5 Advanced Counter Trend Trading Techniques
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Advanced Counter Trend Trading Techniques
IntradayMoney.in
www.intradaymoney.in
Major Price Action is trending upward and you are focused on SHORTING
Major Price Action is trending downward and you are focused on going LONG www.dailyniftytips.in only Majorsure Priceshot Action is trading in a sideways consolidation pattern and tips..!
Your focused on price action trending upward or
Your focused on price action trending downward
Price Action gaps
Up and you are focused on FADING the gap
Down and you are focused on the gap FILLING
Price Action is relatively
IntradayMoney.in
Strong in multiple markets and your focusing on weak price action setups for shorting
Weak in multiple markets and your focusing on strong price action setups for going long
www.intradaymoney.in Price Action
www.dailyniftytips.in only sure shot tips..!
Ideal trading situation
IntradayMoney.in ENTRY
LONG Entry •Up trend •Higher Highs & Higher Lows
4
4
www.dailyniftytips.in only sure shot tips..!
www.intradaymoney.in Price Action
4
Ideal trading situation
4 4
Natural pullbacks &
IntradayMoney.in
4
counter trends in price action
ENTRY
LONG Entry •Up trend •Higher Highs & Higher Lows
Look for declining volume on pullbacks
4
B 4
3
www.dailyniftytips.in 2 1 only sure shot tips..!
Parallel
C
www.intradaymoney.in Price Action
4
A
4 Flags
4
Natural pullbacks
IntradayMoney.in
4
in price action
ENTRY
Major Up Trend •Higher Highs & Higher Lows
Higher highs and higher lows provide evidence of uptrend
www.intradaymoney.in 20 MA
Setup Signal
www.dailyniftytips.in
•2B/3B Candlestick Reversals •Crossingonly MA’s sure shot tips..! •RSI – Short/Sell signals •Stochastic – Oversold signals •MACD – Down trending histogram •Volume decreasing •Divergence •No Upside Follow Thru
B 3
200 MA
2 1
Major Trend
IntradayMoney.in C
Flag
A
Trading against the major trend
•Higher timeframe uptrend
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Focus on Speed of uptrend Long Setups
1. Sideways Bottoming Action
3. Sideways Topping Action
Focus on Speed of downtrend
IntradayMoney.in Short Setups
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Minor support area
IntradayMoney.in Major support areas
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Bullish
Bearish
Engulfing
Engulfing
IntradayMoney.in 50%
Bullish 50%
Piercing
Bearish
Piercing
www.intradaymoney.in
www.dailyniftytips.in Countertrend only sure shot tips..! Setup
Countertrend Setup 3. Sideways Topping Action
3-Bar Bearish Reversal
3-Bar Bullish Reversal Bull Trap Bear Trap Bullish Piercing Bullish Engulfing Opening Range – Higher Low
1. Sideways Bottoming Action
IntradayMoney.in Bearish Piercing
Bearish Engulfing
Opening Range – Lower High
1. Sideways Bottoming Action
www.intradaymoney.in Countertrend Setup
4
www.dailyniftytips.in only sure shot tips..!
Price Action
4 4
Ideal trading situation 4
Trying to trade the natural pullbacks
IntradayMoney.in 4
ENTRY
LONG Entry •Up trend •Higher Highs & Higher Lows
www.intradaymoney.in Countertrend Setup
20 MA
Reverse Entry Signals & Trading Doubt www.dailyniftytips.in
only sure shot tips..! •2B/3B Candlestick Reversals •Crossing MA’s •RSI – Short/Sell signals •Stochastic – Oversold signals •MACD – Down trending histogram •Volume decreasing •Divergence •No Upside Follow Thru
B 3
200 MA
2
1
Major Trend
IntradayMoney.in C
Flag
A
Trading against the major trend
•Higher timeframe uptrend
www.intradaymoney.in
Most traders are NOT aware they are counter trend trading price action until they
are actually in the trade and managing it. www.dailyniftytips.in only sure shot tips..!
Often, the speed of the uptrend can assist traders with determining the profit opportunity and “odds” of success for counter trend trading
Aggressive up trends often have aggressive retracements
Setups, Signals, and Strategies have to be very focused and fast for entry to maximize potential profit
IntradayMoney.in
Remember counter trends are short in duration
Very dependent on the timeframe for performance
www.intradaymoney.in
Often traders loose trying to accurately trade the countertrend paradigm
Buying New Lows: www.dailyniftytips.in only sure shot tips..! “Bottom-fishing” to pick the market bottoms and focus on exactly getting in at the low of the price action downtrend.
Traditional trading suggest waiting for confirmation that support has held and prices are moving in an uptrend with higher highs and higher lows
Selling New Highs:
of the price action uptrend.
