22 March 2014

IMPORTANCE OF STOP LOSS IN NIFTY

We bring forth a Research study, through which you can use to replace the buy and sell logic with your own, and use the techniques as a platform, which you may use that will show transaction profits and target milestones.
Any trading system will never deliver profits unless you have an appropriate exit strategy combined with your risk management and trading rules.
One approach is to used to fixed targets based on Risk Reward Approach.
For example : If you put a stop loss of 15 points, then use a target level of 1:1, 2:1 and so on….  i.e. targets of 20/30 points and so on.
A second approach can use the ATR for the time frame in question.
 For example if the ATR of an instrument is 10 points in the 5 minute charts, you can use multiples of this number as your target.Stop losses should be combined with Risk Management Approach to prevent unusually high risks to be taken. We stress on this at the end of this Research....
Very important : While not specifically mentioned for any of the trading styles, be aware of recent supports and resistances for consideration for stop losses and targets.

2 comments:

  1. Very informative blog. For nifty trend Check option

    ReplyDelete
  2. The language of the article is very simple, it is very easy to understand. Check option

    ReplyDelete