5 AM Trading Club

Day 3 Session

Mindfluential Trading
Co nten ts
Day 1 1 What is Price Action Trading
2 Anatomy of Candlesticks
3 Volume Analysis
4 All about Support & Resistances, Demand & Supply Zones
5 Trends & Trend Lines
6 Chart Phases
7 Putting it all together

Day 2 8 GAPS
9 Effective Chart Patterns
10 Assignment Discussions
11 Master Breakouts & Breakdowns
12 How to identify Fakeouts & Trade Them
13 Playback Market Simulations

Day 3 14 Plotting important levels on the chart.

15 Understanding Trading View Tools & How to use the free trading view version in the
best way possible.
16 Central Pivot Range - CPR
17 EMA & SMA secrets
18 Entry / Exit Strategies
19 How to effectively place the stop loss & trail it.
Co nten ts
Day 4 20 Risk Management - Risk Reward & Position Sizing.
21 Trading Psychology.
22 In-depth Analysis & solutions on Trading with Emotions.
[ Fear / Greed / Regret / Hope / Frustration / Happiness ]
23 Bias Trading - An underrated concept.
24 Why most of the traders have a hard time becoming profitable & How to gain trading Edge
in Trading.
25 Trade Like a Monk: Trading Affirmations & Trading Meditation

Day 5 26 How to Select Stocks for trading.

27 Sector comparison with stocks & Index comparison.
28 Volume Profile Analysis
29 Divergence Concept
30 How to use Institutional Zones & Alert System
31 How to Maintain Effective Trading & Emotional & Review process

Day 6 32 Using Fibonacci levels in the right way to find high probable trades
33 Heikin Ashi candlestick hacks in piking the stocks
34 Detailed session on Futures & Options - covering Basics, Option Chain Analysis, Premium Decay & more.
35 How our Premium Discord Community works.
14,15

Plotti ng I mportant Le vels

Unde rstanding Tradi ng Vi ew Too ls & Le ve r agi ng

Tradi ng Vi ew f ree version to th e b e st w ay p os s ib le
Topic Plotting Important Levels on the Chart brfore starting the trading session.

How important it is to plot important levels on the chart before the trading session begins.

The difference between a novice trader and professional trader is preparation of charts before market opens.

Ideally, you should spend 15 to 20 min in setting up the chart every day
before the market opens or the previous day after the market closes. This
Average trader's chart may look like this, with CPR and
is one of the most important things that many trades fail to do. Even
support and resistance levels S1/R1, S2/ R2 etc.
though they do for few days they give up later. That's the reason many
Now on 4 Aug trader doesn't even know why the price
traders lose. Here we will have a look at how a professional trades takes
which was moving down has been reversed from 21050
advantage of the levels marked on his chart that normal traders don't.
level and started moving up by almost 450 points.

He cannot figure out from the charts because there are

no levels on the chart to indicate potential price reversal.
Also he is not sure why the price is facing resistance at
level near to 21600 levels.

Had be taken any short or long positions in these 2

reversal points respectively he will end up in a loss. Even
though is is aware of CPR it didn't help him in any way.

That's is why a trader should have knowledge of all the

important levels on the chart.

Now lets see how a professional trader chart looks like

 Topic Plotting Important Levels on the Chart brfore starting the trading session.

Now if you look at the same instrument on same day as

above, we have 2 support levels 20150 levels.
1. One is Previous days low which generally acts as support.
2. Previous swing low on 15 July 2020 identified in 1 hour
chart. see the 2nd chart below.

Price reversed from 21600 levels because it has touched

previous days high level, so we can expect a resistance
from that level.

A professional trader have these key levels already

plotted before the day begins so that he is aware of how
the price is going to potentially behave.

This is the advantage of plotting the key levels on the

This is the 1 hour chart of chart before itself.
same instrument where we can
clearly see the previous swing Do this extra effort that other don't do so that you'll be
low from where price has able to gain the edge over good trades that other may
moved almost 1000 points
not get.
upside indicating that there
are many buyers at that
place.

It must be marked as key

support level.
Topic Plotting Important Levels on the Chart before starting the trading session.

What are those important levels that you need to plot on your chart.

5 min / 15 min chart is ideal for day trading in Nifty, Bank Nifty & Stocks

One must have the following levels:

Previous day High & Previous days Low - It is most important to plot as it acts as powerful support/resistance

Support & Resistances - Mark important support & resistance levels, start from higher timeframes.

Mark supply/demand zones - These levels are nothing but where there is significant price reversal that has happened due to heavy
selloff due to entry of aggressive sellers or a significant increase in price due to entry of aggressive buyers.

Mark Gaps on daily timeframe - This is also most important which is often ignored by traders. Gaps happen when there is a significant
GAP ups / GAP down happens due to post-market / pre-market orders, due to global news & because of movement in the US / European
markets / due to changes in SGX nifty, etc.

