Inside-Out-Trading [Key To Consistent Profitability]


Inside-Out-Trading changed my trading around. From a hit and miss trader to a consistently profitable one. The journey has been one hell of a ride. I know you are excited to know about it so read on…

But before you start Inside-Out-Trading…

Please consider if the following things sound familiar to your trading,

  • You track multiple technical indicators for a given market. Some of them essentially show the same thing. Like using more than one Oscillator or multiple Moving Averages. Do you sometimes feel overwhelmed by them? Do you often miss out signals on one of the indicators and realize it only after the markets have moved?
  • You are glued to the TV Set before an important announcement. You do multiple permutations and combinations for the event result and take positions accordingly, before the event. Do you then find yourself getting too anxious about the outcome of the announcement? Does your stop loss often get hit in the ensuing volatility post the event? Do you beat yourself up for not figuring out the outcome correctly or about taking the wrong position?
  • You are a fan of fundamental analysis, but often get anxious looking at the short-term market movements. You invest in a stock and then worry about the short to medium term swings, which sometimes go against you. Do you then try to trade around your original position? Or do you try to hedge your original position and end up losing money on your hedges?
  • Are you trading based on tips or recommendations of a stock guru? Well, I don’t even want to discuss that further…

If you are doing any of the above and thousand other similar things, then you are trading outside-in. There is nothing criminal in doing that, the only problem is you won’t ever feel or be in control of your trading. Because all the above things are dependent on exogenous factors.

Factors that are outside of your control and sometimes impossible to know in advance. Now if your trading is based on uncertain events, which you have no control over then your chances of success are slim. Majority of trader universe trade like this and then keep wondering why are they not successful.

To remove uncertainty from trading never do this…

Traders read about how to trade, they study the next hot thing, an indicator or an algorithm or some such thing. They get all excited that now their fortunes are going to change. But once again end up with the same result, losses. Now losses are a part of the trading game, but only if you have control over your trading process.

If you are going to rely on something that you have no control over then how can you expect to control your outcome? In martial arts, a student is often asked to control the outcome. That does not necessarily mean to always come out a winner. But even if you lose, be safe and healthy to fight another day. There is no point in losing your fighting ability to just win one fight. A great fighter is a sum total of all his fights, likewise, a trader is a sum total of all of his trades and not a single one.

In fact, great traders often say any one trade is insignificant in identifying your trading success. It is the repeatability of your success that matters in the long run.

So how do we become consistently successful in this extremely competitive game of trading? If outside-in trading is not such a good idea what is the alternative? Is it inside-out trading? If yes then how do we do that?

I know all these questions are cluttering your mind right now. That is a good sign, it means you are curious and want to improve your trading. You want to learn something new. So let’s get straight to it.

Here is the solution, go Inside-Out…

Yes, the solution is inside-out trading. You may have heard top-down or bottom-up trading. This concept is similar in many ways but applies to each individual trading instrument. A trading instrument moves up or down in price based on the buying and selling of the traders trading in it. If buyers are more and aggressive the instrument is likely to move up in price and vice verso for sellers.

If there is a good news associated with a stock the buyers are more eager to acquire it, on the other hand, if the news is bad people holding it would like to get rid of it. It is always the action of the traders that causes the instrument to move up or down in price. What spurs the traders into action is external to the instruments price movement.

That is why we at GTTE try to focus on the generator of price movements, namely traders actions and try to figure out what the stocks, commodity, future, etc are going to do.

So how do we do it, inside-out trading? Well, we do it by trying to figure out what the Smart Traders [those who often come out on the winning side] are doing. Are they buying? Selling? Are they present or absent? These are few of the questions that we try to answer when we are trying to trade the markets.

