Trading Phases

9:15 am to 11:00 am Morning (Recommended for intraday trading)

11:00 am to 2:00 pm Noon ( Mostly for option trading)
2:00 pm to 3:30 pm Evening ( BTST/ STBT)

Intraday trading = 4 candle trade

If looking at a 15 min chart, trade should be completed in 1 hour ( 15 min x 4 candles)
If looking at 5 min chart, trade should be completed in 20 mins ( 5 min x 4 candles)
Correct time for BTST is 3:15pm or before

Trade Setup for BTST

Time - 2:30 pm
1) Bollinger band should squeeze at 2:30pm. Thus, trade should be rangebound
2) Candle should breakout at squeeze (green candle formation should break the upper bollinger band)
3) Breakout candle should be large and with big volume
4) Preferably RSI should be above 60 when the cande breaks out the upper bollinger band
5) Your buy price should be your stop loss
 Fibonacci Retracement

Fibonacci Retracement helps to identify point of buying.

How to enter trade?

1) Find trend ( Refer Heiken Ashi candles or weekly charts for long term traders)
2) Uptrend ( Buy at Pullback)
Downtrend( Sell at rally)

When will pullback come?

Popular levels :
38.20%
50%
61.8%
100%
 VIX

Volatility Index shows the value of change in price with respect to the average price expressed in terms of percentage (for in
Higher the volatility, higher the premium charged of option ( greater chance of earning more money)

Historical Volatility:
HV shows the volatility of stocks based on past perfotmance, but with past, we predict the future (for stocks)

Implied Volatility:
Implied means inherant volatility and is already included in premium.With high premium, you can guage High Volatility ( for

VIX Volatility Nifty

Down Down Up
Up Up Down

- Check Historical Volatility of a stock from NSE website

- Stocks with Volatility 100+ should be used only for intraday or swing trading and must be avoided for Long term trading
sed in terms of percentage (for index)

future (for stocks)

you can guage High Volatility ( for options)

voided for Long term trading

Bollinger Bands + MACD + RSI

If Bollinger bands narrow down and the candles start hugging the bollimger band, it is a bullish signal.
To confirm, check if RSI is trending up and MACD 12 day has crossed the 26 day line.

Pro tip 1: If the price touches MACD line from above and bounces back, it is a buy signal.
Pro tip 2: If RSI shows double top, it is a bearish signal and if RSI shows double bottom, it is a comfimed bullish trend.
a comfimed bullish trend.
Support and resistance

Check support and resistance with:(MACD,MFI,RSI)

RSI:
If share is in resitance zone and RSI is in overbought zone, you should sell the share.
If share is in support zone and RSI is in overbought zone, you should buy the share.

Try to join maximum candles without cutting bodies for support and resistance

Trend reversal :
When at support, if a large green candle is formed, it is a bullish trend reversal.
When at resistance, if a large red candle is formed, it is a bearish trend reversal.
How to buy stocks at bottom

Trend lines:
While drawing a trendline( bullish or bearish), make sure that at least 3 points are touched by the line.

Moving averages:
MA are dynamic support and resistence
Always use EMA
When a stock is very bullish it always takes pattern and support of 20 day DMA
When a stock is in uptrend, stock always trends above 200 DMA and below 200 DMA when in downtrend

How to confirm a trend?

A trend wont change unless there is some news related to the stock or its quarterly results are not as expected.

RSI is the best momentum indicator

When the stock is in uptrend, buy the stock when RSI < 40 ( stocks above 200 DMA)
When the stock is in downtrend, sell the stock when RSI > 60 ( stocks below 200 DMA)

Trend lines + above 200 DMA and taking support of 20 DMA + RSI moving up = CONFIRMED BUY
Trend lines + below 200 DMA + RSI moving down = CONFIRMED SELL
n downtrend

re not as expected.
How to select stock for a long term using Fundamental Analysis *

Select only from top 50-100 companies (NIFTY 50)

Select a pool of top 10 companies
Select the sector leaders from NIFTY 50 (good market cap, not sufferingintense competition)
Select a company whose products are used by majority of people
Check YoY return for one year and three years
Check QoQ results( Do not buy if only one quarter results are good. Check last three quarter results)
Check who are the promoters of the company and their background
Check the debt and D/E ratio ( Do not invest in companies where D/E >1 and Debt is high as they cannot innovate with the
Do not buy shares of companies whose promoter's pledged shares are high.
Check fair valuation by comparing PE ratios
Buy shares only on support ( 20 DMA support)
Avoid Euphoria ( If market gives good news, do not enter in that share at that time. If there is fear in market, avoid selling
Trust your research ( If a share starts falling, do not sell it. Trust your fundamental research)
 It is always better to buy a good company at a fair value rather than buying a fair company at a good value

as they cannot innovate with their cash holding)

re is fear in market, avoid selling at that time)