CPR & Virgin CPR - In the trading view, you can add CPR indicator under Indicators & Strategies as CPR by KGS. It also gives previous
day high low, daily, weekly, monthly pivots within one indicator. It is in the public library and is free to use. Even traders with free
accounts in trading views can make the best use of them.

Previous day close level - It is more important whenever there is a gap up or gaps down.

Current day high / low level - It is a more important mark during the early hrs after the market opens.
Important levels in Daily Timeframe
Important levels in 1 HR timeframe
Important levels in 5 min timeframe
16
C PR - C ent ral P i v o t Ra n ge
Topic CPR (Central Pivot Range) secrets
What is CPR and how why it is very important for a trader to have it on their chart.
"CPR is combination of 3 pivot points called as Top pivot line, Central Pivot line and Bottom Pivot line. We call this entire range as
Central Pivot Range. CPR forms in between daily S1 & R1
RESISTANCE 2
RESISTANCE 1
Top Pivot Line (TPL)
Central Pivot Line (CPL)
Bottom Pivot Line (BPL)
SUPPORT 1
SUPPORT 2
"CPR acts as a dual role. It acts as a
support zone and resistance zone. It helps
identify areas in which the buyers are
likely to support the market OR sellers
are likely to dominate the resistance"
CPR formula
CPL = (High + Low + Close)/3
BPL = (High + Low)/2
TPL = (Pivot - BPL) + Pivot
CENTRAL PIVOT RANGE (CPR)
"Normal Pivots are available in many trading platform
but CPR is not. It is unknown to many traders. You can
simply plot this onto your chart without any manual
calculation. We will let you know how to do that
towards the end. For now focus on the concept"
Topic CPR (Central Pivot Range) secrets

Type of CPR and their importance

There are broadly 2 types of CPR - A) Wide CPR & B) Narrow CPR.
W I D E C P R

Wide CPR generally means that the gap between each pivot line is more
and hence the candles can easily fit into the gaps as shown beside.

When the CPR is wide, it is a indication that the market stays sideways,
it may not be correct always but most of the time it holds true.

Wide CPR acts as strong support / resistance when compared to

narrow CPR. When the candles start below CPR and try to approach
CPR level, there is high changes that CPR acts as strong resistance
and will not let candles pass through the CPR zone.

Same case when candles start above CPR and try to approach CPR
zone, it acts as strong support zone and won't let candles pass
through them easily.

As per our observation we noticed that generally CPR is more effective in

the morning sessions as compared to afternoon sessions.
 NARROW CPR

Narrow CPR generally means that the gap between each pivot line is
very less and hence the candles cannot easily fit into the gaps as
shown. Single candle may be bigger than the total range

When the CPR is narrow, it is a indication that the market could be

trending, it may not be correct always but most of the time it holds true.

Narrow CPR will not acts as strong support / resistance when

compared to wide CPR. When the candles start below CPR and try to
approach CPR level, there is high changes that candles might pass
through the CPR easily.

Same case when candles start above CPR and try to approach CPR
zone, it may not act as strong support zone and candles might pass
through them easily.

You can see the tomorrow CPR after today's market close and these levels
won't change after the market opens and remains same the entire day.

The best part of CPR is unlike other lagging indicators this will remain same
in any time frame as these are fixed levels and not dynamic ranges.
 Topic CPR (Central Pivot Range) secrets

How to use CPR for taking up trades

Generally as long as the candles are trading above CPR, it is indicative of bullish momentum, as long as the candles are trading
below CPR, it is indicative of bearish momentum. It does not mean that you go long when price is above CPR and go short if it is
below. There are many other factors to consider before taking any entry. One must not enter trades solely based on indicators,
there must be a clear price action that support that indication. Our main aim is to capture high probable trades.

Lets consider the following situations during a Wide CPR day: 1- Price opens below CPR 2. Price opens above CPR 3. Price opens inside CPR

1. W I D E C P R & Price opens below CPR

Analyzing reaction to CPR

In this situation where the candles are below the CPR, the general
understanding is it could have bearish momentum on that particular
day.

However in order to confirm the same we need to wait for any other
indication, here once the price reaches to the CPR level, you can see
the CPR zone is acting as strong resistance zone.

Will you short now? NO because we indication doesn't mean a trade

we need price action confirmation so let's go even deeper.
1. W I D E C P R & Price opens below CPR Example - Bank Nifty Index / 13 Oct 2020 / 5 min

Observing Candlestick patterns at key level

Now you must apply the previously learnt CANDLESTICK psychology. If you
see clearly the bottom CPR line is rejecting the price and hence the long
wicks are being formed. Supporting that there is a bearish candle formed
confirming that the CPR rejects the price. Will you enter now?

