Swing trading

[andysteven]

I do scapling in Nifty Options and I would like to share a few points as under :

1) I need approx 3 points in Nifty options to take cate of exchange charges,low brokerage and STT and also a few wrong trades which always happen irrespective of what we do. So if I am scalping At The Money options ,it means the nifty should give me a move of 6-7 points in direction of my trade that too very quickly.

2) I select my place for scalping .....such as when a hourly bar's bottom gets broken, or a important pivot gets taken out,break of a trend line,failure of breakouts/breakdowns....these are places where the counter gets into high activity mode,the moves are strong and fast. I can achive my targert move in less than a minuts in the trade. Sometimes I got even 6-8 points in such scalps agaist 3 to 3.5 points which I am looking for.....Though this is not scalping strictly....it is actually trading breakouts for small price move.....but whatever it is called ,these quick scalps suit my mental set up.

3) Sometimes bid/ask spread gets wide....in this case try to buy at lower side of the spread and sell at higher side.....this is to be tried in stable markets...not in trend moves because mkts are likely to jump in trend moves....

Again here are some stocks
where earnings have been raised but stock prices have underperformed: these represent opportunities for investors.

Bajaj Auto (BJAUT Rs1587),
Hero Motocorp (HMCL IN, Rs1863),
Zee Enter (Z IN, Rs125),
Hindustan Unilever (HUL IN, Rs392),
Dabur (DABUR IN, Rs94),
Cipla (CIPLA IN, Rs342),
Infosys (INFO IN, Rs2660)
TCS (TCS IN, Rs1097),
Wipro (WPRO IN, Rs419)
Satyam (SCS IN, Rs72),
NTPC (NTPC IN, Rs175)
GAIL (GAIL IN, Rs366),
Power Grid (PWGR IN, Rs101)

I might not be a greatest analyst but as i feel after alalysing the stocks from technical analysis tool of Dynamicslevel.Com, i feel Sector-wise banking stocks that can be quite bullish at future, since the tool is giving instant updates, so on its basis i have built my perception regarding

I look at the management first. The management is the most important and lest talked about aspect of a company.

2) I like to know what business the company is into and then look at whether it is scalable. I prefer new sectors since the growth is highest there. I avoid cyclical because I cannot predict the peaks and troughs.

3) I then look at the market cap. If it is below Rs 1000 crores I think we could pay a higher PE to that company

4) I would then look at the RoE to see if the company is using its capital efficiently. RoCE is a better concept though because you could hike the RoE by using debt but not the RoCE

5) I would then compare the PE with the growth and the RoE. If there is a big difference between RoE and growth then the company does not merit investments. This is so because for a company to grow at higher rates of growth compared to its RoE it would have to dilute capital. That hurts

6) Dividend, book value is something that I look but do not base any of my decisions upon. I think that they tell you what the company has done and not what it will do.


NAME CMP SIGNAL S/L


AXISBANK 870.10 BUY 855.40

ICICIBANK 744.85 BUY 740.70

IDFC 137.60 BUY 135.20

KSOILS 56.20 BUY 54.35

ORIENTBANK 168.10 SELL 171.25

RELINFRA 1188.15 BUY 1163.10

 

[farhanak.manage]

Hey Andy, thanks for sharing your experience.

I tried absorbing but looks like im a newbie at it and need a lot of reading to do.

It's nice reading your perspective though. Looking forward to more such contributions.

 

[andysteven]

Effective mantra of swing trading

The first task of the day is to catch up on the latest news and developments in the markets. The quickest way to do this is via the cable television channel CNBC or reputable websites such as Market Watch. The trader needs to keep an eye on three things in particular:

1. Overall market sentiment (bullish/bearish, key economic reports, inflation, currency, overseas trading sessions, etc.)
2. Sector sentiment (hot sectors, growing sectors, etc.)
3. Current holdings (news, earnings, SEC filings, etc.)

Typically, swing traders will enter a position with a fundamental catalyst and manage/exit the position with the aid of technical analysis. There are two good ways to find fundamental catalysts:

1stly
Special opportunities often carry a large amount of risk, but they deliver many rewards to those who carefully research each opportunity. These types of plays involve the swing trader buying when most are selling and selling when everyone else is buying, in an attempt to "fade" over-reactions to news and events.

2ndly
By analyzing the news or consulting reputable financial infThese types of plays involve the swing trader buying into trends at opportune times and riding the trends until there are signs of reversal or retracement.

Chart breaks are a third type of opportunity available to swing traders. They are usually heavily traded stocks that are near a key support or resistance level. Swing traders will look for several different types of patterns designed to predict breakouts or breakdowns, such as triangles, channels, Wolfe Waves, These types of plays involve the swing trader buying after a breakout and selling again shortly thereafter at the next resistance level.

You will often find that entering trades is more of an art than a science, and it tends to depend on the day's trading activity. Trade management and exiting, on the other hand, should always be an exact science.

I may not be a great technical analyst but i uses this stock market analysis tool of Dynamicslevel.com to get the ready stock tips which has come to great help now a days for my daily trading.

I will again say about more tips on swing trading
Thank you
Andy steven