EMA + MACD + MFI

EMA + MACD + MFI for study a night before on 1D chart

Put 20,50,100,200 DMA
Put MACD
Put MFI ( Shows RSI + Volume)

Pro Tip: When the 20 DMA cuts 100DMA or 200DMA from below and then above and then cuts 50 DMA too from above,
en cuts 50 DMA too from above, it shows the trend has become bearish
Pivot Points

Potential move is detected in advance

It is a leading indicator (as good as price)
It shows all market sentiments

Central Pivot point = (High + Low + Close) / 3

Resistence and support points = (H + L + C)/3 - (H + L)/2

If Closing price is above central pivot point, stock is bullish

If Closing price is below central pivot point, stock is bearish

Buy or sell a stock only when it is touching a pivot point

Do not take any position when it is floating between 2 pivot points

Where to keep SL?

On buy : Nearest Pivot support
On sell: Nearest resistance pivot

NEVER ENTER TILL CANDLE BREAKS PIVOT POINT.

MACD

How to find momentum reversal?

Check the MACD histograms
When the histograms are flat, a trend is going to come.
When there are large histograms and they start becoming shorter after a while, it is a sign that market is going into consolid
Use DMA for support and resistance

Entry and exit triggers

Crossovers are called triggers

How to trade momentum

Never sell after a strong bearish momentum
Never buy after a strong bullish momentum

How to be first to identify trend?

Check MACD Crossovers
Check histograms with MACD line (best way for trend identification)
that market is going into consolidation
Bollinger Bands

Whenever the price touches upper bollinger band, SELL

Whenever the price touches lower bollinger band, BUY

However, confirm this with MACD and RSI

Pro Tip: If BB is narrowed, it is a sign that the price will fall or rise rapidly.
Check the long term trend
If candles are hugging the lower BB for long term, stock will go down.
If candles are hugging the upper BB for long term, it will go up.
MFI

For positional trading you need 3 things:

Price + Volume + Strength
All 3 are taken care by MFI

MFI is a momentum indicator

3 ranges:
0-20 : Oversold
20-80 : Neutral
80-100: Overbought

When to buy and how to buy?

Combine MFI with MACD and check whether to buy or sell

Uptrend or downtrend?
If stock is moving above 50 DMA in short term ot 200DMA in long term, stock is in uptrend and vice versa

For positional trading, buy at every dip and sell at highs. Apply 50DMA + 200DMA + MACD + MFI
If stock is above 50DMA and 200DMA, it is a great time to buy at dips.
and vice versa
Candlestick Patterns

Bullish Engulfing
When a bullish candle completely eats up/englufs the previous bearish candle, it is a sign that markets will go up.
Pro tip: The more the bigger size of green candle than the previous red candle, the better.

Hammer:
When there is a long wick down and hammer on the top, it means buyers have defeated sellers and stock will move up.

Doji:
Neutral ( Indecisive market)
Dragonfly ( Buyer defeat sellers, bullish)
Gravestone ( Sellers defeat buyers, bearish)

If there is a bearish candle before a neutral doji and a bullish candle after a neutral doji, it is a perfect indicator of trend re
The longer the green candle, the more reliable the trend

Bullish Marubozu:
When a long candle is formed with very small wicks or no wicks, it is called Bullish Marubozu and indicates an uptrend.
hat markets will go up.

ellers and stock will move up.

t is a perfect indicator of trend reversal.

zu and indicates an uptrend.

VWAP

Volume + Price
Best indicator for intraday traders and mutual fund houses
Leading indicator
It is a price and not an indicator
No need to use any other indicator while using VWAP

VWAP is an average price of a share traded in a given time frame

Calculation of VWAP
Price Volume PxV
100 1 100
101 2 202
102 3 306
6 608
VWAP 101.33333

What does VWAP tell?

Market sentiment (Bullish or bearish)
Direction of market( Up or down)

Which candle to use?

One day ( For positional trader who trades for a few days or few months or long term)
15 mins ( For intraday trader who plays safe.)

How to trade with VWAP?

When the closing price of a candle is above VWAP line, buy it.
Closing price is higher than VWAP
Always cross check with another leading indicator like MACD

When not to enter trade?

Once you get late
Do not enter if the candle has already moved away from VWAP line
No momentum chasing

Stop Loss?
Low of previous candle
Trail SL
On VWAP( Preferred)
Pro tip: Large candle indicates trend reversal

Pro tip for sell:

Earlier the stock was trading above VWAP and you find an Inverted Hammer
Check the candle immediately after inverted hammer. If it is red, sell because stock will move down.

Pro tip for buy:

Earlier the stock was trading below VWAP and you find a Hammer candle
When a green candle is formed and volume is high, it is a sign that stock will move up.

Focus only on CANDLE, VWAP LINE and VOLUME

DO NOT GET INTO TRADE TILL 10 AM

EVERYDAY USE NEW VWAP. DO NOT FOCUS ON PREVIOUS DAY VWAP
Operator stocks

Who is an operator?
He is a market participant who can drive the market with his excess liquidity

What does an operator do?