Ideally NO because we are entering against a bullish trend and we need

extra confirmation that the bullish momentum is over and bearish
momentum is started. For that lets use the other concept that we have learnt
- TREND LINES

Combining Trend lines to get a perfect trade entry

Here we draw short-term trendline towards the bullish momentum in 5 min

chart and once the trend line breaks. It is a confirmation that the bullish
momentum is over and now we can take the short position after a bearish
candle close below the trendline.

This is how we combine CPR (indicator) + Candlesticks + Trendlines (Pure

Price action) for the best trade entries.
Short entry trigger point

You can place a stop loss above the bottom CPR line or mid-CPR line(safer).
2. W I D E C P R & Price opens above CPR

There could be situations like this where price opens just above the CPR and
tries to take support the CPR and then bounces back.

However unless the price movement is confirmed by the price action we

cannot take long or short entry.

In this situation, the price is reacting to the CPR level and making wicks.
Also price is making higher highs indicating bullish momentum. So we can
take a long position once the price is reversed from the CPR and makes
higher high.

Here is a situation where price opened just above CPR and tries to take a
little support at CPR but fails to form a higher high after that and
eventually candles break the CPR zone and comes out of CPR with good
momentum.

It is a good time to short unless there is strong resistance immediately below

the CPR. It is important to look for support and resistances.
3. W I D E C P R & Price opens inside the CPR

There will be situations where candles are struck inside the CPR, It is
a clear indication of No Trade Zone.

You should not take any entry when the price is within CPR because
price will not show any clear direction and it can continue for long
period of time. Just avoid trading that instrument for that day.

Don't force yourself to take up trade even when there is no proper

setup. We should always focus upon high probable trades.

Wide CPR generally mean a sideways market (not always)

When the price opens inside CPR, unless the candle comes out with a
good momentum and forms higher highs or higher lows indicating a
clear direction we should avoid trading.
Topic CPR (Central Pivot Range) secrets

How to use CPR for taking up trades

In a narrow CPR day it does not matter much where the price is opened as it may not act as a strong support or resistance. Also it is
indicative of trending day. In those situation we must use price action techniques to taking up trades and also be ready to ride trends
as once you are able to catch a good trending market you can enter trades with a good risk reward.

NARROW CPR
 Topic CPR (Central Pivot Range) secrets

How to use CPR for taking up trades

There will be may trading days where candles will be far away from the CPR and it wont come near CPR for the entire day. In that
kind of situations the CPR for that day becomes a Virgin CPR and this virgin CPR zone is extended to the coming days as it will act as
a good support or resistance zone when price reaches that level.

VIRGIN CPR
Here is a good example of use of Virgin CPR. since
the candles did not touch CPR the previous day, it
will be extended to the next day and it actsas a
good support

In this situation the price is unable to break the

Virgin CPR. Since the price has touched the Virgin
CPR, it wont be anymore a Virgin CPR for
upcoming days.

If the candles did not touch the Virgin CPR, it

holds good for the next 4 to 5 trading days.

Nearest(recent days) Virgin CPR is more powerful

than the old days Virgin CPR.

Many traders may have question that - What if only the wick touch the CPR but not the body of
candles, can it be still considered as Virgin CPR ?? - The answer is YES it is still a Virgin CPR
17
EMA & SMA S e cr e ts
EMA & SMA Secrets
Topic Secret of 8, 20 & 50 EMA(Exponential Moving Average)

Price action traders do not generally use lagging indicators for trading decisions. However sometimes these lagging indicators will be
helpful few ways.

8EMA, 20EMA, 50SMA are used as Dynamic Support-Resistance

Zones & Entry-Exit Trigger Points
They act as dynamic support and resistance which are helpful for a finding proper entry in trending market and sometimes
signals a potential trend reversals.

Here in a trending market, 8 EMA is first line of support, it provides

support many times. If candles break the 8EMA then 20 EMA gives
the support generally.

When ever you take up trade in a trending market as per your

strategy, make sure you are placing your 20 EMA, so that you have
enough room to ride the profits.

Rarely 50 EMA also acts as a dynamic support / resistance but

generally if candle breaks 50 EMA, it signals for trend change. It
will be used as entry point during trend reversal trading. A good
candle close opposite breaking 50 EMA is a entry indication.
Topic Secret of 8, 20 & 50 EMA(Exponential Moving Average)

Here 20 EMA (green line) has provided support 3 times as shown in

the image.
When you miss first entry in a bull rally, then patiently wait for the
price to get back to the 20EMA and enter once it takes support at
20 EMA and form a green candle.
Exit when the Red candle body close (should not have long wick) below 20 EMA

"Hack - Narrow CPR is indicative of a trending day, So when you

get to see a narrow CPR in the beginning of day, carefully wait
if you can find a trending opportunity"

Here 20 EMA (green line) acted as resistance 3 times as shown in the

image.
When you miss first entry in a bear rally, then patiently wait for the
price to get back to the 20EMA and enter once candle face
resistance at 20 EMA and form a red candle.

