1. This system can be used for both intraday and positional trading.
2. To use this system, you must enter the high, low and close for the time frame, you want to trade.
3. If you want to trade for a time period of one week, take the high,low and close of the last 5 days.
4. If you want to trade for a time period of one month, take the high, low and close of the last 30 days.
5. Similarly for one year.
6. In all above cases you take the closing price as closing price of previous day.
7. If you want to trade intraday, you should take the high, low and closing price for previous day.
Now lets take an example for trading 1 week time frame
Example - 1 week
1. I note down the high, low for the last 5 days for any scrip (say TATASTEEL).
2. I take closing price as closing price of previous day.
3. Lets say they are 625.70, 551.70 and 569.10.
4. I get three buy signals.
Go Long at / above 551.7. Keep Stoploss at 551.14. Target 1 is 579.96.
Go Long at / above 562.5. Keep Stoploss at 551.14. Target 2 is 598.46.
Go Long at / above 576.19. Keep Stoploss at 562.5. Target 3 is 621.92.
5. Based on this call, I will try to buy at 551.7 for target of 579
If i am able to buy at/above this price, i square off at target 1.
I then wait for price to come near second buy level ( 562.5).
I again try to buy at/above 562.5 with target of 598.46 this time. (I also buy at this price if i could not buy at buy price of 1st signal(551.7).
If my target 2 is achieved, i squareoff at target 2. I now wait for price to come near buy signal 3 ( 576.19).
I buy again at/above 576.19 for target of 621.92
Example - 2 Intraday
1. I note down the high, low and close for the previous day for any scrip (say TATASTEEL).
2. Lets say they are 594.60, 570.65 and 573.
3. I get three buy signals.
Go Long at / above 570.65. Keep Stoploss at 570.07. Target 1 is 579.79.
Go Long at / above 574.14. Keep Stoploss at 570.07. Target 2 is 585.78.
Go Long at / above 578.57. Keep Stoploss at 574.14. Target 3 is 593.37.
4. The next day, low for TATASTEEL was 577.10. So i could not buy at 1st and 2nd buy signal prices.
But if i take risk and enter the long at 3rd buy signal (578.57). I wait for target 593.37
The high made for the next day was 603.6. (Our target achieved.)
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