Trading with Median lines is a system and a leading indicator suitable for Swing trading.I am following this strategy for Nifty and Bank Nifty with good results.Those interested to trade with Charts and Price action to analyse target price, support and resistance levels will find this strategy very interesting.

Feedback welcome!Happy trading...

Monday, January 24, 2011

Trade Setups - 50% R in Pullback

Stock charts with 50 % R Pullback setup

My rules for this Setup
  • Identify a Up or down swing.Wait for a pullback thro 50 sma.The distance below and above 50 sma to be more or less equal.
  • Draw a Median Line thro the pivots of the pullback swing.
  • If downsloping Pitchfork then Short or vice versa.
  • When price crosses 50 % level of pullback swing and 50 sma, Sell in downsloping Pitchfork / Buy in upsloping pitchfork.
  • Stoploss level will be at bar high above 50 sma level
  • Risk/ reward to be calculated before entry.1:2.5 -3 minimum to be maintained.
  • Target levels will be Target1- previous swing low or vice versa,Target 2 will be meeting point at Median Line and further down at LML.
  • To trail profits , Stoploss of close above / below 10 ema , (or ) 5 / 20 ema crossover to be used.

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