Let’s look at couple of more examples, one by one on identifying trading opportunities:

Canara Bank:



In the above chart, Canara Bank Future made a Low on 7th Jun at 401.50. It then made a High at 434.50 on 15 Jun, making a range of 33 points. Instead of trying to get in, we start looking for it to retrace (i.e. go down) and mark our points 1 and point 2 at Rs. 401.50 and 434.50 respectively. Now we wait for Point 3.



We get our Point 3 on 18th June 2010 at 415.50. This is the time we prepare our trading plan as under:

Point 1 : 401.50 – 7 Jun

Point 2 : 434.50 – 15 Jun

Point 3 : 415.50 – 18 Jun

Entry Price : High of Point 3 Day + .05 = 424 + .05 = 424.05

STOP LOSS : Point 3 – 0.05 = 415.50 – 0.05 = 415.45

Target : Point 3 + Range = 415.50 + 33 = 448.50

Let’s see what happened next day:



Canara Bank futures crossed 424.05 and we enter the trade. What happened in next few days:



Target of 448.60 achieved on 28th June 2010. WoW !!!!

Profit of Rs. 24 (approx.) in about 10 days. In % – 5.5% of Stock price and in Futures, a profit of about 25%…

Good or GREAT!! you decide

Now a practice / opportunity for you. There is a Long trading opportunity in Canara Bank Futures recently thrown. I will give you Point 1 and Point 2 dates only. Point 1 – 14 Jul @ 466 and Point 2 – 19 Jul @ 565.25

You figure out the rest of the trading plan. If you want me to check it, you can send the same to me :
sumit@sumprati.com