Exit when Green candle body close (should not have long wick) below 20 EMA

"Hack - When you get to see much distance between the 3

EMA lines 8 (blue),20(green),50(red) then it is indicative of
trending market. When all of them are nearby, then it is
indicative of sideways market.
Topic Secret of 8, 20 & 50 EMA(Exponential Moving Average)

Most of the time, a good momentum candle close below 50 SMA

can result in trend change, but not always.
18
Entry & Exit Str ateg ie s
 long e ntry pa t te rn s
based on gap up / gap down
1.Gap up bullish

Here the price gaps up and makes a pullback and breaks days high. Entry after candle close
above days high and consolidation.

Tahis pattern is also can be identified as "N" pattern

Gap up bullish - Example

NIFTY 28TH APRIL '21

 long e ntry pa t te rn s
based on gap up / gap down
2.Gap down bullish

Yesterday's close

Here the price gaps up and make a pullback and breaks yesterday's close. Entry after candle
close above yesterday's close and consolidation.

Tahis pattern is also can be identified as "N" pattern

When there is much gap b/w open price and previous day close and if we observe the gap down bullish, we can go long after
the N pattern formation and breakout with SL below the pullback.

NIFTY 11TH MAY '21

 long e ntry pa t te rn s
based on gap up / gap down
3.bullish base violation

Yesterday's close

Here the price gaps up and makes a bearish candle and makes a reversal before breaking
yesterday close and breaks days high. Entry after candle close above days high and
consolidation.
Bullish Base Violation - Example

NIFTY 3RD MARCH '21

 short entry p at t er ns
based on gap up / gap down
1.Gap down bearish

Yesterday's close

Here the price gaps down and makes a pullback and breaks days low. Entry after candle close
below days low and consolidation.

Tahis pattern is also can be identified as "Reverse N" pattern

Gapdown Bearish - Example

NIFTY 26TH FEB '21

 short entry p at t er ns
based on gap up / gap down
2.Gap up bearish

Yesterday's close

Here the price gaps up and reverses to break days low. Entry after candle close below
yesterday close and consolidation.

Tahis pattern is also can be identified as "Reverse N" pattern

Gapup Bearish - Example

NIFTY 29TH JAN '21

 short entry p at t er ns
based on gap up / gap down
3.bearish base violation

Yesterday's close

Here the price gaps up with a bullish candle but could not sustain the momentum and violates
that in the next few candles and breaks yesterday close and days open. Entry after candle
close below yesterday's low and today's open.
When there is much gap b/w open price and previous day close and if we observe the base violation break bearish candle close
below days opening then also we can try to apply this base violation strategy by entering after the candle close below days
opening and SL above days high.

NIFTY 29TH APRIL '21

19
Ho w to ef fe ctive ly pla ce
St oplo ss & Tr ail it
Stoploss should be technically & logically valid

Keeping stop loss is a subjective thing that depends on the trader to trader and trade
to trade but few common things that can be followed to have a best stoploss

1. In a long trade, your stop loss must be secured by one or more support levels. Support can be
anything, be it CPR, Support zone, Demand Zone, Moving averages, Institutional zones etc.

2. In a short trade, your stop loss must be secured by one or more resistance levels. Resistance
can be anything, be it CPR, Resistance zone, Supply Zone, Moving averages, Institutional
zones etc.

3. Take into account Swing Highs & Lows also into account when placing the stoploss

4. Make sure your risk reward is in control, only risk thee amount you can afford to lose
In the below long trade example, one can enter at a breakout or at a retest level.
Stoploss set below is now secured by:
1. Insutitonal support zone (resistance turns into support)
2. Secured by 8 & 20 EMA
3. Secured by Previous Day High (PDH)
4. Secured by Prevous Swing Low

In this scenario, the stop loss is secured by

more than 1 support level. If this is also
matching the risk-reward and position sizing
then one can take a safe trade.

The more levels safeguarding the stop loss the

better chance of trade not hitting the stoploss.

Stoploss is a level where if it hits, your analysis

of entering a trade must go wrong.

Stoploss
Targets / Trailing Stoploss

Keeping targets & Trailing stop loss is also a subjective thing. It varies from trader to
trader & trade to trade. Some hacks are

1. Stoploss can be trailed using moving averages in trending markets. 8/20 ema or any other.

2. In a sideways market one can exit when the target hits. They can also close 50% at the set
target then trail the remaining quantity.

3. In the case of positional trade one can also trail the stop loss based on daily candle close.
Mostly works in rallys.

4. Can be trailed from one higher low to another higher low in case of long trades & one lower
high to another lower high in case of short trades.
q&A Session
 End of day 3 Session
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