nifty trading strategy for next week 19 dec to 23 dec

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Yesterday was an eye opener day for investors. When market was convinced about the RBI policy, a sudden fall in the last hour which triggered several panic trade. Trader’s now pressing panic button at the slight hint of every possible bad news. The news flow will continue to be fluid next week. The first is the outcome of 2G case against P. Chidambaram. 7 Europe countries are likely to be downgraded.

But there is some positive news also. YFrance‘s rating is reaffirmed by a leading rating agency. Amidst the global meltdown A T & T declared 6% dividend, making it worlds’ largest divided paying company. A crash analysis of advance tax numbers reflect flat numbers, remember no recession as feared by IIP numbers. If you take rupee depreciation into account the Nifty is below 3800 level and many stocks in midcap level below that level. So this is not the time to panic, but cherry picking time friends.

Up down up and down again today. In this era of globalization our markets are linked to the world markets directly. Any mishap in any corner of the globe will bound to affect our markets. Till the Global debt issue is resolved, expect such panic days which are the integral part of a vibrant market. Make your habit to live with it.

The best possible strategy is to change your trading strategy in the following way.

• Trade light with strict trailing stop loss
• Buy or sell in staggered way to make most of volatility
• Do not carry overnight positions except high risk traders
• Fix stop loss as per your risk appetite and position
• Fix achievable target in view of market conditions
• Exit a trade at a slightest hint of weakness
• Your 1^st target is to protect capital, so use trailing stop loss.
• Avoid buying a stock after it has run up too fast
• Never catch a falling knife( stock)
•  Even if all these precautions a trade goes wrong, do not try to average or hold as it, just close the call and hunt for new opportunity.

HAPPY WEEKEND.