Do we always come out on top, no not always? But there are certain benefits of trading inside-out that outweighs any other method by a huge margin. A few of them are,

  1. Every trade you take may not be a winner, but you will surely avoid a lot of bad trades.
  2. You don’t have to watch TV again, unless of course for entertainment purposes.
  3. No need to track all the events and their dates to run after that opportunity which lasts for fleeting second and often traps traders in bad positions.
  4. Incredible peace of mind, a lot of your mental load will be released and you can trade without anxiety, yes that is possible.
  5. This way of approaching the markets will greatly improve your market understanding. Crucial to avoid bad trades and not miss out on the meaty ones.
  6. And many many more….

Ok, so we use inside-out trading, but what tools does one use to make it happen?

Well here is the low down on the tools required for this type of trading…

We believe all these tools have the ability to look behind the obvious and that is the price, to give you the real picture of what is happening in the markets. While or go one level deep, can go two levels deeper than the ordinary price chart with volume.

It may seem a bit over the top for the uninitiated, but trust me once you get to know these methods and the correct way to apply them, you will believe. And for that very purpose, I am sharing an example that includes all the three charts that I use. That is Market Profile, Order Flow and VSA charts covering the same trade.

Go through this example for better understanding of inside-out concept…

The charts are amply annotated so go through them one by one and see how the trade develops and gets executed.

market profile trade setup

order flow trade timing

VSA trade setup

So that is how we observe the market generated information, that is we observe the markets from inside and gradually move outside to timing our entry. This inside-out approach has improved my trading so much that I can’t be happier that I discovered it. The only regret is I should have discovered it sooner.

Just in case you are wondering how the trade worked out, here is the follow through move. Our target was hit comfortably.

trade result

Ok, so that was it. The inside-out approach and a nice example to go with it.

So where do you go from here…

Now, if this method of analysing and trading the markets piques your interest then you can learn this too.  I have covered the first part that is the Market Profile part, in my home study course Market Profile Gateway To Profits Course.

You can find more about it by visiting this link – Market Profile Gateway To Profits Course

Best Regards

Dean

Part II – Market Profile [What Is The Market Doing Right Now]

nifty market profile chart

Hello traders welcome to GTTE, I am Dean and I am going to take you through my trading journey and how I learnt all about Market Profile…

Today we are going to look at Part II of my journey.

In Part I, we saw, wait if you haven’t yet gone through it I recommend going through it right now, I have discussed how I came to know about the Smart Money in the markets. As I became aware of the presence of Smart Money in the markets my whole approach towards trading changed.

I started to look for the signs of Smart Money buying to buy and SM selling to sell. This gave me some relief from the string of losses I used to experience. Still, the consistency was not up to the mark. Sometimes after doing everything right, my trades used to fail. So I was back to the drawing board, only this time I was more excited than depressed.

I believed that there was a possibility that I will find the solution to my problem. The problem of “knowing what the markets are doing right now?”.

Suddenly I felt I was practising Zen instead of trading, but then you can’t achieve anything great if you can’t get into a meditative state while you are doing anything.

So listen carefully…

The reason why I started looking for an answer to this question,

“What are the markets doing right now?”,

was that, even when I was right about the SM buying or selling, the markets did not respond immediately after I put on a trade.

So what did I do?

At first, like any amateur trader, I thought this was a timing issue and pursued many timing tools to solve it. I tried oscillators, various complicated indicators, trend lines, pattern breakouts, wave patterns, etc. But to no avail, as my problem was not of timing but understanding what the markets are doing right now.

After a lot of pain and self-doubt, I asked myself “how do I find out what the markets are doing right now?”.

That is when it struck me that mine was not a timing issue but a market understanding issue. So I asked what are the tools that will tell me what the market is doing right now. And while I was on the lookout for that I stopped using oscillators and indicators.

Not that they are bad, but I was using them wrong. So mind you there is a time and place to use these derived indicators, which by definition will always follow price.

Hope came in the form of Market Profile!

Now in the meanwhile, I was looking at for some time now. But since I could not figure out what exactly is the use for it, I was not very serious about it. But when I asked the question “how do I find out what the markets are doing right now?”, to myself, I remembered hearing James Dalton speak about how Market Profile is not a trading tool. But it was just a way of organizing data. Also, it will not give you buy sell signals but tell you what the markets are doing right now.

