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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