This is the first basic and most asked question by the traders, that how we can make money from the stock market, so here is the article for you, to understand the complete trading. First, you need to understand the share market and the main thing is you need to trade, Either a small QTY ( 1 Share ) but make sure you do a proper trade and not just a paper Trading. When you just keep a watch on the share you will not understand the actual position. So make sure, you execute the order either with 1000 Rs or 10 Lacs. If you are a beginner and want to trade under proper guidance, they must take our stock future tips package where you will get all the recommendations with proper technical knowledge and after checking all the news about the market.
Let us start now, with my strategy of Trading:
Always Trade in Up Moving Average Trade: I Always Trade/Invest in a share For Buy Position only when the Moving Average (21 Days) showing Up Trend. When we trade for an intraday, we will choose 15Min, 30 Min Charts and when we are doing a swing trade we will check 1 Day Chart. So let us understand with Charts, the meaning of uptrend and the meaning of downtrend.
It’s a Daily Chart Of HDFC and with 21 Day EMA ( Moving Average – It's 21 Days Closing price Average of Stocks and a line will be drawn automatically by the software). In the First Scenario, Chart shows a complete Downtrend, So here traders made a mistake and Buy the Stock which is completely wrong, If you are an investor then this stock totally needs to be avoided by you. In the Second Scenario stock showing sideways movement that is no trade zone in the stock. So it's better if you avoid the Stock and Now in the third scenario we have an uptrend and it's a perfect trade setup to Buy the stock. Now the question that arises is when to buy the stock, so let's discuss and understand
When to Buy The Stock?
As we discussed the HDFC Chart, Now let's check from HDFC only. The answer is you need to buy the Stock, When stock is nearby 21 Days Moving Average. Check-in Chart the arrow we have shown, First Buy Price is at 1950 and Second Buy Price @ 2200 and stock moved up to 2600.
When to Exit The Stock?
Exit the stock depends on the client's Risk Reward Ratio the strategy I follow for Exit the stock is I Keep a Risk Reward Ratio of 1:2. For Example, If buy The Stock HDFC @ 2000 And My Target is to earn 5% From the stock, as the stock is in a good uptrend and 5% is not a Big Deal in stock Like HDFC, So My Target here will be 2100 and SL I will keep for 2.5% that is 2050. If the stock price goes below 2050 then I will exit the stock at any cost.
Mistake Done by Traders
Traders Make a mistake that they don’t follow the Stoploss, Make sure whenever you make an Entry in the Share market you have a stop loss in your Trading System, Not in your mind, it should be on your trading system, and never modify or cancel your SL. If the SL HIT, leave the trade and carry on to your next trade. If you keep holding 1 stock only, below the SL then you Block your capital and will miss other profitable trades
Conclusion and Note
This is the very basic setup of Trading for a beginner, you need to start with this strategy, Here you need to find out the different types of stocks and need to note down all the stocks which are in an uptrend, and once you find all these stocks, you need to place alert nearby the 21 Days Moving Average. So whenever alert triggers, you will get the notification and you can place your order. Hereby reading this article, we can conclude that you find it a timely process to do this, so that’s why we are here for you providing daily intraday option tips and we are known as one of the best option trading tips providers companies in India.