So there it was a potential solution to my predicament. As always once I realized what MP could do, I started to beat my self up for not seeing it earlier.

But here is a crucial learning, sometimes it takes someone, who has gone through the f=grind, to show you how it’s done. I still remember the elation I felt when I remembered Jim’s words about MP. For sure I went through many of his webinars again and again. This time trying to find out what the MP shows about the markets and not trying to extract a pattern or two to apply to my trading right away.

It’s a good habit to cultivate some patience and perseverance.

Market Profile – Video Example

So how exactly do we use MP, you ask? Well, you don’t have to go too far. Here is a webinar recording which I believe will give you a nice over view of what MP is and how it can help you understand what the markets are doing right now.

This is a webinar I conducted earlier and it is just as relevant today. Just go through it and let me know what you feel!

So that was a long video but certainly filled with great information, wasn’t it?

I know you would like to share it with your friends who are interested in MP. I encourage you to do so. If you haven’t go back to the video and share it on your Social Media channels.

How do you understand what market is doing right now using Market Profile?

Now for the committed traders like you who want to learn more about MP and want to trade using MP we have a perfect solution for you. Our “Market Profile – Gateway To profits Course”.

The course is designed keeping in mind the different needs of traders at different stages of the learning curve. So if you are a beginner or you have some experience with MP and trading this course has plenty of value to offer.

Come check it out now…

In the next part, I will share with you what I discovered as I moved on this journey to consistent profitability. It’s about a timing tool called Order Flow!

Read the next part here…

 

 

14 Pertinent Trading Questions Answered! Quick tips to fast improve your trading profitability.

Welcome to Get That Trading Edge (GTTE)

We are an education company which strives provide high quality training toGTTE Trading Process avid traders and investors. We help you learn the craft of trading successfully in today’s age of highly volatile markets. We achieve this by focusing on the importance of having a complete Trading Process the secret of professional traders! In this post we answer 14 most pertinent trading questions to both beginners and experts alike! So dive in and enjoy this post all the while picking some highly practical tips, you can apply to your trading today!

 


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Trading Questions 1: What is a Trading Process?

A Trading Process is a guide which shows you what to do throughout your trading journey. It guides you at every step of the way. Be it making good trades or controlling risk effectively or learning from the mistakes you made or repeating those things which yo can do better than others.

Most of all it ensures that you don’t stray too far away from your trading plan, and make continuous improvement in your trading.

At GTTE we believe a Trading Process consists of 3 components and each is essential for successful trading. We call it the Process Funnel and each stage is vital for your trading success. Look at the infographic on the side. Lets look at each component in detail. The three components are discussed in detail below.


Trading Questions 2: What is a Strategy?

Trading Process Strategy
Strategy

A trading strategy is something which guides your trading actions in the markets. Professional traders never step into the ring without a trading strategy. It is not about where to buy/sell or where to exit. It tells you what you should focus on in the current market condition.

Naturally, if the market condition changes so will your strategy.

A few examples of trading strategies used are,

As it can be seen not all the trading strategies can be applied to the markets simultaneously. Als, not everybody can be good at all the trading strategies. What you need to do is to find a trading strategy that suits your personal trading style. And then trade only when the current market conditions allows use of your choice trading strategy. Lets see how you can use this crucial part of your Trading Process!


Trading Questions 3: How do you identify which is the one that fits you?

Trading Strategies
Perfect Fit

The best way to do this is to dig into your trading records. If you don’t have any just get the trade reports from you broker for last 10 – 20 trades and see the ones which did well. Find that point on the chart and then reverse engineer what your logic was to take the trade.

If all this seems too difficult then you can simply start keeping records of your trades from today and track the profitable ones. Then you can note down the market conditions present at the time of trade like trending, sideways, etc. And also the trades you were comfortable with. All this when you superimpose on the 3 trading strategies mentioned above, you will come to know which suits you better.

 

 

 


Trading Questions 4: Where to go from here?