IntradayMoney.in
Traders trying to pick the market tops and focus on exactly getting out or shorting at the high
Traditional trading suggest waiting for confirmation that overhead resistance has held and prices are moving in a downtrend with lower highs and lower lows
www.intradaymoney.in When countertrend trading know:
Support and resistance levels where traders identify entry and exit opportunities when www.dailyniftytips.in trading. only sure shot tips..! Fibonacci percentage "retracement" levels where savvy traders use them to improve their entry and exit points.
How traders often try buying into support ▪
Buying breakouts in an uptrend is often chasing the move; similar to buying new highs or shorting new lows
How traders often try shorting into resistance ▪
IntradayMoney.in
How traders often try buying a breakout ▪
If the major price action trend is in a downtrend, more than likely, it will continue
If the major price action trend is in a up trend, more than likely, it will continue
How traders often try shorting a breakdown
www.intradaymoney.in
www.dailyniftytips.inTrading with the trending price action. only sure shot tips..! Use Fib levels, sideways consolidation and Breakouts for BUY signals
2
3 1
2
1
3
IntradayMoney.in Use Fib levels, sideways consolidation and Breakdowns for SHORT signals
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
1
2
3. Sideways Topping Action
2 3
1. Sideways Bottoming Action
3
IntradayMoney.in 1
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! Chart pattern
3. Sideways Topping Action
Chart pattern confirms sell signal
confirms buy signal
IntradayMoney.in 1. Sideways Bottoming Action
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! Aggressive Short
3. Sideways Topping Action
Aggressive Buy
IntradayMoney.in 1. Sideways Bottoming Action
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Chasing The Markets
Excessive Losses
Lack of patience and discipline
Tunnel vision in reference to market conditions
Inter-market Analysis
Improper money management or risk management
Over-trading
Too many markets at one time – not enough trades setups
Excessive trades – trying to recoup losses
Pursuit of Perfection and High expectations of
IntradayMoney.in “Winnings” and “Profits”
Catching “The falling Knife”
Trying to Pick “Tops” and/or “Bottoms”
Not having a “trust-worthy” trading plan for trading trends
NO accountability for actions
www.intradaymoney.in
Like fast-paced, risk-filled environment
Looking for “Instant Gratification” www.dailyniftytips.in only Trading from a mindset sure shot tips..! of “greed” or
“desperation”
Overconfidence
Have a very demanding ego that unfortunately distorts one’s rational thinking
Revenge Mindset
IntradayMoney.in
Emotions empower your actions
Remaining in position to avoid admitting wrong
Relying on “Sense of Timing” or “Trading Intuition”
Competitive Nature
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! 3. Sideways Topping Action
Chasing Long entry Chasing Short entry
IntradayMoney.in 1. Sideways Bottoming Action
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! End of counter trend
(1R)
IntradayMoney.in End of counter trend
(1R)
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! End of counter trend
(1R)
Reduce targets Tighten stops
Reduce targets Tighten stops
IntradayMoney.in End of counter trend
(1R)
www.intradaymoney.in Yesterday
Today
www.dailyniftytips.in High only sure shot tips..!
IntradayMoney.in
Pre-Market Gap
Late Day Breakdown
Low
Gap Fill
Immediate exit
TARGET www.intradaymoney.in End of the Move
www.dailyniftytips.in only sure shot tips..!
Flag Pattern 62% 50% Beginning of Move
38%
38%
Current Down Trend
ENTRY End of the Move
50%
IntradayMoney.in 62%
STOP
LEVERAGE Beginning of Move
REWARD-TO-RISK MODEL
~ 2:1
www.intradaymoney.in Price Action Beginning www.dailyniftytips.in of Move only sure shot tips..!
Daily or Weekly
TARGET
End of the Move
PHASE IV 38% Current Down Trend
ENTRY End of the Move
50%
IntradayMoney.in 62%
STOP
Beginning of Move
•Down trend •Lower Highs & Lower Lows
www.intradaymoney.in Beginning of Move
STOP
www.dailyniftytips.in only sure shot tips..!
62% RISK
End of the Move
Current Uptrend
ENTRY
50%
38%
38%
IntradayMoney.in REWARD
50%
62%
TARGET
End of the Move
Beginning of Move
UP Trend
www.intradaymoney.in
Price Action
Daily or Weekly
www.dailyniftytips.in only sure shot tips..!
Decide to use Trailing Stop
Beginning of Move STOP
PHASE II End of the Move
RISK ENTRY
Current Uptrend
IntradayMoney.in REWARD
End of Move
TARGET
Beginning of Move
•Up trend •Higher Highs & Higher Lows
IntradayMoney.in
www.intradaymoney.in
Major Price Action is trending upward and you are focused on SHORTING
Major Price Action is trending downward and you are focused on going LONG www.dailyniftytips.in only Majorsure Priceshot Action is trading in a sideways consolidation pattern and tips..!
