1. Hare Krishna Mitra 16 th June, 2012

2.  Stop Loss  Break out Trades  Trend within a Trend

3.  Fundamental based  Price Action Based  Indicator based ◦ Moving Average based ◦ Oscillator based ◦ Channel based  Hybrid ◦ Combination of price action and indicators  Fixed Dollar Stop based on ATR  A fixed percent stop

4. ◦ Getting stopped out frequently when it is too close ◦ Probability of loosing a large amount when it is too wide ◦ Optimum stop loss is a function of market volatility

5.  While expecting the price to come out of a trading range the entry point and stop loss determination is a daunting task  Stop needs to be wide  An unexpected news event could sour an otherwise winning trade

6.  While trying to catch a bigger trend often times we miss multiple smaller swing opportunities  We also miss a bigger trend while focusing on smaller swings

7.  It consists of two components - ◦ Taking a long position from one account ◦ Taking a short position from a companion account  Two components, long & short, could be taken - ◦ At the same price level ◦ At slightly different price levels ◦ At completely different price levels

8.  This kind of entry can be taken to capture breakout trades Seller Concentration Area / Resistance Zone Buy stop Sell stop Trading from one acct.Trading from two accts. Long from acct. A Short from acct. B Seller Concentration Area / Resistance Zone Stop for acct. A Stop for acct. B

9.  This can be utilized for reducing the loss in case the trade is stopped out while giving the trade (pair) enough room for fluctuation Entry Point Stop Loss 1 ATR Long Entry from acct. A Cover the short: acct. B at a buy signal or close the long: acct. A at a sell signal or close both 0.5 ATR Short Entry from acct. B 2 ATR Trading from one acct. Trading from two accts.

10.  This can be deployed to capture the bigger trend from one acct. and profit from the smaller trends within from the other acct. Long: acct. A Short: acct. B Take profit: acct. A & acct. B Cover: acct. B

11. Good Luck & Good Trading!