Trading strategies
Where to go from here?

Once again good to see your keen interest. Now that you know why trading strategies are so important and how to select one for yourself. Let’s dive into the individual trading strategies and see some examples for each one of them.

So have fun while learning about these trading strategies. Having a trading strategy covers one-third of your trading, knowing how to execute it covers another third. That leaves the last third and those are the tools. We will go through each one of these one by one.


Trading Questions 5: What is a Trading Method?

 

It’s OK if you are MAD, but there must be a Method To Your MADNESS!

A trading method consists of rules and guidelines which you must follow to execute your strategy. It is an important part of your Trading Process!

So at GTTE we first and foremost select a strategy based on current market conditions.

Then we apply the Entry Rules. We apply these entry rules not based on some rigid set of rules but based on logic. This trading logic comes from Auction Market Theory (AMT).

So even though we track important reference levels in the markets, we don’t blindly buy/sell once we reach these levels. Instead we use AMT logic to see what the Smart Money is doing and then try to match out trading with them. Both entries and exits.

But we do all this while staying within the Risk Limits that our capital permits.


Que 6 : Which Trading Strategy should I Select?

This is a crucial step of your trading method to any hope for lasting trading success. It took me more than a decade to understand what exactly a strategy is and how does it help us in our trading. I wont spend much time here just visit this to know more about strategy in trading.

If you have read it then may be go through the 3 strategies I have discussed for your benefit,


Trading Questions 7: What are the best Entry Rules I can use in my Trading?

Trading Method Entry
Entry

These are the patterns which generally repeat when you reach important reference levels. Now an important reference level should be marked based on logic not on common wisdom.

One example of logic is to find the areas where Smart Money committed themselves. Because when price retests these areas Sm is expected to defend their positions. The intent showed by Sm at these levels gives us our trades entries.

Relying solely on past observations can become frustrating when numbers catch up to you and you get those streaks of pattern failure. Using logic instead of past observations will help you judge the relative significance of the reference areas as well as whether the SM is doing a good job of defending their commitments.

Order Flow Charts become the perfect “hero support” to in this case. So once again having useful and reliable tools in your arsenal is critical to trading success.

You can see a few of the trade entries I commonly use here…..


Trading Questions 8: What are the best Exit Rules I can use in my Trading?

Trading Method Exit
Exit

For exit we will be taking a look at “Risk” but not the usual risk associated with Stop Loss and Money Management. This risk as Jim has put it in his books is the risk of holding a position in the current markets.

Auction Market Theory states that an auction moves up to find sellers and moves down to find buyers. Once an up auction finds sellers it either goes sideways or reverses. And that is precisely what we use when we are looking for an exit.

We usually exit a long when the buyers give up (normally leads to hitting of stop loss) or when the sellers over power buyers (normally happens when we reach an important seller reference).

If you buy and buyers aka SM is not buying with you, the weak holders wont be able to push prices higher or even hold them at current levels. In such a scenario it makes little sense to hold on to your longs.

Also when price reaches an important seller reference and it looks like SM sellers are defending their commitment then there is no point in clinging on to hope of some additional precious shekels.

It becomes even clear when you look at some examples here…..


Trading Questions 9: How do I Manage Risk in my Trading?

Manage Risk - Trading Method
Manage Risk

Once again we don’t look at risk the same traditional way. We believe that no amount of calculating the probabilities will help you manage risk. The best way is to use logic to assess the risk of holding a trade or not being in the markets. This we do when we are talking about the risk of entering, exiting or not entering a trade.

When we talk about risk capital, then we follow the rule of thumb of not risking more than 1% of your capital on any one trade. For small accounts this becomes a real roadblock.

So in that case I found that if you have a stable trading process which can be applied on any time frame. Then by simply reducing the time frame you trade on you can reduce the rupee risk you have to take. For instance if you are scalping Nifty for 5-10 points, then your risk even for a R:R of 1:1 becomes 5-10 points.