Your focused on price action trending upward or
Your focused on price action trending downward
Price Action gaps
Up and you are focused on FADING the gap
Down and you are focused on the gap FILLING
Price Action is relatively
IntradayMoney.in
Strong in multiple markets and your focusing on weak price action setups for shorting
Weak in multiple markets and your focusing on strong price action setups for going long
www.intradaymoney.in Price Action
www.dailyniftytips.in only sure shot tips..!
Ideal trading situation
IntradayMoney.in ENTRY
LONG Entry •Up trend •Higher Highs & Higher Lows
4
4
www.dailyniftytips.in only sure shot tips..!
www.intradaymoney.in Price Action
4
Ideal trading situation
4 4
Natural pullbacks &
IntradayMoney.in
4
counter trends in price action
ENTRY
LONG Entry •Up trend •Higher Highs & Higher Lows
Look for declining volume on pullbacks
4
B 4
3
www.dailyniftytips.in 2 1 only sure shot tips..!
Parallel
C
www.intradaymoney.in Price Action
4
A
4 Flags
4
Natural pullbacks
IntradayMoney.in
4
in price action
ENTRY
Major Up Trend •Higher Highs & Higher Lows
Higher highs and higher lows provide evidence of uptrend
www.intradaymoney.in 20 MA
Setup Signal
www.dailyniftytips.in
•2B/3B Candlestick Reversals •Crossingonly MA’s sure shot tips..! •RSI – Short/Sell signals •Stochastic – Oversold signals •MACD – Down trending histogram •Volume decreasing •Divergence •No Upside Follow Thru
B 3
200 MA
2 1
Major Trend
IntradayMoney.in C
Flag
A
Trading against the major trend
•Higher timeframe uptrend
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Focus on Speed of uptrend Long Setups
1. Sideways Bottoming Action
3. Sideways Topping Action
Focus on Speed of downtrend
IntradayMoney.in Short Setups
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Minor support area
IntradayMoney.in Major support areas
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Bullish
Bearish
Engulfing
Engulfing
IntradayMoney.in 50%
Bullish 50%
Piercing
Bearish
Piercing
www.intradaymoney.in
www.dailyniftytips.in Countertrend only sure shot tips..! Setup
Countertrend Setup 3. Sideways Topping Action
3-Bar Bearish Reversal
3-Bar Bullish Reversal Bull Trap Bear Trap Bullish Piercing Bullish Engulfing Opening Range – Higher Low
1. Sideways Bottoming Action
IntradayMoney.in Bearish Piercing
Bearish Engulfing
Opening Range – Lower High
1. Sideways Bottoming Action
www.intradaymoney.in Countertrend Setup
4
www.dailyniftytips.in only sure shot tips..!
Price Action
4 4
Ideal trading situation 4
Trying to trade the natural pullbacks
IntradayMoney.in 4
ENTRY
LONG Entry •Up trend •Higher Highs & Higher Lows
www.intradaymoney.in Countertrend Setup
20 MA
Reverse Entry Signals & Trading Doubt www.dailyniftytips.in
only sure shot tips..! •2B/3B Candlestick Reversals •Crossing MA’s •RSI – Short/Sell signals •Stochastic – Oversold signals •MACD – Down trending histogram •Volume decreasing •Divergence •No Upside Follow Thru
B 3
200 MA
2
1
Major Trend
IntradayMoney.in C
Flag
A
Trading against the major trend
•Higher timeframe uptrend
www.intradaymoney.in
Most traders are NOT aware they are counter trend trading price action until they
are actually in the trade and managing it. www.dailyniftytips.in only sure shot tips..!
Often, the speed of the uptrend can assist traders with determining the profit opportunity and “odds” of success for counter trend trading
Aggressive up trends often have aggressive retracements
Setups, Signals, and Strategies have to be very focused and fast for entry to maximize potential profit
IntradayMoney.in
Remember counter trends are short in duration
Very dependent on the timeframe for performance
www.intradaymoney.in
Often traders loose trying to accurately trade the countertrend paradigm
Buying New Lows: www.dailyniftytips.in only sure shot tips..! “Bottom-fishing” to pick the market bottoms and focus on exactly getting in at the low of the price action downtrend.
Traditional trading suggest waiting for confirmation that support has held and prices are moving in an uptrend with higher highs and higher lows
Selling New Highs:
of the price action uptrend.
