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Sure & Simple way to make profits in a downtrend

+9
prasadrmb
K.Haputantri
swan03
smallville
chamith
sriranga
Slstock
stumpy
hunter
13 posters

Go down  Message [Page 1 of 1]

hunter

hunter
Moderator
Moderator

Guys, just thought of sharing something useful. To earn 10% or more in a month with 90% probability.

This is one of my own tools. May be this is a well known technique and I am reinventing the wheel; or may be not. If someone knows a better way pls share.

Please note: if you want to use it do your own study first. Nothing will be 100% guaranteed to work.

Why I want to use my own methods:
There are hundreds of tools and techniques intended for profits in stock markets. But what I have experienced is most of them do not work in CSE.

Why?
I am not sure. May be liquidity of CSE counters are not enough. Or may be our market size is not big enough. Or may our shares are not driven by any fundamental reason.
Whatever the reason, standard methods did not work for me so.... what else to do.

I would call this technique 'Attacking the rear end'.

You must have seen (in Discovery channel) lions hunting buffalo herds. They (lions) never attack the front of the herd (sure way to get stabbed). They follow the herd and attack the slowest and isolated buffalo.
That's how I got the name.

For this technique, I prefer to use the tool 'Standard error channel' but, there was a problem. It was not user friendly in DirectFN. So I use a substitute; 'Bollinger bands'

For Bollinger bands, the parameters I used: time periods-40, Method-Simple, Deviations-1.25

ok. This is how I use it for;

Down trending (Low liquidity) shares.
===========================

Use the said Bollinger bands for 6 months daily chart. Observe the trend in general. Observe the gap between the middle and the lower bollinger band lines (1.25 deviation). Check if the price drops to around 1~1.25 deviations from the 'lower band'. If so, buy!
The sell target will be in between the lower band and the middle.

An example is given below; hope it is self explanatory.

https://i.servimg.com/u/f47/16/67/25/58/tpl10.jpg




This is how I use it for;

Sideway trending (Low liquidity) shares.
============================

Try to buy near the lower band. The selling target will be between the middle and the upper band.

An example is given below.

Sure & Simple way to make profits in a downtrend Lioc10

https://i.servimg.com/u/f47/16/67/25/58/lioc10.jpg

I have used the above with a reliable level of 80~90%
If the share is high liquidity, this can be improved further.

Hope I was able to do a little eye opening.

Remember two things:

1. This is to be used in a downtrend.
2. I am still a Simple Swing Trader.

stumpy

stumpy
Senior Manager - Equity Analytics
Senior Manager - Equity Analytics

Keep up the good work boss!
Expect greater findings from you in future as well! Way to go...!

I'm still using your strategy to identify Market Cycles!
I can be applied to any market! Very Happy

Thanks again!

Stumpy!

Slstock

Slstock
Director - Equity Analytics
Director - Equity Analytics


Very interesting. Thanks for sharing.

Except for "passen gehin anina" part without real confrontation. Laughing Laughing

sriranga

sriranga
Co-Admin

Thanks for sharing interesting strategy.
Keep it up.

http://sharemarket-srilanka.blogspot.co.uk/

chamith

chamith
Assistant Vice President - Equity Analytics
Assistant Vice President - Equity Analytics

bollinger band shows the volatility of a share.
If the band is well expanded that means the volatility is high,

Best way is to wait till the candle sticks drop alone with the lower band (Touching the lower band). If the candle sticks go out of the band that means a unusual volatility. This will widen the band at the same time. On the next candle stick that shows de attachment from the lower band, is the time to enter the trade. If things go well profit can be accumulated till the centre line of the band or beyond even.

Eg:
RHTL
Sure & Simple way to make profits in a downtrend Untitl10

But this tool should be used with a conformation from other indicator too.
Eg:
SAMP
Sure & Simple way to make profits in a downtrend Untitl11

smallville

smallville
Associate Director - Equity Analytics
Associate Director - Equity Analytics

Great work hunter.. I've been using the Bollinger band technique for most of the swing trading all this time and I miserable failed on "FLCH" Wink
I bought after a few candles down the lower Bollinger and to my surprise it went further down.. he hee..

But this technique also can be used on a sideway market where a potential security fell over its normal trading range...

Sometimes its important to check the lower Bollinger line with support levels for buying and pull back levels for re-buying (cuz the info are more accurate then). Then resistance levels for sell offs..
There's a whole lot of Bollinger band patterns to refer for confirmative trading..
Just my 50 cents...

swan03


Vice President - Equity Analytics
Vice President - Equity Analytics

Great!! Im gonna try this. Thanks hunter.

stumpy

stumpy
Senior Manager - Equity Analytics
Senior Manager - Equity Analytics

For newbies,

Don't do experiments with Real Money!
At least do it 10-15 times in Paper Trading & Countless times of back testing!
If not you'll be in trouble for sure!

Any share can be bullish/bearish for a longer periods of times... (under RSI 30/over RSI 70 or touching lower/higher BBs) may be even for years!

Stumpy

@Chamiya
Good to see another fast learner! Smile
Way to go bro!

K.Haputantri

K.Haputantri
Co-Admin

Great explanation hunter. This is very usefull to members but my DirectFN has problems. I am unable to get historical charts. Only intraday charts appear. When switch over to history just one day data is shown. I don't know whether it is my lack of knowledge of the software or software itself. ?Can any one explain step by step procedure to get historical charts.

prasadrmb

prasadrmb
Manager - Equity Analytics
Manager - Equity Analytics

great work hunter
thank your for sharing your experience with us.

Light of Hope


Vice President - Equity Analytics
Vice President - Equity Analytics

Thanks for shareing

Deva


Senior Manager - Equity Analytics
Senior Manager - Equity Analytics

This sounds great, hunter.
Unfortunately, everybody doesn't posses the DirectFN trading facility (depends on trading facilities of the broker firm).

FXX

FXX
Senior Manager - Equity Analytics
Senior Manager - Equity Analytics

Thanks hunter

These 3 E-Books got more info

Combining Bollinger Bands & Rsi
Dennis D Peterson - Developing A Trading System Combining Rsi & Bollinger Bands
Technical Stock Analysis - Bollinger Bands And Rsi

http://www.2shared.com/file/plDK7QVU/bb_online.html

Kumar

Kumar
Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics

Good. Thanks for sharing.

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