Instead when you try to take swing trades your SL can easily become 50-100 points as the average trading range in Nifty itself is around 80 odd points a day.


Trading Questions 10: Where to go from here?

Trading method is one of the most important element in your trading process. It forms almost 33% of your trading process and we must get it right.

There are many ways you can handle the issue of entry exit & risk. Click on the link to view how we do it at Get That Trading Edge!

 

 

 

 


Trading Questions 11: What are different Trading Tools and How to Use Them?

Trading Process Tools
Trading Tools

This is one of the most exciting part of the whole trading process. Because this where we try to differ from most of the traditional techniques. Also the Smart Money wont do what everyone else is doing.

Also keep in mind that professional traders don’t do different things they do things differently.

We use , Order Flow, Volume Profile & VORACL, Market Cycle Phases to spot low risk trading opportunities in the markets.

To keep track of our trading we update a Trade Log and a Traders Journal daily. We then refer to these records regularly (End Of Week, Month, etc) to learn how we traded and find out areas of improvements.

More often than not we see something which we have done great and we try to repeat it as much as possible to get the most out of it.

Analyzing the markets using the tools mentioned is as much fun as it is profitable. These tools help us in our foremost objective of trading with the Smart Money.

Trading Tools are an important part of your Trading Process. Having a great tool is almost as important as having a good Trading Method or a correct Strategy based on current market conditions.

Selecting a Trading Tools is a personal preference. I personally use Market Profile Charts, and my own adaptation of and Volume Profile which I have named VORACL system. Lets dive into a few pertinent questions regarding Trading Tools.


Trading Questions 12: How to find a Trading Tool that suits your Trading Style?

Trading Tools
Trading Style

There are primarily 5 types of traders as shown in the image and each has his own way of trading, time frames, objectives and targets. It is the interaction of these different types of traders that makes trading so fascinating and utterly confusing at times. That is when you need to find a great trading tool. One that will guide you through the confusions and fascinations of the trading world.


Trading Questions 13: What are Different Trading Techniques & Trading Tools?

Here also selecting a trading tool is a personal choice. Some like the classical chart patterns proposed by Edwards and Magee (The first book I read on Trading). Others prefer to trade using momentum indicators proposed by Martin Pring (I read his books extensively in my early trading days). Some prefer an advanced pattern recognition techniques such as Elliott Wave Theory (R N Elliott and Robert Prechter) or Neowave (Glenn Neely). Still others prefer the Harmonic Patterns (Suri Duddhela). Some use Price Action Trading (Al Brooks). Where as some use automated trading techniques  to trade in the markets.


Trading Questions 14: What Trading Tools I Use and How They Can Improve Your Trading?

Market Profile Charts

I personally use Market Profile (Peter Steidlmayer and James Dalton) to find low risk intraday trade opportunities. Sometimes when the markets set up right I go for Short Term as well as Short Swing Trades too. Watch my Webinar Video on Market Profile here…..

Order Flow Charts

Also along with Market Profile, I use Order Flow Charts for timing my trades. is a very important tool if you want to see behind the obvious price moves. It is indispensable if you want to know what Smart Money is up to.  Read more about this fantastic too here…..

VORACL system by Dean

I use VORACL system which is my interpretation of Tom Williams Volume Spread Analysis along with Volume Profile to find especially tasty entries in the markets.

Wyckoff Market Cycle Phases

And above all I use Richard D Wyckoff’s Accumulation – Mark Up – Distribution – Mark Down cycles for analyzing which stage the market is currently in and then select my strategies accordingly. Read More…..

Trading Tools Market Cycle
Wyckoff Market Cycle

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Congratulations you have finished the Trading Process Course by Get That Trading Edge!

A trading tool sometimes takes a lot of time to set with the trader. During this period a trader jumps from one tool to another because of inconsistent trading result. The haphazard trading results are not because of the wrong trading tool, but because a trader does not give sufficient time for the tool to set in.

I have selected some of the tools that I use, you can click on the read more tags above to go even deeper into those tools. I hope you find them useful in your trading.

