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Saturday, 30 April 2016

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Some Common Strategies to Trade in the Stock Market

some common strategies to trade in the stock market day trading   StockMarket is a lucrative business for many people. Different traders approach the Stock market to gain benefit from the regular price movements involved. There are many strategies which are common in the Stock Trading.

   There are people which are involved in to it. Some common strategies involved are indicator based strategies, money management based techniques, risk management technique and other self devised techniques.

   This is an article about some of the common strategies which are used in the StockMarket. The first hour breakout strategy, the pair strategy, the grid strategy and spread techniques are some of the common strategies involved in the Stock market.

   In the first hour strategy, the market movement in the first hour is observed. The range of the market, i.e the high and low in the first hour is identified and the breakout from the range is watched for. If the breakout from the high is observed, the uptrend is anticipated. 
   
   Similarly if the breakout from the low is watched the downtrend is anticipated to continue. Thus the appropriate long and short positions can be taken on the start of uptrend and downtrend.
In the pair strategy, a pair is first selected which has similar behavior and characteristics.

   Thus if the two stocks are selected as a pair, the two stocks will show similar behavior in similar market conditions. The deviation from the pair is observed and once the divergence has been observed, the movement towards the mean position can be utilized to benefit from the buy and sell trades.

    In the grid strategy a grid of the buy and sell calls is placed around the current market price. The buy and then sell calls are placed above the CMP and sell and then buy are placed below the CMP. The grid strategy is a high probability strategy.

   where the traders can be benefitted from the general market conditions.The above strategies are extensively used to generate accurate stock market tips and intraday trading tips.  

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