booking price fell and closed at 110. This price action is BULLISH. Here price made a high
and due to profit booking it closed a little lower.

In the second case, price opened and then the euphoria of amateurs took it to 118 but it could
not sustain at the high and then it started falling and touched a low of 88. Then somehow it
recovered near the end of the day and closed at 110. It is NOT THAT BULLISH RATHER
DOUBTFUL. Here price made a low and recovered to close higher.
29. The only reason a beginner holds losing trades and cuts winning trades too soon is that
he treats every single trade as a matter of life and death and attaches too much
importance to any single trade. The moment he accepts that this is a futile activity and
trading is not about winning every trade but about being net positive over a number of
trades, emotions stop hampering and trading becomes rational.
30. R:R ratio & Position sizing & STOPS:
Risk-reward is not a static thing. It is a dynamic thing. It changes while we are in a trade.
My focus is on controlling my risk, which effectively means a good entry. Now, even if
risk-reward is 1:1, I can tilt it in my favor by position sizing while in the trade. There are so
many trades where I entered on 1:1 or 1:1.5 kind of risk reward and by the time I exited,
the risk reward was 1:10 as per my original risk. I am a very short term trader and if I'd
keep 1:8 or 1:10 kind of parameter along with the fact that technical stop should be no
more than 2% of my capital, trust me, I won't have anything to trade. So, my mantra is
that I control my risk by refining my entry and then tilt the things by adding and reducing
positions.
1:1 R:R will always lose over the long term. At least 1:3 to be a long term winner. It actually
depends on the setup sometimes you can catch 1:10 or even more. But minimum should be
definitely more than 1:2 . That's my opinion and the way I prefer. RRR is always dynamic.
There is no harm entering a 1:1 because it may become 1:5 while in the trade. By contrast
even a 1:5 can turn into a 2:1 after entering.
The primary thing is Stop, then comes entry and then comes position sizing.
EXAMPLE:
Your capital is 10 Lac.
You buy 5000 shares at 100 of ABC because a technical stop is established at 98 that is
less than 2% of your capital. So, you effectively risk 10000 which is 1% of your capital.
Now, stock moves to 110, your MTM is 50000 and you trail your stop to 105 (based on
technical picture).
Your net risk has become negative as you have taken up a risk of 5 bucks or 25000 and
your MTM is 10 bucks or 50000.
You put up another lot of 5000 shares at 110.
Now your quantity is 10000 shares. Your MTM is 50000 and your risk is 50000 thus you
are risking 0% of your capital even by adding 5000 more shares.
Now, you have assumed power of leverage with 0 risk effectively.
Now price goes to 115 let's say and you cash out. You made a total of 20 points at an
initial risk of 5 points.
20 points because you made 10 points on 1 lot from 100 to 110 and 5 points on 2 lots
 from 110 to 115.
This is using the price movie to your advantage by adding quantity at no risk.
Let'say price wold have moved to 113, your MTM would have been 80000, you would be
able to add one more lot if you are getting a good stop even at 107. I hope you're getting
my point.
See once you have moved in the positive territory, your capital risk becomes negative if
you trail the stop to technical points. And the only way to utilize negative risk is to scale
in.
Now, even if price had moved from 110 to 105, you could have scaled out 1 lot and still
keep 5000 shares and you would still have a window based on 2% of capital.
So, it all depends upon lot size and position sizing. That is the gist of trading
31.

32. A gap where almost OPEN=LOW and keeps

on rising shows the strength of the gap and
strength of forces pushing it. It was not just
a stupid mania filled OPENING GAP but a
serious BREAKAWAY GAP.
33. Bullish Zone 80-40
34. Bearish Zone 20-60
35. Sideways zone 40-55
36. Shorting with RSI above 60 is a bad idea. Hard to differentiate between selling pressure or
LACK OF BUYING pressure