Before selecting a Trading Tool remember you need a Trading Process and Trading Strategy and Trading Method.

 


 

What is the best way to trade a trend? – Buy Breaks Sell Rallies!


70% of the time markets are in consolidation and remaining time they trend. But getting it wrong in this 30% time can put your account in serious jeopardy. You need a strategy to tackle these periods of trend. We use Buy Breaks Sell Rallies.

Once again this no new stuff. But how do you determine a trend? And then find a reliable reference to buy breaks and sell rallies is what we are going to see here!


Derivatives Trading involves substantial risk of loss and is not suitable for all investors. Past Performance is not necessarily indicative future results – Read Full Disclaimer


Buy Breaks Sell Rallies

We will look at some examples which will help you take informed decisions while trading a trend.


Example 1 – Sell Rallies

Buy Breaks Sell Rallies
Sell Rallies

The adjacent chart shows a 4-5 days old down trend. We have some good opportunities to sell rallies as the down trend is confirmed. The chart makes clear following points,

  • A day with excess and next day forming lower value confirms a ST reversal in trend.
  • The trader behavior should shift to sell rallies till an important ref is reached.
  • In this example we get one shorting opportunity above the imp reference below and another once the reference is crossed.
  • A fresh shorting opportunity was setting up at the time of preparing this chart.

 


Example 2 – Buy Breaks

Buy Breaks Sell Rallies
Buy Breaks

The adjacent chart shows an example where we capitalize of a strong show by buyers. We look to buy breaks that reach important reference levels. The chart clears following points,

  • The trend started when the trend of lower VAP was broken and we got a sideways VAP.
  • Prices rallied sharply away from 2 day composite value and found acceptance at higher levels.
  • High volume nodes at higher levels give a good reference for a break to stop into.
  • Buying at such points has higher probability of successful trades.
  • The first trade came immediately on the next day, whereas a the second trade came later at the right edge of the chart.

So we can use this Buy Breaks Sell Rallies strategy to find low risk entries in an existing trend. This can be used to enter a trend if you miss an early entry. Or pyramid on your existing long or short position.

But the most important thing to remember is we need a clear trend. If the markets are moving sideways then you may have to select a different strategy. Either Buy Low Sell High or Buy Break Outs Sell Break Downs.


Examples For This Strategy


Video For This Post


 

When to Sell Break Downs & Buy Break Outs?


So you have missed an early entry into the trend or want to pyramid your existing position, this is the strategy that will help you do it. Sell Break Downs & Buy Break Outs is a strategy that is in direct conflict of the first strategy we shared with you that is Buy Low Sell High and is used in a different market condition.


Derivatives Trading involves substantial risk of loss and is not suitable for all investors. Past Performance is not necessarily indicative future results – Read Full Disclaimer


Sell Break Downs & Buy Break Outs

There are times when fading BO/BD can lead to financial disaster or missed opportunities. Lets dive into some examples where you can get a feel as to when to go with the BO/BD. Lets see this Strategy in action..


How to Sell Break Downs?

Sell Break Downs & Buy Break Outs
Sell Break Downs

Selling Break Downs is lucrative when you have a lot of buyers trapped and are anxious going into a new trading session.

This is so because when one side of the markets suppose buyers are anxious Sm has added incentive to push the envelope only so far as to cause enough pain to the trapped buyers to make them throw their positions.

The more adamant these trapped buyers greater the subsequent move and hence profits for the SM. In the example above we can see following important points,

  • 4 attempts by buyers not resulting in any elongation to the upside.
  • Every time the price reached the support of the range buyers came in and bought.
  • But their buying could not extend the range in any meaningful way to the up side.
  • This meant that the buying was being supplied to by the SM at higher levels.
  • When towards the fag end of the range prices closed right at the lows of the range.
  • The next day gaps lower and this time the buyers could not push it back up, this is the straw that broke the camels back. We get a huge move down the next day.
  • The news event contributed to the volatility, otherwise the same move would have spanned over a number of days instead of a couple of days.