IntradayMoney.in
Traders trying to pick the market tops and focus on exactly getting out or shorting at the high
Traditional trading suggest waiting for confirmation that overhead resistance has held and prices are moving in a downtrend with lower highs and lower lows
www.intradaymoney.in When countertrend trading know:
Support and resistance levels where traders identify entry and exit opportunities when www.dailyniftytips.in trading. only sure shot tips..! Fibonacci percentage "retracement" levels where savvy traders use them to improve their entry and exit points.
How traders often try buying into support ▪
Buying breakouts in an uptrend is often chasing the move; similar to buying new highs or shorting new lows
How traders often try shorting into resistance ▪
IntradayMoney.in
How traders often try buying a breakout ▪
If the major price action trend is in a downtrend, more than likely, it will continue
If the major price action trend is in a up trend, more than likely, it will continue
How traders often try shorting a breakdown
www.intradaymoney.in
www.dailyniftytips.inTrading with the trending price action. only sure shot tips..! Use Fib levels, sideways consolidation and Breakouts for BUY signals
2
3 1
2
1
3
IntradayMoney.in Use Fib levels, sideways consolidation and Breakdowns for SHORT signals
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
1
2
3. Sideways Topping Action
2 3
1. Sideways Bottoming Action
3
IntradayMoney.in 1
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! Chart pattern
3. Sideways Topping Action
Chart pattern confirms sell signal
confirms buy signal
IntradayMoney.in 1. Sideways Bottoming Action
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! Aggressive Short
3. Sideways Topping Action
Aggressive Buy
IntradayMoney.in 1. Sideways Bottoming Action
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..!
Chasing The Markets
Excessive Losses
Lack of patience and discipline
Tunnel vision in reference to market conditions
Inter-market Analysis
Improper money management or risk management
Over-trading
Too many markets at one time – not enough trades setups
Excessive trades – trying to recoup losses
Pursuit of Perfection and High expectations of
IntradayMoney.in “Winnings” and “Profits”
Catching “The falling Knife”
Trying to Pick “Tops” and/or “Bottoms”
Not having a “trust-worthy” trading plan for trading trends
NO accountability for actions
www.intradaymoney.in
Like fast-paced, risk-filled environment
Looking for “Instant Gratification” www.dailyniftytips.in only Trading from a mindset sure shot tips..! of “greed” or
“desperation”
Overconfidence
Have a very demanding ego that unfortunately distorts one’s rational thinking
Revenge Mindset
IntradayMoney.in
Emotions empower your actions
Remaining in position to avoid admitting wrong
Relying on “Sense of Timing” or “Trading Intuition”
Competitive Nature
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! 3. Sideways Topping Action
Chasing Long entry Chasing Short entry
IntradayMoney.in 1. Sideways Bottoming Action
1. Sideways Bottoming Action
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! End of counter trend
(1R)
IntradayMoney.in End of counter trend
(1R)
www.intradaymoney.in
www.dailyniftytips.in only sure shot tips..! End of counter trend
(1R)
Reduce targets Tighten stops
Reduce targets Tighten stops
IntradayMoney.in End of counter trend
(1R)
www.intradaymoney.in Yesterday
Today
www.dailyniftytips.in High only sure shot tips..!
IntradayMoney.in
Pre-Market Gap
Late Day Breakdown
Low
Gap Fill
Immediate exit
TARGET www.intradaymoney.in End of the Move
www.dailyniftytips.in only sure shot tips..!
Flag Pattern 62% 50% Beginning of Move
38%
38%
Current Down Trend
ENTRY End of the Move
50%
IntradayMoney.in 62%
STOP
LEVERAGE Beginning of Move
REWARD-TO-RISK MODEL
~ 2:1
www.intradaymoney.in Price Action Beginning www.dailyniftytips.in of Move only sure shot tips..!
Daily or Weekly
TARGET
End of the Move
PHASE IV 38% Current Down Trend
ENTRY End of the Move
50%
IntradayMoney.in 62%
STOP
Beginning of Move
•Down trend •Lower Highs & Lower Lows
www.intradaymoney.in Beginning of Move
STOP
www.dailyniftytips.in only sure shot tips..!
62% RISK
End of the Move
Current Uptrend
ENTRY
50%
38%
38%
IntradayMoney.in REWARD
50%
62%
TARGET
End of the Move
Beginning of Move
UP Trend
www.intradaymoney.in
Price Action
Daily or Weekly
www.dailyniftytips.in only sure shot tips..!
Decide to use Trailing Stop
Beginning of Move STOP
PHASE II End of the Move
RISK ENTRY
Current Uptrend
IntradayMoney.in REWARD
End of Move
TARGET
Beginning of Move
•Up trend •Higher Highs & Higher Lows
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