BANK NIFTY POSITIONAL | LOSING TRADE | BREAKDOWN AND SETUP
Hi Traders,
Everything seemed Perfect for this positional Trade.
Entry on 7 Jun
Exit on 10 Jun
LOSS PER LOT - INR 7500/-
PROFIT PER LOT : INR 23000/-
This Futures position was hedged with a PE of the index.
Though we had multiple confluences , I never trade without a stop loss
Now in the case of bank nifty , the daily volatility is in the range of +-300 points , hence it did not make sense purchasing naked futures and maintaining a Stop LOSS Trigger as any normal move of bank nifty could trigger a stop loss
A PE was purchased to CAP the maximum loss per lot to 7500 /-
Now if you notice on the charts , without PE , I would've been stopped out immediately on the same day
Because the position was HEDGED , I was able to carry the trade for 4 days
Also note the margin requirements for a HEDGED position reduces significantly (Almost 1/4th)
Respect the Markets and Trade with a strict stop loss. LIVE ANOTHER DAY !! Keep This Information Handy and Happy Trading.
NOTE : HAD THIS BEEN A NAKED FUT TRADE , THE PAIN OF SEEING A NEGATIVE P&L OF 20000 /- PER LOT WOULD MAKE TRADERS TAKE EMOTIONAL AND IRRATIONAL TRADING DECISIONS. ALWAYS TRADE WITH STOP LOSS AND ENJOY WHAT THE MARKET OFFERS :-)
******* KEEP A CLOSE WATCH FOR A BREAKOUT ABOVE THE LEVEL OF 35500 AGAIN FOR BUY *****
Everything seemed Perfect for this positional Trade.
- Price attempting to breakout resistance for the 3rd time
- Build up at resistance
- Price moving in an Uptrend
- Support taken from Trendline
- Hammer like formation showing buying presence
Entry on 7 Jun
Exit on 10 Jun
LOSS PER LOT - INR 7500/-
PROFIT PER LOT : INR 23000/-
This Futures position was hedged with a PE of the index.
Though we had multiple confluences , I never trade without a stop loss
Now in the case of bank nifty , the daily volatility is in the range of +-300 points , hence it did not make sense purchasing naked futures and maintaining a Stop LOSS Trigger as any normal move of bank nifty could trigger a stop loss
A PE was purchased to CAP the maximum loss per lot to 7500 /-
Now if you notice on the charts , without PE , I would've been stopped out immediately on the same day
Because the position was HEDGED , I was able to carry the trade for 4 days
Also note the margin requirements for a HEDGED position reduces significantly (Almost 1/4th)
Respect the Markets and Trade with a strict stop loss. LIVE ANOTHER DAY !! Keep This Information Handy and Happy Trading.
NOTE : HAD THIS BEEN A NAKED FUT TRADE , THE PAIN OF SEEING A NEGATIVE P&L OF 20000 /- PER LOT WOULD MAKE TRADERS TAKE EMOTIONAL AND IRRATIONAL TRADING DECISIONS. ALWAYS TRADE WITH STOP LOSS AND ENJOY WHAT THE MARKET OFFERS :-)
******* KEEP A CLOSE WATCH FOR A BREAKOUT ABOVE THE LEVEL OF 35500 AGAIN FOR BUY *****
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