Operator gets into position unknowingly and makes sure that no change in price takes place
The price however reacts when too many reatailers get in and then operator exits

How to make profit with operator?

By knowing his entry and exit
Price moves up when he enters and falls when he exits
Tracking operator is important

How is profit made?

Operator leaves behind a trail of volume as he enters and exits.
Operator works on volume and leaves

Enter when volume is increasing and price is falling

Big green bars without change in price is entry of operator and big red bars without change in price is exit of operators

Pro tip :
Whenever an operator enters, he makes sure that the price remains flat
Look for the place where volumes have increased but not price
If price and volume are moving in the same direction, it is not an operator driven move
 LUPIN
AIRTEL
BATA
JSW
TCS

e in price is exit of operators

ADX

ADX < 20 = No trend in market

ADX > 25 = Market is in trend
35 < ADX < 45 = Strong bull trend
ADX > 45 = Market exhaustion
 *
Fundamental Analysis (Art)
Market price may not match the fair value
It is mostly sentiment based
Fundamental Analysis needs thorough research
Fundamental Analysis will tell us the quality of a stock

Technical Analysis (Science)

Fundamental values are already priced in
Stock price moves in trends
History repeats itself ( a share will follow a pattern and will come back to its price in future again)
Technical Analysis tells us what a good price is to enter the stock

Eg: A fundamental analyst and a technical analyst go to a liquor shop.

A fundamental analyst will do the following:
Read Balance sheet
Check PE ratio
Competition analysis
Check Management
Check P/BV ratio
Check quarterly results for at least 3-4 past quarters
Check company's market presence ( it means if the products are regularly used by people)
It is always better to buy a good company at a fair value rather than buying a fair company at a good value

A technical analyst will do the following:

He wont check any fundamental factors
Open company's chart
Compares with best performer amongst its peers
Compare technical indicators ( BB, MACD, RSI, MA)
Fundamental Analysis

Check last 3 QoQ and last 3-5 YoY revenue growth

Check last 3 QoQ and last 3-5 YoY profit growth
Check future price projections ( High, Median, Low)
Check peers and comparison (PE,PB,Div yield)
Compare PE with industry PE
Check 1M, 1Y, 3Y market price trends along with sector and index.
Check Pivot points for levels ( R1,R2,R3,PP,S1,S2,S3)
Do not buy when the stock w=is falling, buy when strength comes in the stock.
Check NSE website for delivery %

Using 1D chart:
Use BB, OBV, MFI
Use 20,50,100,200 DMA and volume chart

20- Purple
50- Red
100- Green
200- Blue
It is important to use indicators which show momentum, trend and volume.

Momentum Indicators:
RSI (leading indicator)

Volume indicators:
On balance volume (OBV)
OBV combines both price and volume to show you the total amount of funds going in and out of the market.

Trend Indicators:
Ichimoku Cloud
Bollinger Bands
out of the market.
Essentials of Portfolio Management

Equity Allocation = 100 - Your Age (23) = 77%

Equity Mutual Funds are also in Equity
Debt Funds = Your age (23%)

How to allocate stocks?

Keep portfolio concentrated.
Restrict to bluechip stocks only.NEVER SELL THEM.
Only add them. Don’t buy any other fresh stocks

When to sell stocks?

Never sell
Sell call options for regular income
Sell call options for a price which will not be reached by the end of the month. Hence, you will get the premium amount as a

When a stock is more than 20% of your portfolio, book profits and bring it back to 20%
When a sector is more than 20% of your portfolio, book profits and bring it back to 20%
When fundamentals of companies are out of place
 Axis
Vedanta
Airtel

will get the premium amount as a regular income.

Stocks for long term

Titan Company
Avanti Feeds
VIP industries
Bajaj Finance
Maruti Suzuki
Escorts
HCL Tech
What comprises price action?

Candle stick patterns (Basis of technical analysis)

Support and resistance ( Heart of technical analysis)
Trend Lines
Demand and supply (Volume at what price)

Golden Rule:
SELL trade only when NIFTY is red
BUY trade only when NIFTY is green

VWAP + Pivot Points

How to select stocks?

5 min strategy (study one day before)
15 min strategy (after market opens)
News based

Pro tip: Study the top gainer and top loser.

Indicators used:

10 EMA
20 EMA
VWAP (for confirmation)
MACD (for confirmation)
Stochastic RSI

Sector Company LTP 10EMA vs 20EMA VWAP MACD vs Signal Stochastic RSI
Banking HDFC Bank 982.75 971.94, 961.12 959.78 4.27, 0.63 90.25
ICICI 344.2 339.55, 336.02 335.22 0.89, -0.67 83.89
Kotak 1279.8 1272.66, 1265.69 1260.62 (0.94), (4.79) 74.43
R3 R2 R1 PP S1 S2 S3