iCharts Discussions

[vijayakannan]

if anybody had started trading in Nifty with an investment of 20000 in 1/4/2005 as per this strategy, and using all the profits to continuously trading under the same strategy , due to compound effect it would have become 60 crores by now.

This is nothing new. one of the oldest strategies (is it a strategy first???)

In EOD chart

1. Buy above 34 EMA. Sell when price cuts 8EMA from above.
Again buy when price crosses above 8EMA (provided it is above 34ema) and sell when again it comes down 8EMA
2. Short sell below 34 EMA. Buy back when price goes above 8EMA. again short sell when price goes below 8ema (provided it is still below 34 ema)

open icharts (EOD) for nifty . set 5 years period. select 8ema and 34 ema. and see the charts. you will find it.

i have conservatively considered 20% margin for nifty , and 10points per lot per trade as expenses towards brokerage etc.

it is a plan which will work both the times. bull or bear. attached an xcel file for calculation too

we may say that it wont be possible for nifty to move again like this past 5 years. if we see the chart for last 2 years it is visible that nifty will keep on moving either side. it is upto the traders to make use of it

[rajamani]

Amazing,does this works for stock futures & other index futures

[kalsree]

looks interesting. can you please show it with the use of chart too. this will help us to understand better
kalyan

[ConMan]

Dear Vijayakannan

EMA always give you huge profits & have very less whipsaws if used in longer Time Frames. Its no surprise that one would have made hell lot of money by just using EMAs in trade.

Again I want to stress the fact that its not the strategy but mindset or attitude thats more important. I dont know how many out of 100, would allow their profits to run???

Your strategy is simple & very effective, but we as human beings like complicated stuff and will never believe that we could make so much money with such a simple strategy. My system also involves EMAs only

Thank You for bringing this Sir....hope this gives confidence to people that simple strategies also work.

RegardsQGM

[vijayakannan]

kalsree, i dont know how to save a chart in icharts and upload it here. it is very simple. just open jcharts EOD. select last 5 years data. in EMA select 8 and 34. when ever crossing happens do the trade. thats all.

rajamani i have not tested this for other stocks or other indices like bank nifty. but for bank nifty i think we have to choose a higher EMa as it is very volatile and will give u a lot of whipsaws and wrong signals (Losses) . but i have not tested it.

thanks Quick gun murugan. it is correct. we dont know whether we will allow profits to accrue and continue the same trade. but if we have a mind set that what ever it is we are going to lose only 20000 , then may be we would have.

[cpsinghvi]

i don't understand this.Can you suggest when to buy nifty tomorrow i.e., on 29th December .my email id is [CONTENT REMOVED BY ADMIN]

[tripathi_manu]

Well, when mkt does not trend ur trades may fail. So when will mkt trend?? How to know that? If one enters right on the beginning of the trend that will be they key of success. Else you will find it difficult to protect ur capital. ….whipsaw….....

So gentleman, it is requested to include that part also in the calculations.
The only thing I am afraid of is a Non-Trending market.


Regards.

Manu

[asundar]

this post is really good but, important question remains unanswered..... how to predict market trand? Of course, one can catch market trend....

[vijayakannan]

sundar, u dont need to predict market trend. EMA will not predict market but follows it. . so when following EMA you will follow market. It is wiser to follow market than to predict it.

Manu, in a sideways market we will not gain more in this strategy. but sameway you wont loose much . since market is in sideways the EMA will be more or less same. the only issue will be there will be lot of trades, but with no big profit or no big gain. you may see that from that chart or from calculation that during those periods we may have lost some points say around 150 pts but normally once this whipsaw is over there will be a big move and you will be able to catch of that which will be much higher than the 150 pts loss.

sanghvi, sorry, i dont give any calls here. it is just a simple thing. pls read charts and you will understand when to start the trade. i am not an expert to give calls.

vijay

[venkchandra]

Hi Vijay,

Your obervation and rule of trading is really nice and worable. Rule is same for any time frame i.e 10minutes, 30 mintes etc so that can be used for intraday.

Thanks for sharing.


regards

Venkatesh

[ConMan]

Dear TMU....

The whipsaws are definitely an issue in EMA .... but not at all a major one.... Ppl think EMAs are not good because they have this false impression that it takes away lot of your profits...

Yes it does affect your confidence on the system sometime....but once you are used to it you will know the power of trading basis EMA crossover...

Rgds
QGM

[greatshiva]

Hi tirupathi_manu,

Whatever you are calculating now is the EOD EMA but during live mkt , the daily EMA cannot be looked back after the day is over.

Hence you cannot back test this method.

The EMA might give a crossover signalduring live mkt hours signalling to buy at 12 PM but at 15:00 PM , the ema might turn back and at EOD what you see is a diff EMA.

Crossing of EMAs work but has lot of whipsaws

Sometimes , there might be 300 pts loss in a single trade watiing for crossing back due to this whipsaws... If u r ready to bear all that oonly then u hav to trade....

Do paper trading before getting into this....

[ConMan]

Shiva we take positions basis EoD EMA only (say 3.25pm) and not during live market hours...

I do understand when you say we may see heavy losses sometimes....but if you continue with this systems for long the losses become irrelavant

[kishorepatnaik]

Dear Quick gun Murugan,

Can you please explain the rule? Sorry that I could not understand it. I understand the words EMA and SMA.

regards,

Kishore patnaik

[kripalsinh8888]

HEY ! vijayakannan........

Its a very gud strategy.......infact just a use of simple logic........

by the way if u dont mind .........i wanted to ask u tht how long have u been trading with this strategy..........n if u dont mind could u plz add my id in ur msger : [CONTENT REMOVED BY ADMIN]

I wanted to discuss few thingz abt using EMAs........

With regardz ,
Kripalsinh