37. Never ever trade with DEMAND & SUPPLY

IN EQUILIBRIUM. Always SEEK AN
IMBALANCE OF DEMAND & SUPPLY.
38. The green spikes/shoots in volume during the consolidation, which I have circled. That shows
that this range bound action is being used to accumulate a lot of stocks. Generally, big hands
accumulate the stock when it's still. But they leave their trail in volume
39. There are two things, Price Action (PA) and Market Structure (MS). PA makes MS and not the
other way round. MS is static, PA is dynamic. Now, think of it like this. PA on one time-frame
makes MS on a lower time-frame. It might take a little time to get absorbed but think hard
about it. Even a random PA on hourly may make some great looking pattern (MS) on 5
minute frame. Similarly a MS on daily is result of PA on weekly and any frame higher than
daily. This gets diluted to the fact that everything we are seeing on any frame, any pattern,
any shape is still an uncompleted movement on higher frame. So, who will you give more
importance, the controller or the controlled? That is the reason higher frame commands more
reliability and stability. A wonderful Head & Shoulder on 3 minute might be a random
sideways action on daily chart. I am not saying that lower frames do not matter but lower
frames are being made by PA of higher frames hence they become more significant. Having
said that, every frame will have its own set of support, resistances, patterns, risk-rewards and
so on. But the structure of a higher frame will always command. Think of it like this, a bullish
structure on 1 minute frame can be part of an ultimate bearish structure on hourly. That is why
we take direction from the higher frame and execute the direction on lower frame. But how do
we do this? We use contra moves of lower frames to enter in the direction of higher frames.
that is where the wonderful risk-reward lies, given the structure of higher frame is intact. So,
let's say I have price at a support on daily chart and price bounces a little, now lets say on 5
minute frame we have a correction, but the support on daily frame is intact, isn't that an
opportunity? I mean you are getting wonderful risk reward. So, that's the thing, use higher
frame for direction and lower for execution and best executed trades are taken in contra lower
frame moves. Higher and lower are subjective according to trade duration. 15 minute can be
lower for you but higher for me and so on. I hope you got the point
40. 10 HOLY GRAIL POINTS TO BECOME A SUCCESSFUL TRADER
1. Choose a trade duration.
2. Open the chart and choose a primary time-frame depending upon your duration.
3. See the primary direction in the primary time-frame. This will tell you whether to get long or
short.
4. Open a lower time-frame. Enter when price makes a reversal candle after an opposite
move to the primary direction on low volume. (I have asked to buy a counter move on a lower
frame which means that if hourly is up, I am asking to buy when there is a fall on 10 minutes and
a reversal happens. Now, that fall has to be on low volume, isn't it? If the basic structure is up,
falls should happen on low volume. If the basic structure is down, bounces should happen on low
volume. If they don't, the basic structure in itself would be in danger)
5. Place a stop loss beyond the correction swing.
6. Trail the stop as you get in green.
7. When you're right, you make good money.
8. When you're wrong, you lose a little.
9. Keep doing it for years.
10. Congratulations! You're a successful trader
41. When trading, never ever look the the cause. The reason is that it may
affect and rather distort the decision making. News may make us panic
or hopeful and all at the wrong times
42. We all hear that 95% people fail in trading. But if you see closely, it's
very obvious. Just look at how a lay trader talks. He always asks
questions like, "What's the target" or "How much time will it take to
achieve the target". But he never asks, "Where's the stop-loss?
43. There is no hard and fast rule but telling you from experience that never enter on the breakout candle
on whatever time frame. Wait for the breakout high to be broken. That is one. Another way can be to
gauge volatility and momentum expansion. They must expand in the direction of the breakout. Most of
the break-outs which turn to be fake-outs do not have volatility and momentum expansion. Another
way that you get gauge a breakout's strength is that while in the range, see the range of candles, if there
is an expansion in the range. Also notice the change in open interest. If open interest has risen
extremely well then whichever side the breakout happens, it tends to sustain itself. (Breakout View)

44. Bollinger Tip In W bottoms, if 1st low is

below lower band & 2nd low is within lower
band, it's bullish, even if 2nd low is lower
than 1st low. In M tops, if 1st high is above
upper band & 2nd high is within upper
band, it's bearish, even if 2nd high is higher
than 1st high.
45. Volatility is more cyclic than price. Low

prices don't necessarily beget high prices.

High prices don't necessarily beget low
prices. High & low is subjective in price. But
low volatility always leads to high volatility &
vice versa. Volatility is more forecastable&
cyclic.
46.

47.

C = Current quarterly earnings >25%

A = Annual earnings growth >25%. At least 17% ROE
N = NEW products, management or services
S = Supply and demand
L = Leader or laggard? Of course the leader!
I = Institutional sponsorship
M = Market direction