How to Buy Break Outs?

Buying break outs is obverse of selling break downs. The requirement for buying break outs is exactly opposite of selling break downs. You need a lot of trapped sellers to get a reliable break out.

Whenever we have one side trapped the SM generally uses it to push them out of the markets. And that gives us some dynamic moves in the markets. Lets look at some examples,


Buy Break Outs
Buy Break Outs 1

Example 1

  • In the chart above we see huge accumulation over a period of 2 months by Sm, as evident from the big ‘b’ shape.
  • The current month moved above the loop early on, thus showing the intent of the buyers.
  • The previous sellers try to defend their positions as marked on the chart. But SM absorbs all the selling.
  • Hence the sellers position was precarious as the longer t/f SM was buying from them.
  • An attempt to MD the price could not go too far, and that sealed the deal for sellers.
  • As Sm enters and ramps the price higher trapping all the sellers, this is the right time to buy the break out.

Buy Break Outs
Buy Break Outs 2

Example 2

  • In this chart we have 2 examples of break outs.
  • the first one shows multiple attempt to MD the price, not resulting in any continuation lower.
  • So all the sellers were trapped.
  • And once the buyers pushed the price beyond the range high we got furious rally forcing the sellers to cover.
  • In the second example we have 2 attempts to MD the price. But the second one is because of a news event, resulting in a big down move.
  • The whole pattern looked like a ‘q’ and that prompted us to a potential snap back rally.
  • Once the rally went above the range high and found acceptance we got nice follow through and a successful break out.

Sell Break Downs & Buy Break Outs is a strategy used by most novices, but few are successful doing it. The reason for that is they are not able to distinguish between the right time to apply this strategy and the not so right time. When time is not right to Sell Break Downs & Buy Break Outs we go to the other strategy of Buy Low Sell High.

Click here to know about Buy Low Sell High strategy!


 

What is the best way to trade sideways markets? Buy Low Sell High!


Buy Low Sell High, probably the most basic suggestions you can get about trading. This actually borders on being stupid. But as you will find out it is actually the secret to trading success. This one strategy alone, if implemented correctly can improve your profitability.


Derivatives Trading involves substantial risk of loss and is not suitable for all investors. Past Performance is not necessarily indicative future results – Read Full Disclaimer


What is Buy Low Sell High strategy?

Buy Low Sell High
Buy Low Sell High

In simple words it means you buy when the price of an instrument is low and likely to go higher and sell when price of an instrument is high and likely to go lower.

Sounds simple right! But the key is to find out when the price is low and when it is high. To do this consistently you need a method and tools which tell you when the price is too high or too low.

I use Market Profile Charts to make that assessment. I tried many tools like indicators, channels, classical chart patterns, higher form of pattern recognition like Elliott Waves, Neowaves, harmonics, etc. But some how none of the above tools, though fascinating, seemed to give me lasting confidence. The oft repeated suggestion “to find a method that suits you” kept echoing in my mind. Until I started using .

As it turned out the well meaning “common wisdom” could not serve me well, till I met “common sense”, and we have been friends ever since.


How to Buy Low Sell High using Market Profile Charts?

For finding the high and low price levels we need to find the areas of commitment by buyers and sellers. Once we do that then we can look for a retest into that area. As we reach areas of buyer/seller commitment, we then monitor whether the buyers/sellers are defending that area or not. If they are defending we got our /low/high price respectively.

Lets see a couple of example to make the point clear.

Buy Low Sell High VST
BL SH Intraday
Buy Low Sell High ST
BL SH over a Few Days

 

 

 

 

 

The above examples clear what I mean when I say “Buy Low Sell High”. Using Charts give you many such advantages. Some are fun and some are serious money makers. We will continue our journey of learning to trade and soon we will Get That Trading Edge!


There are different strategies to suit different markets. Other strategies which are very useful are Sell Break Downs & Buy Break Outs and one more is Buy Breaks & Sell Rallies.


Video For This Presentation