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Trading Strategies at Navia Markets

This document discusses various aspects of technical analysis for stock trading. It begins by asking whether the stock market is gambling or a business, and argues it can be both depending on one's approach. It then outlines some common participant types in markets. The document differentiates between fundamental and technical analysis, and argues technical analysis believes price movements are not always random and the "what" is more important than the "why". It provides an overview of trends, support/resistance levels, and moving averages, which are key tools in technical analysis. Basic rules of investing are also outlined.

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vrekhavasu
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267 views23 pages

Trading Strategies at Navia Markets

This document discusses various aspects of technical analysis for stock trading. It begins by asking whether the stock market is gambling or a business, and argues it can be both depending on one's approach. It then outlines some common participant types in markets. The document differentiates between fundamental and technical analysis, and argues technical analysis believes price movements are not always random and the "what" is more important than the "why". It provides an overview of trends, support/resistance levels, and moving averages, which are key tools in technical analysis. Basic rules of investing are also outlined.

Uploaded by

vrekhavasu
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd

By

Vigneshwaraj.T.R,
Navia Markets Limited
Objective of trading

• Consistent return
Share Market is gambling or
business ?
• We can argue both ways, "yes it is" and "no it
isn't" can be equally true
• The stock market can be used either way, it is
mostly a matter of how you approach it
• In business you will look for ways to minimize
risk and maximize profit
• Gamblers who keep taking high risks for a
negative expected return, and are always hoping
for an elusive stroke of luck to turn the tables
Participants
• Trader
• Hedger
• Arbitrager
• Investor
• Scalpers
To kick start trading…
Goal

Know yourself
(Trader/hedger/arbitrager/
scalper/investor)

Design your own model

Based upon fundamental Based upon technical


analysis analysis
Fundamental Vs Technical
Technical Analysis Fundamental Analysis
Technical Analyst Fundamental analyst
approaches a security starts from financial
from chart statement
Believes all news and Believes market is weak
info are accounted in the form of efficiency
stocks’ price i.e., strong
form of efficiency
Used to take short term Used to take long term
to medium term approach
approach
Technical analysis believes..
• Price Discounts Everything
• Price Movements are NOT always random
• “What” more important than “Why”
Not Always Random

"One way of viewing it is that markets may witness extended periods of random
fluctuation, interspersed with shorter periods of nonrandom behavior. The goal of
the chartist is to identify those periods (i.e. major trends)."
How to go with technical analysis
• Identifying the major trend
• Key support and resistance levels
• Measuring momentum
What is trend ?
Based on price ranges
If a series of higher highs and higher lows
occur on a chart, an up trend is in place, and if a
series of lower lows and lower highs occurs, a
down trend is occurring.

Based on Indicators
 The trend may be simplistically defined to be
up when a chosen short moving average is
higher than a chosen long moving average
Types of trend
Based on price ranges
Bullish market - Upward
Bearish market - Downward
Horizontal – Consolidation
Based on Time frame
Long term
Medium term
Short term
How to identify trend
• Drawing lines by connecting higher lows or
lower highs
• By using Moving Average/MACD
MSFT Daily Prices with 10-day MA
9/23/93 to 9/21/94

60

55

50
Price

45

40

35

30
1 21 41 61 81 101 121 141 161 181 201 221 241
Date
Long term Vs Medium term
Trend Channel
Moving average trend identification
Moving average crossovers
Identifying key support/resistance
levels
• Pivot calculator
• Chart

Pivot Formula:
PP= (H+L+C)/3
R1 = (2*PP)-L
R2= PP + (H-L)
S1 = (2*PP) – H
S2 = PP – (H-L)
Support levels in Chart
Resistance levels in Chart
Support become Resistance
Basic Stock Investing Rules Every
Successful Investor Should Follow
1. Buy low-sell high
[Link] stock market is always right
If the market is going down and you are long, the market
is right and you are wrong. If the stock market is going
up and you are short, the market is right and you are
wrong.
3. Every market or stock that goes up will go down and
most markets or stocks that have gone down, will go up
4. Don’t search for reason - To make a profit trading, it is
only necessary to know that markets are moving - not
why they are moving.
5. Stock markets generally move in advance of news or
supportive fundamentals
6. The trend is your friend
7. You must let your profits run
[Link] worst thing an investor can do is take a large
loss
9. Strict money management strategy
Thank You

For any queries, please feel free to reach


me:
vigneshwaraj@[Link]

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